How To Refinance Without Hurting Your Credit Score

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How To Refinance Without Hurting Your Credit
Score

• To refinance or not to refinance, is the question
  many homeowners ask themselves every day. This
  decision can be tough to make when you consider
  the long-term impact it could have on your credit
  score, which lenders use to determine whether or
  not youre worthy of the loan youre applying for
  (and what interest rate youll get). On the other
  hand, if you choose not to refinance, you may be
  missing out on thousands of dollars in savings
  each year on your home loans and lines of credit.

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Understand What Can Happen If You Dont Take
Action

• Before you refinance, consider what happens if
  you dont. If you continue making payments on
  your current loan, then your debt will not be
  improving on top of that, youll likely be
  paying a higher interest rate than you need to.
  In other words, no progress will be made toward
  either goal (debt repayment or home equity) and
  your monthly payment would likely increase over
  time. To make sure it doesnt come down to
  picking one or anotherand ultimately hurting
  bothyou should refinance as soon as possible and
  work with a professional who can guide you
  through a process that wont negatively impact
  your credit score.

Refinancing Actions You Can Take Today
Before you refinance, you should check your
credit score and determine how long its been
since you checked. If its been less than six
months, dont do anything until after your next
credit-score update. Checking your score
frequentlyevery three months or sois preferable
if you want to make sure your score is
continually in good shape. And if it isnt? It
may be time for some damage control with a good
service such as Lending Club or Credit Karma.
These services can help you monitor your score
and flag any issues that need attention. They can
also give you advice about how to fix those
issues.
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Three Suggestions For Maintaining A Good Credit
Score During The Refinance Process

• Follow your lenders guidance Lenders have an
  incentive to keep your score high because it
  reduces their risk and helps them get paid
  faster. If they tell you how and when you should
  pay off loans or make payments on accounts that
  arent being closed as part of your refinance,
  follow their instructions.
• Dont close credit cards unless necessary
  Closing credit cards may reduce your score by a
  small amount, but not closing them could hurt it
  even moreremember those known unknowns? You can
  lower the average age of your accounts by
  regularly charging purchases, then paying them
  off in full every month, for example.
• Keep using your old account(s) It might seem
  counterintuitive, but if youre able to maintain
  at least one account with a balance after
  refinancing, it will help preserve your score. As
  long as you continue making payments on time and
  keeping balances low (ideally less than 30 of
  your available credit), lenders wont see any
  reason to ding you for having too much available
  credit.

Finding An Approved Lender
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Getting The Best Rate Possible

• Youve decided its time to refinance your
  mortgagewell done! But now you need to make sure
  you can get an approved lender. Of course, you
  want a good interest rate, but there are other
  factors at play as well. Think about your overall
  financial situation before searching for lenders.
  For example, you may not want a long-term
  commitment or additional debt on top of what you
  already have on a home equity line of credit
  (HELOC). Be clear with yourself and discuss
  things with your lender so that he or she knows
  what direction you are headed in.

Keep in mind that lowering your rate or fees is
only one step in getting your credit score up.
Youll also want to pay off any high-interest
debt, stick with all of your bills on time, and
dont open too many new accounts. High
utilization rates (exceeding 30 of total credit
lines) can affect scores. If you have a lot of
available credit, you might consider closing
unused accounts or moving existing balances to
lower-interest cards. However, keep in mind that
closing an account can potentially reduce your
overall credit limitand lower your score even
more! If youre approved for a balance transfer
card, move your current balance to it before
doing anything else. That way, if something goes
wrong with your application process or if youre
denied for some reason, at least there will be no
negative impact on your credit score.
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Assess What Refinancing Can Do For You Now And In
The Future

• A balance transfer card may offer 0 interest for
  12 months or longer by using it to consolidate
  higher-interest debts into one low monthly
  payment, you could save hundreds of dollars per
  month over those 12 months alone.

While its a relatively simple process,
refinancing is still an important one. You may be
able to lower your monthly payments and
ultimately save money on interest if you can
refinance at a lower rate than what you currently
have. Although refinancing can provide immediate
savings, it wont help you if you get in over
your head financially or need to make drastic
cuts in your spending nor will it do much for
your credit score. Always look at all angles
before deciding whether or not refinancing is
right for you. The more information you have, the
better decision you can make for yourself and
your family (if applicable). If you decide that
refinancing is right for you, remember that there
are many options out theredont just choose
whatever comes first! Be diligent about shopping
around so that you can find a lender who meets
your needs while also helping to improve your
financial future.
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Contact Us

• Address - 18930 HWY 18 STE 101 Apple Valley CA
  92307
• Email - info_at_thecreditscoreking.com
• Phone - 1 909-329-4882
• Website - https//thecreditscoreking.com/
• Blog - https//thecreditscoreking.com/how-to-refin
  ance-without-hurting-your-credit-score/