DEBT CONSOLIDATION

Homeowners with property that is valued higher than the loan amount, have the option of a rate-and-term refinance or equity loan. A home equity loan is a second mortgage that lets you turn equity into cash, allowing you to use it for consolidating debt.

Rate-and-term refinancing pays off one loan with the proceeds from the new loan, using the same property as collateral. This type of loan allows you to take advantage of lower interest rate or shorten the term of your mortgage to build equity faster. The lower payment can then be used to pay other existing debts.

Coastal can do the legwork for you and assist you in determining if Refinancing is the right option for you. Our Certified Credit Advisor will provide a FREE customized financial analysis to help you make the decision. Call our Credit Advisors right now at 866-205-8370 or fill out the short form and we will get you started on the path to financial freedom. If Refinancing is the MOST appropriate option and you choose to work directly with a mortgage company, we suggest you ask ...

1. How long will it take to process my mortgage loan application?
Usually it takes about 45 to 60 days, although it can take as few as 30 days and as long as 90 days for some transactions. The actual time depends on how quickly the lender can get an appraisal of the property, a credit report and verification of employment and bank accounts.

2. What documents do I have to provide?
You will need to provide proof of income and assets in order to get a mortgage loan. Different lenders may require more or less of these documents.

3. What are the qualifying guidelines for the particular loan?
The qualifying guidelines can relate to your income, employment, assets and liabilities, and credit history.

4. What is the annual percentage rate of the mortgage interest?
To effectively compare different lenders' programs, ask for the annual percentage rate, or APR, of the mortgage interest, which is generally higher than the initial quoted rate because it includes all lenders' fees.

5. What are the points or origination fees on the loan, if any?
Points are prepaid mortgage interest, and you may have to pay points at closing in order to get a lower interest rate on your mortgage loan.

6. Can I lock in the interest rate?
The interest rate of the mortgage you're applying for may go up or down before you close on the home. That's why it may be wise to lock in the rate for a specified period of time, rather than let the rate float until the closing. Be sure to ask the lender if there is any fee for locking in the rate and whether you also can lock in points. To keep up with the daily changes in rates, check out bankrate.com's nationwide survey of mortgage rates.

7. What is the 'good faith estimate' of closing costs?
Mortgages come with a list of fees. Ask for a list of estimated closing costs before applying for the loan. See section on the Good Faith Estimate: More Fees at Closing. Also, remember that some fees must be paid upfront such as the credit report, property appraisal and loan application fee.

Find out if you can get a refund of the loan application fee if you change your mind. Some lenders may only refund the fee if they turn down your application.

8. Is there a prepayment penalty on the loan?
The prepayment question is for all loan shoppers. Find out the duration of any penalty period and how the fee would be calculated. Some penalties are 1 percent of the loan amount: others are more complicated. Knowing how much the prepayment penalty would be is important if you think you will sell the home before the mortgage is paid off, which most homeowners do.

9. What can delay the approval of my loan?
If you provide the lender with complete, accurate information, everything should go smoothly. However, there could be a delay if the lender discovers credit problems, which is why it is critical to get your credit in order. See the bankrate.com special report on credit reports.

10. How’s your BBB record?
Check out the company with the Better Business Bureau. Make sure that the company has resolved any complaints that have been filed.