Hawkeye Associates Reviews Show Homeowners Taking Advantage of Low Interest Rates and You Can Too

If you own a home, you might consider refinancing to take advantage of the low interest rates banks can offer. But qualifying for a refinance isn’t much different than qualifying for an original mortgage, so you need to have your ducks in a row before you call the bank. With the high unemployment rate through the majority of 2020 and into 2021, you may have had to rely on credit to make ends meet. Any debts you carry will show you as a risk to banks, and they’re less likely to approve you for refinancing.

Since you don’t know how long the federal government will keep interest rates low, driving mortgage rates, it’s best to look at your budget now and assess your readiness.

Examining Your Budget

One of the first places banks will look to determine whether you can refinance or not is your ability to pay, so you need to get your budget in a favorable position. That means determining where your money goes every month, your inflows and outflows of cash, and your debts.

First, write down your income sources and all your expenses for the month and subtract the two. If you have a positive number, you can cover all your expenses with money left over, but if the number is zero or negative, you’re living paycheck to paycheck or charging the difference each month. Remember, banks want to assess your ability to pay monthly on the loan they offer you, so you have to show them that you can pay. Even if you have a positive difference between your income and expenses, you can still rework and make that number bigger.

The only way to widen the gap between your inflows and outflows is to increase your income or decrease your expenses. With the vaccination program underway and businesses opening their doors again, you might be able to pick up a side job to increase your income, or you could ask for a raise from your current employer. In addition to increasing your income, look at each bill in your budget and decide if it’s a necessary expense. For example, unlimited data on your phone and Netflix are not must-haves, but food and water are.

Paying Off Your Debts

If you carry credit card debts, the bank will see those as a negative against your refinance eligibility, so paying those off should be a top priority. See if Hawkeye Associates can help you by rolling your credit card balances into a debt consolidation loan. That way, instead of making multiple minimum payments, you can have only one and use the extra money to get rid of your debt quicker. 

Freeing up cash in your budget should show the bank that you can handle a refinance on your mortgage. And the more you lower your outstanding debt amount, the better your chances of securing a new loan on your home.

Refinancing Your Home Loan

Once you have your budget in order, it’s time to approach the bank to explore refinancing your home and taking advantage of low interest rates. With the world in a state of flux, not even the experts know how long the Fed will keep interest rates low, so the time to explore refinancing is as soon as possible.

Revisiting Your Finances Periodically

All the work you do on your budget doesn’t end with a successful refinancing of your mortgage. For instance, if you continue to charge on your credit cards, your debt consolidation is for nothing, and you won’t be able to build a solid and sustainable financial foundation.

Be sure to live within your means and only spend what you bring in while also setting money aside money for saving and investing to grow your bottom line. As long as you keep a watchful eye on your cash flows, there’s no reason to believe you won’t hit your financial goals.

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