Countrywide Refinancing: 10 Tips
In order to have a positive Countrywide refinancing experience (now Bank of America), it pays to be very organized and take a few preliminary steps before you even pick up the phone and call your loan officer. Here is the real skinny on getting your loan approved with the best terms possible.
- Be realistic about your home’s value. Check online appraisal sites to get an approximation of what the house is worth, or ask any real estate agent for a free Comparative Market Analysis (CMA) which is sort of a mini-appraisal. Countrywide refinancing is heavily dependent on having equity in your property.
- Get your income and asset paperwork together. Once you have determined you have enough equity in your house to refinance, gather up all of your income and asset documentation and send it over with your initial application. The basics include your W2s or tax returns for the past two years, your last two months’ bank statements, and any IRA or 401k statements. Having this all upfront will help your loan officer make the necessary calculations faster and avoid surprises.
- Shop around and apply at more than one place at a time. You have about two weeks to get your credit pulled an unlimited amount of times with different mortgage lenders without it hurting your score. So do all your applications at once. Shopping around and getting your credit pulled at three or four mortgage companies within three or four days is recommended.
- Gather paperwork on the property itself. This means to do a little legwork and gather your latest homeowner’s insurance premium statement, your last tax bill, and the contact information for any homeowner’s association. Not providing these upfront can mean delays, and possibly losing your promised interest rate and low monthly payment. Not fun.
- Lock in your rate for 60 days. This will cost you a little more in fees or rate, but not much. It is better to allow more time to close your Countrywide refinance because Murphy’s law loves to prove itself in the mortgage loan process.
- Read through your initial disclosures carefully. Don’t take any bull from the loan officer if wha the promised are not reflected on this first set of documents. On the Good Faith Estimate and Truth-In-Lending forms, look out for prepayment penalties or higher fees and rates then what you agreed to.
- Prepare for the appraisal. Make sure you are finished with any major repairs before the appraiser visits. Having large holes in your drywall or roof will delay your Countrywide refinancing, and the lender will make you fix these defects before closing the loan. This means another appraiser visit, and more money out of pocket.
- Avoid closing at the end of the month. This is when the majority of loan closings happen, meaning you will be feeling very rushed by the title or escrow officer who is handling your Countrywide refinancing. If there is an issue or you have a lot of questions, you will not get the best service at the end of the month because they want to move on to the next guy. The best time to try to schedule your closing is towards the fifeenth or so. Title and escrow people will have more time to answer questions.
- Compare your initial and final terms. Bring the Good Faith Estimate from your initial disclosures with you to your loan closing, and compare to the final settlement statement. Make sure you know why any figures changed, or call and get clarification from your loan officer. If anything is iffy, walk away. Better to lose a few hundred bucks than several thousand in extra interest, fees, or prepayment penalty if you were bait-and-switched.
- Keep records. It is important to keep a copy of your Countrywide refinancing loan documents in a safe place. The costs involved in refinancing a home can impact the tax basis of the property should you ever convert it to a rental. You also want to make sure you have your own copy of your signed documents in the event of a dispute with the lender.