What do you need to refinance your home?

What do you need to refinance your home?

While specific requirements may be different from one lender to another, here is a list of what you can typically expect a lender to check when you apply for a mortgage refinance:

• Credit score: Credit score requirements may vary between lenders. Make sure you know what your lender’s minimum qualifying credit score is before you apply.
• Income verification: Your lender will want to make sure you have a steady source of income to repay a mortgage refinance.
• Home appraisal: To determine the current value of your home, you’ll likely be required to have your home appraised.
• Equity in your home: Your lender may require you to have a certain amount of equity in your home to qualify for a refinance.
• Debt-to-income (DTI) ratio: Your lender may look at your DTI ratio to see how much of your income goes toward paying off debts.
• Documentation: Be ready to gather various documents such as bank statements, tax returns, and any other financial information your lender may request.

Mortgage refinance document checklist

Refinancing your mortgage may help you save money, lower your interest rate, or change your loan terms. However, the process may seem complicated, especially when it comes to gathering all the necessary documents and information.

The types of documentation you may need for a mortgage refinance can be broken down into four main categories: your personal information, your employment/income information, your financial information, and your property information.

Personal information

• Full name. Your full legal name as it appears on current verified identification documents.
• Social Security number or Individual Taxpayer Identification Number (ITIN). Required of you and any co-borrowers. This is normally required for credit checks, identification verification, and other purposes.
• Date of birth. Lenders will use this to verify your identity, ensure compliance with lending laws, and carry out other tasks.
• Contact information. This may include your current address, phone number, and email address.
• Divorce or separation information. If this applies to you, your divorce decree, maintenance agreement, or other documents may be required. In addition, if you want alimony and/or child support payments to be considered income, then you may need to provide proof of payment history and other documentation.

Employment/income information

• Employer(s) verification. Names and addresses of your recent employer(s).
• Income verification. Recent pay stubs showing your earnings.
• Tax returns. Lenders may request your recent federal tax returns.
• Self-employment documents. If self-employed, be prepared to provide a lender with documents such as recent tax returns, profit and loss statement, and balance sheet.
• Proof of additional income. If you have additional sources of income, such as rental properties, alimony, or child support, you may need to provide documentation.

Financial information

• Mortgage statement. Your most recent mortgage statement, which should include your loan balance, interest rate, and payment information.
• Bank account(s) information. Account number(s) and current balance(s) of your checking, savings, or any other account(s).
• Assets information. Statements of current assets, such as individual retirement accounts (IRAs), certificates of deposit (CDs), stocks, and bonds. For individual investments, a current brokerage statement with the name of the stocks, the amount per share, and the number of shares owned.
• Debt and credit information. Names and addresses of all creditors, along with the monthly payment and total amount due for all debts. Your lender will generally pull your credit report as part of your application, but it’s a good idea to review it yourself beforehand to ensure there are no errors or discrepancies.
• Information about other properties. If applicable, documents showing all other real estate you own. If you have a rental property, you may be asked to supply a copy of the current lease.

Property information

• Recorded deed. Your deed will show the legal owner(s) of the property.
• Title Insurance.  A copy of your title insurance will help the lender verify any undisclosed claims or liens on the property, as well as other information.
• Homeowner’s Insurance. A copy of your homeowner’s insurance to show you have sufficient coverage for your property.
• Property tax statement. Your most recent property tax statement, showing the assessed value of your home, taxes owed, and other information.

FAQs about mortgage refinance requirements