Refinance Before Selling: Timing and Strategies
Refinancing your home before selling is a good way to boost the value you can get from it. This article details helpful timing and strategies for a successful refinance.
What Is Refinancing Before Selling?
Refinancing before selling is a strategy that allows homeowners to pay off their current mortgage and replace it with a new loan at a lower interest rate at the same time of selling their home. Refinancing can be a great idea if you're trying to get the best return on your sale, as it can help you to maximize profits on the deal.
Timing Is Everything When Refinancing and Selling
The timing of refinancing your mortgage before selling your home is crucial. You should consider whether you have enough time to successfully refinance your loan prior to the sale. You'll also need to be aware of the impact that the refinance may have on your closing costs. A late refinance could also push back your closing date and leave you without funds to pay your closing costs.
If refinancing before your sale, you also need to keep in mind that the refinance process can take some time. The timeline for this process includes such steps as applying for the loan, getting a good-faith estimate, going through the underwriting process, and finally, closing the loan. All of these steps can take anywhere from a few weeks to a few months.
Strategies for Successfully Refinancing and Selling
If you're considering refinancing before selling, there are a few strategies to help ensure a successful process. First, if possible, you will want to initiate the refinance process well ahead of time so that you are not rushed as you work through the steps. This allows you the necessary time to get everything in order to ensure that you get the best rate on the loan.
It's also important to ensure that your credit score is in its best shape before applying for a refinance. You can do this by checking your credit report for any discrepancies. Any issues that can be cleared up should be addressed as soon as possible. This will help to prove your overall creditworthiness and help you to secure the lowest interest rate.
Call a Mortgage Professional for Advice
If you're considering refinancing before you sell, it can be a smart move that will help you to maximize your profits. However, it's always a good idea to seek advice from a mortgage professional before initiating the process. They can help you with the timing of the refinance and whether or not it is the right move for your current situation.