Prefer to talk in person? Find a mortgage specialist on Zillow
Profile picture for 3des

Preparing for Refinance Question

Preparing to Refinance Questions 

  1. We want to start the process of refinancing as soon as possible, but I want to know if its better to pay off as much debt as possible before we start the process or is it better to have the cash in the bank?
  2. What's the best way to refinance? Use online company, a bank, or a local mortgage company?

Thanks in advance for any advice we receive.

  • February 18 2014 - Chesterfield
  • 0
    0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Be a Good Neighbor. Be respectful and on-topic. No spam or self-promotion! See our Good Neighbor Policy.

Answers (13)

3DES,

Since my response got "moderator(ed)" lol....I would say this. There is no best way to refinance as the question is too vague. What you may deem as the best way could be different to someone else. A good loan officer will ask you what is important to you specifically and they will strive to meet that guideline.

As far as money in the bank, why spend it if you do not need too to get a loan? See what the professionals come up with.
  • February 25 2014
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Talk to a bank (usually poor choice but not always), a direct lender (they are all different) and a broker(they can shop rates). I am a direct lender and a broker(I was a banker at very large Bank). Sometimes I have a better rate with my direct division but often times I get better rates on the wholesale market. I have 70 lenders to shop from on that side. If you use a broker make sure they are large and have over 50 wholesale lenders to shop from to make sure you are getting the best deal.
  • February 19 2014
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for CA Direct Lending
"use a local bank...you are guaranteed to get better service"

Really?  Have you seen Citibanks ratings and read their reviews?  I think the only thing you can guarantee is that you'll be the one writing another poor review. 
  • February 19 2014
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

This is a good question to ask Realtors because they deal with mortgage companies all the time. 99% of them will tell you to use a local bank. You will probably get a better deal and you are guaranteed to get better service.

I recommend not paying off any debt until you speak to a reputable Lender who runs your credit and can give you guidance on how to best allocate your money.


Best,
Zac

  • February 19 2014
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for CA Direct Lending
I would enter your scenario using the Mortgage Rates tab above.  You'll get a list of lenders with the lowest rates as well as see their ratings and read what past clients have said about their experience with them. 

For the most part, I think it's always better to have cash in the bank.  Some high-cost debt should probably be paid, but that is something to talk about with your experienced lender.  If you qualify with your existing debt, there may be no reason to pay it off. 

If you find a lender on Zillow in the Mortgage Marketplace, you'll already know the rate you should get based on the information you entered as well as become confident in their abilities after reading their reviews.  Then call a few and make sure you're completely confident.  There is no reason to take your chances by walking into a local bank or mortgage company.

Whoever you choose, Google their name and their company to see what reviews or other information you can find.
  • February 19 2014
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for New American Funding
You will want to reach out and interview a few lenders and see what options you have available.
  • February 19 2014
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Yes, everyone else is correct. Speak to a lender first before doing anything, they can tell you the best course of action. It's better to know exactly what you need to do rather than guess and possibly get it wrong. 
  • February 19 2014
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Hello,  You may not have to payoff any debt at all.  We can approve your upfront before you pay any apprasial fee's.  Happy to help you
  • February 19 2014
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

I agree with most replies. Before you pay off anything, talk to a lender to determine what is in your best interest. A experienced loan officer will be able to determine what and if you need to pay off anything before you refinance.

Good luck.
  • February 19 2014
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

 3des,

I am a local lender that is 20 minutes from Chesterfield.[Content removed due to promotion. Please refer to our Good Neighbor Policy for more information.]
  • February 19 2014
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

First, please don't do anything regarding paying off debts until you speak with a lender, as this could affect your credit score. Let your lender help you decide whether paying off a debt is in your best interest.

Most importantly, there is no need to have your credit report run by multiple lenders in order to select one that you want to work with. Inquire, as you are doing now. That is a good start. Find the right match for you and how you like to communicate.

Maybe you prefer to have your lender right down the street? Some people prefer this. Possibly, it doesn't matter as long as you have a good initial conversation. Gigantic mortgage lenders do present a problem because of the sheer volume machine.

Most lenders have applications that can be digitally signed and documents emailed or faxed. If you inquire with a lender and don't get a personal prompt response, take that lender off your list.
  • February 18 2014
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

I agree with Brian. Getting at least 3 quotes from 3 different Lenders is your best bet. If I can help reach out to me via my profile here.
  • February 18 2014
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

The only way to know for sure is to talk to a loan officer licensed in your state and have them run the numbers.

If you do not qualify because your debt to income ratio is too high, then you may have to pay off debt to get approved for the loan.

If this is your primary residence, the bank does not have a "reserve requirement" so it would not be necessary to have cash in the bank. 

The best way to refi is to get several quotes and research the companies online (Better Business Bureau, Zillow reviews, etc...)   Most people don't trust the companies they find online and prefer face to face dealings. However from my experience, many of the online lenders have the best rates, lowest fees, and still provide excellent customer service.

You can search for lenders here on Zillow  or go to bankrate com 

 

  • February 18 2014
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.