How To Get A Refinance Home Mortgage Loan Application Approved Easier

When a homeowner applies for a refinance home mortgage loan

, the mortgage underwriter looks at several important points to decide to offer the loan or not. Although the forms may be quite long the main list is not that long. If the lender is not satisfied with one on the items in the list, they would decline the mortgage application. These essential check points are;

1. Household income. Normally the mortgage companies have their tight guidelines at to how much they could offer to an applicant based on their earnings. This could be 3-4 times of the total incomes of the applicants. Or they may use a monthly payment related income check that requires the monthly mortgage payments not to be more than certain percentage of income. They would certainly look at the stability of the job and may require confirmation. For the self employed they would need certified accounts for 3 years.

2. Income and Expenditure Statement. Most lenders will require the applicant to fill in their house hold income and expenditure. This includes, loan, credit card, car loan payments, utility bills, grocery spending, school fees on one side and all the possible incomes on the other side. This statement shows how your income spent and what is left for the mortgage and other savings. Most mortgage companies would not keep it tight. They would expect some money left for savings or rainy days.

3. The Equity on the Property. The higher the equity on the property after the proposed borrowing the better the chances of getting the refinance home mortgage loan approval. The homeowners usually have a very good chance of approval if the equity is more than 20% of the appraisal value of the property.

4. Credit Report. Credit report can be considered as a reference to a prospective lender from previous creditors of the applicant. At this stage, your credit score may me more important than your name, because a loan officer would want to know your credit score, before they want to know your name. That is why one of the first things people considering refinance should do is check their credit report. With a good credit score, not only the applicant gets approved but may be offered a better mortgage interest rate.

Anyone who is considering refinancing should start preparing wage slips for at least 3 months, 6 months bank and credit card statements and any savings books. Applicants who satisfy the above requirements would be in a strong position to go after the best refinance home mortgage loan rates in the market. Extra care should be taken when filling the mortgage application forms to avoid it coming back as incomplete. The form should be filled thoroughly to reduce the mortgage officer coming back for more information again and again.

by: jslee

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