Once you have reviewed the types of refinancing that are available and found the option that works best for you, it is time to apply. When applying, the lender will ask for the same information that your original lender asked for when you initially bought your home. Usually, this will include information such as your income, assets, debt, and credit score. This information helps the lender determine whether or not you can pay back the loan and whether you meet the requirements to refinance or not. Some of the documents they may ask for include the following:

• Recent pay stubs
• W-2 forms
• Bank statements
• Tax returns
• Business income statements
• Investment account statements
• Alimony and child support information, if applicable
• Copy of your government-issued photo identification
• Proof of legal U.S. residency
• Sources of funds

In certain circumstances, you will need to provide additional documentation. For example, if you are married, your lender may also ask to see your spouse’s documents as well. For those who are self-employed, more income documentation may be required.

After approval, it’s time to lock in your refinance rate. This is the interest rate you will pay on your loan. Once you have been approved and have found a rate you are happy with, you will sign a contract with the lender. This contract locks in your refinance rate for a certain period of time, typically 30 to 60 days. The period of time will depend on factors such as your location, loan type, and lender.

Locking in your interest rate prevents it from being changed before closing. Additionally, you may be able to float your rate. This means that if rates go up, you can lock in the lower rate. However, there is a risk with not locking in your rate as it may also increase.

When you submit your application, the underwriting process begins. During this process, the lender will verify your financial information and the accuracy of the information you provided. Details such as when you bought the property, how much you paid for it, and your current mortgage balance will all be verified.

After you have submitted your application and supporting documents, the lender will order an appraisal of your home. Then, an appraiser will come to your home and determine its value.

This information is then used by the lender to determine how much they are willing to lend you.

When having your home appraised, it is a good idea to be present. This way, you can ask the appraiser any questions you have about the process. Making sure your home is clean and presentable and that any minor repairs have been made is also a good idea. It is also advisable to make a list of upgrades that you have made since buying your home.

Once the appraisal is complete, the lender will give you a loan estimate, which outlines the terms of the loan, the fees, and the interest rate. If you’re happy with the loan estimate, you’ll then move on to the next step in the refinance process: signing loan documents.

After underwriting and the home appraisal are complete, it is time for the closing part of the refinance process. The closing is when the loan is finalized and you will sign the loan documents. A few days before closing, your lender will send you a closing disclosure which will include the final numbers on your loan.

Closing during the refinance process often is a much shorter process than buying a home. During the closing, the people on the loan and title and the representative from the lender or title company will be present. You’ll have an opportunity to ask any questions you may have about the loan documents before you sign them.

Once you have signed all of the loan documents, the transaction is complete and you will begin making payments on your new refinance mortgage loan. Or, if you are doing a cash-out refinance, you will receive your funds.