What to Gather Before You Refinance Your Mortgage

Start with your current loan documents

Before you contact a lender, pull together your existing mortgage paperwork. You need your current loan estimate or closing disclosure — the document you signed when you first got the mortgage. This shows your original loan amount, interest rate, and remaining balance. If you cannot find the original, your current servicer (the company you send payments to) can provide a statement showing what you owe and your rate.

You also need recent payment history. Most servicers show this online or in your monthly statement. A lender will want to see that you have made on-time payments, especially in the last 12 months. If you have missed payments or paid late, be ready to explain what happened — a temporary hardship is different from a pattern, and lenders treat them differently.

Gather proof of income and employment

Lenders will ask for recent pay stubs — usually the last two months — and a W-2 from the past two years. If you are self-employed, you will need tax returns for the past two years and possibly a profit-and-loss statement from your accountant. If your income changed recently (a new job, a promotion, or a side business), have documentation ready to show the change is stable.

You may also need a letter from your employer confirming your job title, salary, and how long you have worked there. Some lenders ask for this automatically; others only if your employment history is short or has gaps. If you are retired and living on Social Security or pension income, bring statements showing that income source.

Collect bank and asset statements

Lenders want to see your savings and checking accounts to confirm you have reserves — money set aside beyond what you need for the refinance. Bring bank statements from the last two months. If you have investment accounts, retirement accounts, or other assets, statements from those help too, though lenders weight them differently depending on how easily you can access the money.

If you are putting money down or paying closing costs out of pocket, the lender will trace where that money came from. Large deposits that appear suddenly can trigger questions; be ready to explain them. If a family member is gifting you money for closing costs, you may need a gift letter stating the money is a gift, not a loan.

Know your home's current value

The lender will order an appraisal, but you should have a rough idea of what your home is worth before you start. Check recent sales of similar homes in your neighborhood using public records or real estate websites. Your county assessor's office also has property values on file, though those are often lower than market value.

Your home's value matters because it determines how much equity you have. If you owe $200,000 and your home is worth $250,000, you have $50,000 in equity. Lenders use this to decide whether to refinance and at what rate. If your home has lost value since you bought it, refinancing may still be possible, but the terms will be different.

Review your credit report before applying

Pull your credit report from all three bureaus — Equifax, Experian, and TransUnion — at annualcreditreport.com, which is free and does not hurt your credit score. Look for errors: accounts you do not recognize, wrong balances, or late payments that were actually on time. Dispute any mistakes with the bureau before you apply to refinance.

You do not need a perfect credit score to refinance, but you should know what yours is. Lenders will pull your credit when you apply, and that inquiry will lower your score slightly — usually by a few points. Multiple inquiries from different lenders within a short window (typically 14 to 45 days, depending on the type of loan) usually count as one inquiry, so shopping around does not hurt you as much as it once did.

Organize your debts and monthly obligations

Make a list of all your debts: credit cards, car loans, student loans, personal loans, and any other monthly payments. Include the balance, monthly payment, and interest rate for each. Lenders calculate your debt-to-income ratio — the percentage of your gross monthly income that goes to debt payments — and this number affects whether you can refinance and at what rate.

If you have high credit card balances or other debts, paying some down before you apply can improve your ratio and your rate. Even paying off one card can make a difference. Do not open new accounts or take on new debt while you are in the refinancing process; lenders pull your credit again before closing, and new debt can change your approval.

Document any recent life changes

If you have had a major change in the past year or two — a job loss, a health crisis, a divorce, or a significant drop in income — have documentation ready. Lenders will see the impact on your finances and may ask about it. A written explanation of what happened and how your situation has stabilized since then can help. If you have recovered from a hardship, proof of that recovery (steady paychecks, paid-off debts, or restored savings) matters.

Similarly, if you have made improvements to your home — a new roof, updated HVAC, or major repairs — photos and receipts can support a higher appraisal. Lenders do not always factor these in, but they can help if your home's value is borderline.

Key Takeaways

• Your current mortgage documents, recent payment history, and proof of income are the foundation of any refinance application.
• Lenders will order an appraisal, but knowing your home's approximate value beforehand helps you understand whether refinancing makes financial sense.
• Your debt-to-income ratio — the percentage of your gross income that goes to monthly debt payments — directly affects your rate and approval odds.
• Checking your credit report before you apply lets you fix errors and gives you a realistic picture of what rate you might receive.
• Avoiding new debt and large unexplained deposits in the weeks before you apply keeps your financial picture stable and your approval on track.

Frequently Asked Questions

Do I need to have perfect credit to refinance?

No. Most lenders will refinance with credit scores in the mid-600s, though your rate will be higher than if your score were 750 or above. If your score is below 620, options narrow, but some lenders still work with borrowers in that range. The better your credit, the better your rate, but refinancing is possible across a range of credit profiles.

What if I cannot find my original mortgage paperwork?

Contact your loan servicer — the company you send payments to — and ask for a loan statement or payoff quote. This document shows your current balance, rate, and remaining term. You can also request a copy of your closing disclosure from your servicer or the lender who originated the loan; they are required to keep these on file.

How much does the appraisal cost, and who pays for it?

Appraisals typically cost between $400 and $600, depending on your home's size and location. You usually pay this upfront when you apply, though some lenders roll it into closing costs. If your appraisal comes in lower than expected and you decide not to refinance, you may lose this fee — ask the lender about their appraisal policy before you pay.

Can I refinance if I have missed payments in the past?

Yes, but the more recent the missed payment, the harder it is. Most lenders want to see at least 12 months of on-time payments after a missed payment before they will refinance. If you missed payments two or three years ago and have been current since, many lenders will work with you, though your rate may be higher than someone with a clean history.

Should I pay off debts before I apply to refinance?

Paying down high-interest debt, especially credit cards, can improve your debt-to-income ratio and may lower your refinance rate. However, do not open new accounts or take on new debt while you are applying. If you are close to approval, making major financial changes can delay or derail the process.