You need a lot of documents proving that you are ready to refinance.
The documents you should have on hand include your last pay stubs, the last two years of W-2, information on your current home loan, as well as information on property taxes and home insurance.
If you are self-employed or have a non-traditional job, have two years of bank statements. You may also need an income statement from your bank, past two years 1099 forms, and customer invoices as proof of income.
A lender may have additional documentation requirements depending on their initial assessment of your finances. Once you’ve chosen a lender, find out about all the other requirements so that you can get them together in advance. This will make the application process much smoother.
6. Find a mortgage lender
Don’t settle for the first interest rate offered to you. You need to compare the rates and terms of at least three refinance lenders to see which one offers the best plan for your needs.
You should also consider different types of lenders. Compare rates from major banks as well as online lenders and local credit unions. If you have a long-standing relationship with a financial institution that also offers home refinancing, check with them as well. You may be able to negotiate a better rate if you already have other financial transactions with the lender, but not always. Do not assume your current lender offers you the best deal.