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Mortgage Refinancing Checklist

Hard 20 items · 2 hours
testuser's avatar
testuser Published 4 weeks ago
Lifestyle

This checklist walks you through evaluating a mortgage refinance: compare rates, estimate costs, check equity, prepare documents, and compare lenders. It’s for homeowners considering refinance who want a clear, step-by-step evaluation before committing.

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  1. Review current mortgage details — Note loan balance, interest rate, remaining term, monthly payment, and servicer contact
  2. Research current market mortgage rates — Check published rates for your credit tier and desired term from multiple sources
  3. Estimate total closing costs — Include appraisal, title, origination, recording, and third-party fees (commonly 2–5% of loan)
  4. Calculate the break-even point — Divide estimated closing costs by projected monthly savings to find months to recoup costs
  5. Check for prepayment penalties and loan restrictions — Review original mortgage documents or contact servicer for any penalties or holdbacks
  6. Decide on your target loan term and monthly payment goal — Choose whether to shorten for interest savings or extend to lower payment
  7. Check and document your credit score and history — Pull free reports, note inaccuracies, and record current scores for lender tiers
  8. Improve credit where possible before applying — Reduce card balances, avoid new credit, and correct errors to boost rates
  9. Gather required documents for the refinance application — Assemble income, tax, asset, and property paperwork lenders commonly request
  10. Collect recent pay stubs and income verification — Provide last 2–3 pay stubs or contractor 1099s if self-employed
  11. Collect tax returns and W-2s for two years — Include signed returns and schedules if you have business income
  12. Collect bank statements, asset proofs, and current mortgage statement — Gather last 2–3 months of statements and your latest mortgage/escrow info
  13. Choose at least three lenders to compare — Include a mix of bank, credit union, and online lenders for balance
  14. Request Loan Estimates from chosen lenders — Ask for a Loan Estimate (LE) for the exact loan term you're considering
  15. Compare Loan Estimates line-by-line — Compare APR, total cash to close, origination fees, and rate lock terms
  16. Run amortization scenarios to compare lifetime interest and savings — Model different rates and terms to see total interest and payoff timelines
  17. Verify home equity and loan-to-value (LTV) — Calculate LTV (loan balance ÷ home value) to assess PMI or cash-out options
  18. Decide whether to roll closing costs into the loan or pay upfront — Compare lower upfront cost versus higher financed principal and interest
  19. Obtain a rate lock or pre-approval when satisfied with an offer — Confirm lock duration, fees, and any conditions to secure the quoted rate
  20. Review the Closing Disclosure and confirm final terms before closing — Compare to the Loan Estimate, confirm cash to close, schedule closing, and verify wire instructions
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