Just a couple of years ago before the big crash, I was able to obtain a loan to buy a million dollar home just by over inflating my income sources. No other questions were asked, and I was approved. I didn’t take advantage as I got cold feet, thinking I might be biting off more than I could handle.
Thank God I didn’t, as the price of the home dropped over four hundred thousand dollars since then, and I would have been just another statistic. If things remained the same, I would have not had a problem should I have gone through with the deal. So in one way or another, I beat getting beat up by the price of the home falling far below what I would have owed on it. So many were not so fortunate to have second thoughts before signing something that would have in the end mean the loss of thier home and money.
If you feel strongly about getting a lower rate, check around, or simply call the lender your dealing with and ask to speak to the agent who originally processed your loan if he or she is still available. The lender you’re with has all the records concerning your loan, and makes life easier for when applying.
Obtain all you can as far as pertinent information about your income, outstanding loans, bills, and other finances relative to being able to secure a lower rate. You will also be required to furnish the past two years of income tax records as well.
Let the lender know what your intentions are and why. Find out how much it will cost to secure the new rate, which usually means refinancing to get it. Ask if over the long run if it would be worth it based on the cost of refinancing and the term. Sometimes the cost of refinancing which includes a new appraisal as well as costs related to refinancing will either cost you up front, or will be tacked onto the mortgage.
At the same time ask about additional money to be borrowed if you need it, and still keep the payments lower as a result of the new rate. Even if the payments remain the same or slightly higher as a result of obtaining more cash, it’s the interest we’re concerned about. Saved interest is money in your pocket, and if borrowing a little more cash as a result of lowered rates without increasing your payment, then this is a win, win, situation.