No longer being able to afford your mortgage loan doesn’t need to mean moving out of your home or falling into foreclosure. The right refinance can help you get a lower interest rate, decrease your monthly payment or take cash out of your home to cover high-interest debt. If you think a refinance might be right for your Nevada home loan, be sure to read our guide on the many types of refinances and the best place to refinance a mortgage loan in the Sagebrush State.
Best Refinance Lenders in Nevada
From online mortgage lenders like Quicken Loans’ Rocket Mortgage platform to local lenders like Bank of America, you have plenty of options to choose from when you refinance your loan in Nevada. If you don’t already know where you’d like to refinance your loan, consider a few of our top picks below.
Current Nevada Refinance Rates
When you refinance a mortgage, your lender will allow you to lock into a new loan with a new interest rate. The rate you’ll receive may vary depending on how market rates in your area are changing. If rates have gone down since you got your original loan, you might be able to save money by locking into a lower interest rate.
Here’s a sample of what you might expect to pay for your loan in Nevada if you took it out today.
|7/1 ARM (adjustable rate)
|5/1 ARM (adjustable rate)
No matter where you decide to refinance your loan, you’ll go through a streamlined refinance process. This process is similar to the process you went through when you first took out your mortgage loan but generally includes fewer steps. Refinances are also much more affordable than new mortgage originations.
Before you apply for a refinance, decide what you’d like to get out of your new loan. Not every lender offers every type of refinance option. Defining your goals before you apply will help ensure that you find the best lender to service your refinance.
Some goals you might have for your refinance might include:
- Taking on a new monthly payment by lengthening or shortening your mortgage term
- Lowering what you pay in interest by locking into a new rate
- Refinancing from a government-backed loan to a conventional loan (or vice versa)
- Taking cash out of your built equity with a cash-out refinance
After you define your goals, choose a lender to work with and apply for a refinance. Most lenders now allow you to apply for a refinance entirely online but you might have the option to apply in person if you choose a lender with physical branches.
When you apply, your lender will ask you for financial documentation to prove your income and assets. Though the specific documentation your lender will ask for may vary, you should expect to provide your lender with your 2 most recent:
- Pay stubs
- W-2 forms
- Monthly bank statements
Most lenders will provide you with a decision shortly after applying. If you’re approved, your lender will begin the underwriting process. During underwriting, your lender verifies the information submitted on your application and runs a credit check. In most circumstances, underwriting takes place entirely behind the scenes.
Your lender will also schedule a new appraisal under most refinance processes. You’re free to attend your new appraisal to ensure the highest possible value estimation. Some steps you can take to increase your value estimate include:
- Documenting upgrades. Have you made permanent upgrades to your home since you moved in? Create a list of renovation projects and appliance replacements you’ve made since you bought your home and present it to your appraiser during your appraisal. It can be hard to spot a new dishwasher if you don’t know to look for it.
- Make any needed repairs. If you have minor repairs hanging around your to-do list, be sure that they’re completed by the time your appraisal date arrives.
- Clean up. Ensuring that your home is clean and quiet will help your appraiser see the true condition of your property. Tidy up before your appraiser arrives, ensure that pets are in their crates or otherwise out of the way and be sure that there isn’t excessive noise in your home.
After your underwriting and appraisal processes close, your lender will send you a document called a Closing Disclosure. Your Closing Disclosure contains the final terms of your loan, including what you owe in closing costs.
Acknowledge your Closing Disclosure with your lender to receive a closing meeting date. At your closing meeting, you’ll pay your closing costs and sign onto your new loan. After you walk away from closing, your refinance is officially complete.
When Should You Refinance in Nevada?
If your mortgage loan is no longer working for you, a refinance might be the solution. Some of the benefits you can take advantage of when you refinance include:
- Lowering your monthly payment. When you refinance to a longer term, you lower what you owe each month. This can help you avoid foreclosure if you now have less income when compared to the date you took out your loan.
- Pay off high-interest debt. Mortgage loans typically have much lower APRs than credit cards or other types of loans. If you have high-interest debt, you can consolidate what you owe and save money by taking a cash-out refinance.
- Lowering your interest rate. Are average mortgage rates in your area lower now than they were when you took out your loan? Save money each month and over time by locking into a lower rate through a refinance.
When Should You Not Refinance?
Even if you’re working with one of the best refinance mortgage companies in Nevada, a refinance cannot solve every problem. Before you apply for a refinance, you should know your interest rate and current equity. Most mortgage lenders won’t allow you to take out more than 80% to 90% of your built equity. This means that if your loan is very new, you might not have enough equity in your property to justify taking a cash-out refinance.
You should also check on current mortgage interest rates in your area before you make the decision to refinance. If rates are higher now than they were when you got your loan, you might end up paying more money in extra interest than you save when you refinance. You should also make sure that you can pay your closing costs up front when you close on your refinance before you apply.
Finally, if you’re thinking about refinancing to a shorter term, consider making extra payments on your loan instead. Most mortgage loans don’t include stipulations that penalize borrowers for making extra monthly payments directly to their principal balance. If you want to own your home sooner, you might be able to schedule extra monthly payments directly through your lender without the hassle or expense of a refinance.
Bad Credit Refinance
If you have bad credit, you might have trouble finding a new mortgage loan. Like when you apply for a new mortgage loan, your lender will check your credit score and your credit report as one of the first steps in the refinance process. If you have lower credit, you’ll pay a higher interest rate and you’ll be limited in the number of lenders you can work with.
There are a few ways that you can refinance your mortgage even if you’re still working on building your credit score. If you have an FHA loan or a VA loan, you might qualify for a streamline refinance (FHA) or an interest rate reduction refinance loan (VA). Both the streamline and interest rate reduction refinances can allow you to get a refinance without a new appraisal or credit check. This can allow you to refinance your loan even with bad credit.
If you don’t have a government-backed loan, you might want to consider refinancing with a non-occupying co-client. A non-occupying co-client is someone who doesn’t live on your property but who agrees to pay your mortgage payments if you default on your loan. Adding a co-client to your loan makes you a safer bet to a lender but remember that your lender can pursue your co-client for your outstanding loan balance if you fall behind on payments.
One important thing to note: Even the best mortgage company won’t allow you to take a cash-out refinance without meeting minimum credit requirements. You may only refinance your rate or term with a bad credit score. If you have bad credit and you need to take cash out of your home equity, take a few months to boost your score before you apply. Some steps you can take to improve your credit score include:
- Paying all of your minimum monthly payments on time
- Limiting your credit usage, ideally to less than 10% of your total available credit each month
- Disputing inaccurate items on your credit report
How to Start the Refinance Process
Is now the right time for you to refinance in Nevada? The answer will depend on your unique needs as a homeowner, the current interest rate and the length of time that you’ve had your loan. If you’re thinking about applying for a refinance, contact your current lender and request a new mortgage statement. Your mortgage statement will tell you more about your current interest rate, principal balance and equity, which can help you decide if a refinance can help you meet your goals.
Get Ready for Take Off
Rocket Mortgage® is an online mortgage experience developed by the firm formerly known as Quicken Loans®, America’s largest mortgage lender. Rocket Mortgage® makes it easy to get a mortgage — you just tell the company about yourself, your home, your finances and Rocket Mortgage® gives you real interest rates and numbers. You can use Rocket Mortgage® to get approved, ask questions about your mortgage, manage your payments and more.
You can work at your own pace and someone is always there to answer your questions — 24 hours a day, 7 days a week. Want a fast, convenient way to get a mortgage? Give Rocket Mortgage® a try.
About Sarah Horvath
Sarah is an expert in the insurance, investing for retirement and cryptocurrency space.