Refinancing can be a great step toward your financial or home improvement goals. Lowering your monthly payment, reducing the amount of interest paid over the life of a loan, eliminating private mortgage insurance or getting cash for a home improvement project are all great reasons to consider refinancing.
Our team has helped more than 46,000 clients
We guide you through the process with full transparency, excited to answer your questions along the way. We currently offer services in the mid-Atlantic region, striving to make homeownership a simple, painless and money-saving process. In this guide, we'll give you an overview of home refinancing through CapCenter.
Step 1: Set Your Goals
The first step in any refinance is to identify exactly what you'd like to accomplish. There are a few reasons that you may be looking to refinance, you'll just have to identify them.
What do you want to get out of this refinance?
- Lower Payments: Decrease monthly payments through a lower interest rate.
- Consolidate Debt: Combine your debts into one monthly payment.
- Home Renovations or Improvements: Use the equity in your house to fund a renovation.
- Take Cash Out: Trade equity for cash.
- Shorter Loan Term: Pay off your loan quicker by shortening the repayment period (i.e. 30-year to 15-year). This often leads to savings in lifetime interest.
- Add or Remove Others From the Loan: Change in relationship?
- Other: There are a range of other options, including changing your loan type or switching from an adjustable-rate mortgage (ARM) to a fixed-rate loan.
How long do you plan on being in the home?
Determine your short- and long-term goals. Customers looking to gain equity quickly will most likely want to explore the option of a short loan term. Shorter loan terms allow you to pay less interest over the life of the loan and due to higher monthly principal and interest payments you are able to accrue equity quicker. Loans with longer terms are great for those looking to keep a low monthly payment but save money over the life of their loan by reducing their interest rate. If you have home renovations on your mind, you might consider a cash-out refinance to access your equity.
What is your financial situation?
You are entitled to a free credit report per year from each of the 3 major credit bureaus. Make sure to understand what is on your credit report prior to applying for a refinance so there are no surprises. Other things to have on hand and be ready to discuss are your employment history and current income, any liabilities and debts that require monthly payments, and your goals for your refinance! Your loan officer is a great resource to help you find the best option for your current situation.
What loan term should you apply for?
Check your current mortgage statement. This will show you your principal balance, which will give you an idea of the minimum financing you will need to apply for. It will also show your current interest rate, monthly payment, and remaining loan term. With this in front of you, you can easily compare your current mortgage to a CapCenter refinance. Your loan officer will be available to walk you through loan options to compare the benefits of different refinance options.
Step 2: Understand Your Options
All of the questions in Step 1 lead to a larger question: is refinancing worth it? Sometimes this question depends on the lender.
The great thing about a CapCenter refinance is that we cover all traditional closing costs, which saves our clients thousands of dollars. So, if a refinance doesn't make sense with another lender, it may be a no-brainer with CapCenter.
Crunch the numbers
Working with a refinance calculator will give you a good idea of what to expect. Once you've decided to refinance, use our mortgage refinance calculator to help you find the best mortgage for your needs. After inputing your data, the tool will calculate your new payment, cash to close, and monthly savings. These are just a baseline so make sure to have a conversation with your loan officer about your refinance goals as well.
Not sure of your home's value?
That's OK! Automated valuation models, comparative market analysis tools, appraisers, real estate agents and tax assessors all have different methods for determining a home's value. There are numerous public resources for exploring your home's value, but none of them is without its faults. Still, understanding your home value through an internet tool like CapCenter's Home Estimate will help you better understand the benefits of a refinance.
Once you submit your application and start the process with us, our in-house team of mortgage and real estate professionals has tools and insights to identify the real value of your home.
Step 3: Apply Online
Our online refinance application is free and only takes about 15 minutes to complete. Once you submit your application, it will be assigned to a CapCenter Loan Consultant who will review it and reach out to you. Your Loan Consultant will assist you every step of the way and will be happy to provide options and answer any questions you may have.
After your loan consultant receives your application, they will order a credit report and get your mortgage pre-approved. Next, we'll prepare a formal Commitment Offer that outlines the key mortgage details along with any supporting documentation we might need to move forward on your new mortgage. We will provide the Commitment Offer for you to sign through a secure online portal.
Among other things, this package contains an official Loan Estimate (LE) with an itemized breakdown of all costs covered by CapCenter's Zero Closing Cost offer. If you are shopping around, the LE is the easiest way to compare offers line by line.
Shopping around isn't necessary once you have your CapCenter Loan Estimate in hand, but it won't be discouraged. If you think you've found something better, let us see if we can beat it!
Step 4: Provide Documents & Lock Your Rate
Your Commitment Offer is valid for 30 days after we issue it. You can accept the offer by signing documents either electronically through our secure online portal or printing, signing and delivering them in person. After signing your Commitment Offer, we'll ask you to pay a Good Faith Deposit. You will pay the deposit online using a credit or debit card. It will be refunded back to that card once you close your loan.
Provide Documents
Baseline Value: Your Commitment Offer will provide a list of documents needed to proceed with your loan. We'll eventually need everything outlined to close your loan, but may need only partial information to get your interest rate locked. There's no need to put off signing your commitment offer — which positions you to lock in the best rate — while you locate documents.
Lock Your Rate: After your Loan Consultant reviews your signed Commitment Offer and reviews your submitted documents, he or she will work with you to lock your interest rate.
Most of our borrowers choose to lock their rate in a phone conversation with their Loan Consultant. If you are not available for a call but want to lock your rate, your Loan Consultant can make other arrangements. Please note that once you lock in your interest rate, it's locked. You can still change some loan details, but your rate will not float up and down with the market.
Rate Lock Requests
Rate lock requests are accepted between 10am and 4pm, Monday through Friday. Exceptions include any holiday observed by the stock market:
- New Year's Day
- Martin Luther King, Jr. Day
- Presidents Day
- Good Friday
- Memorial Day
- Juneteenth
- Independence Day
- Labor Day
- Thanksgiving Day
- Christmas Day
Step 5: Close and Celebrate
When you've locked your interest rate, we'll work with you to schedule a closing date. We'll make sure the date fits your schedule and allows plenty of time for a full underwriting of your loan.
During the period between rate lock and closing, your application will be assigned to a Closing Consultant. They will work to collect remaining documents and make sure everything is in place for final underwriting.
Closings don't take long — usually 20 to 30 minutes for most homeowners. Closings take place in our office unless you live outside one of our markets, in which case we'll send someone to you. Digital closings might be available in some markets. Regardless of how or where you close, you will work with a knowledgeable professional prepared to answer any questions.
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