In past topics, we covered jumbo loans, which are typically used to finance high value homes and larger than standard mortgages. Many people get approved for jumbo loans that have high rates in this somewhat riskier mortgage. If you have a jumbo loan, you may want to refinance and restructure as you pay it off. Check today and see if you can get better interest. This week, Stonebriar Mortgage is here to educate Dallas, TX and California homeowners about jumbo loan refinancing.
Qualifying for a Jumbo Loan
Jumbo Loans are also known as non-conforming loans because they exceed limits established by government agencies. For this reason, someone may need to undergo more scrutiny to seek approval for a jumbo loan. These loans are not approved for government backing, so you will also need a good financial history to qualify to refinance a jumbo loan.
Qualifying to Refinance a Jumbo Loan
Qualifying to refinance a jumbo loan may prove very difficult and will come with additional fees, since some jumbo loans are quite large. The size of the loan means that interest payments can really add up over time, so it may be worth the effort to refinance and save. You can do a financial projection to see if the initial costs warrant the savings. If you decide to go for it, prepare to provide ample documentation.
Many lenders desire to see a good credit score and loan-to-value in order to approve a jumbo loan refinance. Some people have adjustable-rate mortgages and are looking to save on interest, others apply in order to pull out cash from the home. Your debt-to-income ratio must be under 43%. You will also need to show proof of other sources of cash and financial reserves. There may also be limits on the number of properties you can hold mortgages on in order to qualify.
Gathering Documents to Qualify for a Jumbo Loan Refinance
In the process of refinancing a jumbo loan, there is ample documentation that you will need to gather. You will want at a minimum:
- At least two years of tax returns.
- At least two years of W-2s.
- At least one to two months of pay stubs and bank statements, including ample evidence of commissions earned (if needed).
- If you are self-employed, you will need to provide profit and loss statements for your business.
Finding the Right Time to Refinance
Be sure you look closely at your credit, debt-to-income, and loan-to-value in order to learn if it is time to refinance your jumbo loan. Qualified professionals are here to help. Stonebriar Mortgage works with Dallas, Texas and California homeowners for Jumbo Loan Refinancing. Please contact our office with any additional questions.