Just a tip to share if your son or daughter will be taking out a student loan for which you will be a co-signer and you are also going to be refinancing your home mortgage. I would suggest you refinance 1st if you have the time, just because now that we are refinancing, we found out the the mortgage company looked back in the past 120 days for any credit inquires and now we have to disclose/explain the student loan. Even though the payback doesn’t start until 6 mos after may 2018. I don’t think it will be a problem, it’s one more thing that popped up that we have to deal with. I don’t remember refinancing being so complicated and time consuming.
@rumrunner the mortgage industry has become very careful about financing…and refinancing…after the real estate collapse due to over funding a LOT of people.
If you are cosigning a college loan, it is NOT a “student” loan (in the name if the student only). It is a college loan for which you hold equal obligation for repayment. This will show up on your credit check. Or it’s a Parent Plus Loan, which is in your name only.
And lastly if you refi first, who is to say you will receive a college loan as easily?
was thinking that same thing as I was writing
This is an SOP now for any underwriting process for a mortgage loan. You have to explain any credit inquiry.
It’s much more difficult to refinance nowadays than it is to get a college loan so I suggest refinancing first. It took me about 5 minutes to get a substantial Parent Plus loan - no income or asset documentation, no debt to income ratio requirements - just need a good credit score. I was shocked by the ease of borrowing so much money. I can see how people, especially those who aren’t financially literate, can easily over extend themselves.
The banks and mortgage companies don’t care and would love to refinance without all those pesky credit checks and income verifications. Their regulators, however, view things differently! Dodd-Frank changed it all, tightened the ratios needed, and sent everyone and his brother to examine the paperwork.
It took me over 4 months to refinance my mortgage. They kept on asking for more and more documents, it was never ending. I was so tired of explaining everything (they were all legit) that I told them I didn’t do it any more.
Yes, I would refinance first then get other credits later. It’s much easier to get a student loan or credit card. The reason being they are not under scrutiny by the regulators. Their interest rates are also a lot higher. Losses could often be covered by those excess spreads.
@oldfort
I just recently refinanced our rental property. It took us 2.5 months. I thought that was long until I saw your post. But just like you it was a lot of paperworks. In part because it was an investment property.
I have worked in mortgage lending for the majority of the past 30 years. I would now describe it as agony! Looking forward to retirement. The concept of applying common sense is gone. The concept of making a judgement based on LTV, income and credit is gone. The focus is on documentation, documentation and more documentation so that if the borrower defaults - the lender is protected from an investor making a repurchase request and/or the defaulting consumer suing with a claim of being placed in an inappropriate loan. It is excruciating. We could benefit from a refi - but I don’t have the patience/endurance to do it.
We just refinanced our mortgage. It was fast and painless. I had a list of documents to provide which I gathered together. I think I sent in the paperwork on a Monday and it was approved on Thursday. This was with the same company that the original mortgage was with and our finances are pretty simple. I was nervous about the appraisal but it came back with an acceptable number.
I was nervous because I’ve heard that it’s becoming more difficult and more documentation but sorry we didn’t find that. My sil and bil own a business and their refinance took forever and tons of documents.
We went from a 5.49% 30 year mortgage to a 3% 15 year mortgage.
Congrats @deb922. It’s great to pay less interest and more principle (sp?), especially if your pay,net is about the same.
thanks folks