You’ve decided that the time is right for you to refinance your mortgage and lower your monthly payments. It’s a great idea, and it’s something everyone with a Gilbert AZ mortgage should do, especially if there’s a large difference in the prevailing interest rates vs. when the loan was originated. Less pressure on the budget is always a good thing. But first, you need to make sure that everything, especially your credit rating, is in order when you come to us at Starboard Financial.

Your credit rating plays an important role in your ability to get a lower interest rate on a Gilbert AZ mortgage. Here’s the logic behind a lower credit rating: a lender wants to know that they are dealing with a credit-worthy individual. In order to determine this, the lender looks at your credit history with various credit bureaus. If you have worse credit than when you initially bought the home, the lender is less likely to give you a better interest rate due to the fact they don’t feel you are responsible with money. As a result, you get placed into a higher risk category, and you may even be offered a higher interest rate than what you currently have. Your credit rating can make or break your ability to lower your payments.

Sometimes, life happens and your ability to keep up with your bills slips a bit or someone gets access to your personal information and starts opening unauthorized credit cards. In either case, you need to fix these issues before you look into refinancing your mortgage. Creditors report these items to the credit reporting agencies and unfortunately, your scores will drop. Even if you aren’t planning on purchasing or refinancing a home in the near future, it is still a very good idea to check your credit score with the credit bureaus, periodically, in order to prevent unexpected items from popping up when you need your credit rating to be in great shape.

Fixing your credit rating involves getting your credit report and finding all errors or strikes against you. Each error or strike needs to be identified and addressed individually for the best chance of success. You also need to make sure that each of the reporting agencies updates your profile to reflect the removal of the negative marks in order to improve your score. If you’ve been consistently late on bills, make an effort to get back on track and pay bills on time. This also lifts your credit score, enabling us to help you get a better interest rate when you refinance your Gilbert AZ mortgage.

If you have decided that you want to refinance your home loan on your Gilbert AZ mortgage, then contact us at Starboard Financial and we will help you decide if this is the right option for you.