Mortgage Refinance Kansas City

Licensed to work with clients in 30 different states.

When you refinance, you replace your current home loan with a new one. Mortgage refinancing requires you to qualify for the loan, just as you had to meet the lender’s requirements for the original mortgage. You file an application, go through the underwriting process and go to closing, as you did when you initially purchased the home.

The Mortgage Refinancing Process

First, take care of any issues with your credit so that your credit score is as high as possible and you qualify for the lowest interest rates. Have a rough idea of the rates and other terms you desire in your new loan. Remember: These terms should represent an improvement on the terms of your existing loan.

Next, shop around to find a qualified Kansas City lender with the best terms. Don’t just choose your current lender; get at least three or four quotes from competitors before inquiring with your current lender about what it is willing to offer.

Don’t open any new credit during the refinancing process; it could hinder the deal. Before signing the deal, carefully review the new loan terms and all associated fees so that you know what to expect financially when it’s time to make payments.

As you go through this process, keep an eye on the closing costs. Also, watch out for things like prepayment penalties, which can cause problems down the road if you pay off the mortgage early or refinance again.
Kansas City mortgage refinance

Reasons to Refinance a Mortgage

Lowering your monthly payment

When your goal is to pay less every month, you can either refinance into a loan with a lower interest rate or a longer loan term. However, extending the term means that you pay more interest in the long run.

Paying off the loan faster

You can switch to a mortgage with a shorter term and, as a result, pay less interest over the life of the loan. One downside to this is that your monthly payments will probably go up.

Cashing out

If you have significant equity in your Kansas City home, you may be able to cash out a portion of it with a refinance to pay bills, finance a large purchase, or buy out an ex-spouse in a divorce.

Getting rid of FHA mortgage insurance

Whereas private mortgage insurance (PMI) on conventional home loans can be canceled, you can only get rid of FHA mortgage insurance premiums by selling your Kansas City home or refinancing when you have accumulated enough equity (equity can be calculated by estimating the value of your home, then subtracting your mortgage balance from that number).

Switching from an adjustable rate to a fixed rate loan

Interest rates on adjustable rate mortgages (ARMs) can increase over time, while the ones on fixed rate loans stay the same. If you’re looking for more of a sense of financial stability and would prefer making steady payments on your loan, then you might want to consider refinancing.

Consolidating debts

If you have multiple loans, it might make sense to consolidate them into a single loan; it’s easier to keep track of payments that way.

Different Types of Mortgage Refinancing

Rate-and-Term

With this type of loan, the goal is to change the interest rate, loan term or both without making any changes to the amount of the loan. This option is best if you’re trying to save money on your monthly payment or switch your loan from an adjustable rate to a fixed rate.

Cash-Out

As the name suggests, a cash-out refinance involves cashing out a portion of the home’s equity. Doing so results in a higher loan amount, with the difference typically equal to the amount cashed out. While a cash-out refinance can help Kansas City homeowners get the cash they need for certain activities, it typically results in a higher monthly payment and interest rate than a rate-and-term refinance loan.

Cash-In

Much less common than a cash-out refinance is a cash-in refinance. This happens when the homeowner refinances their mortgage loan and brings money to the table to reduce their new mortgage balance. A cash-in refinance may be worth considering if you’re underwater on your mortgage or want to get rid of private mortgage insurance, qualify for a lower interest rate, or keep your mortgage amount below certain limits.

Mortgage Refinancing FAQ’s

What’s the difference between pre-qualified and pre-approved?

Pre-qualification is a determination of the loan amount you’re likely to receive. To obtain pre-qualification, you usually are interviewed by a licensed Kansas City loan officer who determines the pre-qualification amount. On the other hand, to be pre-approved, you must submit an application and verify your credit and financial history. After you receive your pre-approval certificate, you’re in a stronger position to close earlier and negotiate a better price.

What are points?

Points are prepaid interest that you can pay up front. You can pay points to get a lower rate on both fixed rate and adjustable rate mortgages, but the points charged to reduce the rate may vary depending on the type of loan. One point is equal to 1% of the mortgage amount.

If my credit score is low, how can I raise it?

Paying your bills on time, reducing your credit balances, and trying to not apply for credit too often are all ways that you can raise your FICO score.

What’s a rate lock?

A mortgage rate lock is a promise to you from the lender to hold a specific combination of an interest rate and points for an agreed upon time (typically 10, 15, 30, 45 or 60 days) until you can close on your home. Locking in a rate protects you from unforeseen interest rate increases that can occur in the days or weeks leading up to closing, but conversely, if the rates fall, you may not be able to take advantage of the lower rates.

If your credit score is in good shape and you find a qualified Kansas City lender with good terms, refinancing might be a good choice for you. However, depending on your goals and financial situation, it may not always be your best option. It’s important to weigh the benefits of refinancing your Kansas City home against the risks and, at the end of the day, do what will make the most financial sense for you.

Your Kansas City Mortgage Refinancing
Expert: McGowan Mortgages

Contact McGowan Mortgages today at (816) 631-9687.

See What Our Clients Are Saying About Us!

Trena
Trena
18:09 31 Aug 22
Derek is amazing! I've worked with him on a refinance at his previous company, I recommended him to multiple friends who also chose to work with him, and then I reached out to him again for my recent home purchase with his new company. He and his team did an outstanding job dealing with my unique situation, found a way to make it work, and then kept in constant contact with the agents (both buyer's and seller's) to ensure that things stayed on schedule and moved smoothly. They're awesome, and I highly recommend them to anybody in the market for a purchase or refinance!
Kimaada Ellison
Kimaada Ellison
18:35 22 Aug 22
As a first time home buyer with very limited knowledge about this entire process, this company and all of its staff have really made me feel comfortable about asking questions and learning about how everything works. Elijah has fielded many questions from me and each time was able to rationally explain everything to me in layman's terms that helped me understand. I am so pleased to have come across this organization and would recommend them to any potential home buyer without hesitation. Keep up the great work guys.- KE
Sam Kolthay
Sam Kolthay
16:48 15 Aug 22
This is the second time I've worked with Derek on buying a house, and I know I'd use him for a third!Derek and his team work tirelessly to get the loan across the line as quickly as possible and at the best rate.I highly recommend trusting Derek with your loan needs!
nathan denham
nathan denham
20:17 07 Aug 22
Being involved with Real Estate for many years my clients have used many different lenders. There have been good ones and bad ones but McGowan Mortgage is different than the rest and always delivers. I highly recommend you use McGowan Mortgage for your financial lending needs.
Rachel Diebold
Rachel Diebold
00:18 29 Jul 22
Tarek Jebali
Tarek Jebali
02:08 22 Jul 22
Derek is a true professional; knowledgeable, hard worker and he is here when you need him.Thank you again for everything and for hanging in there with me. I highly recommend him for your mortgage needs
Steve Lopez
Steve Lopez
02:06 13 Jul 22
First time buying a home couldn’t have choose anyone better. Super helpful and have a wonderful team that will make sure all your questions get answers. Definitely recommend
Jared Pfeiffer
Jared Pfeiffer
13:39 18 May 22
I have worked with Derek and his team on multiple purchases. His attention to detail, the speed in which he works and his collaboration makes him at the top of his industry in my opinion.Looking forward to continuing to work with him in the future.
Annie
Annie
00:44 02 May 22
artbycins
artbycins
03:04 01 May 22
Eric L
Eric L
14:41 29 Apr 22
Derek is awesome!! His knowledge of the mortgage industry is incredible. Every question I’ve had for him he gives me an easy-to-understand yet in-depth answer. We’re working on a refi for our current home and I’ll definitely reach back out once we’re ready to purchase our next home! Thanks Derek!!
Steve Zebley
Steve Zebley
13:56 29 Apr 22
Derek McGowan is the best!
Elijah Dixon
Elijah Dixon
00:10 29 Apr 22
Derek and his team are extremely knowledgeable. The level of communication and use of technology is second to none ....
Sam Tracy
Sam Tracy
20:02 28 Apr 22
Derek helped my wife and I buy our first house and was so great at walking us through the entire process, making sure we understood everything. He was always available to answer all of our questions and was impressively quick on getting paperwork signed and submitted. Put simply, he made everything easy. So glad we worked with Derek and he will be our first call when we look at moving again!
Collin Joiner
Collin Joiner
18:23 28 Apr 22
Derek is absolutely fantastic! Not only did he make financing my new home completely seemless, but he made himself available practically 24/7. Not like your usual broker that claims they can always be reached and has your best interest at heart, but he is genuine, up front, and when you pick up the phone to call or text him... he actually answers or gets right back with you! I did my initial loan with him, when rates dropped I did my refi with him, I also got my ex to finance through him for her first home. And through each interaction he stayed consistent in his approach and true to the values he promises. If it's Derek or associated with Derek, I promise you can't beat it!! He's the best!
Gabe Buckner
Gabe Buckner
12:28 27 Apr 22
Really smooth process from start to finish! Incredibly resourceful in every aspect. Will use again.
Todd Minear
Todd Minear
12:11 27 Apr 22
Derek is professional, responsive and always friendly. He always delivers. Highley recommended!
Tammy Walker
Tammy Walker
10:28 27 Apr 22
Derek was absolutely great in helping us refinance our mortgage. He walked us through everything and was always ready to answer any questions we had. We would definitely use him again.
Diamon Collins
Diamon Collins
05:47 27 Apr 22
Very knowledgeable and friendly! We were able to take the helpful information given to choose the best option for our home buying needs! Highly recommended!
Kc Thizz-N-Vision Tv
Kc Thizz-N-Vision Tv
05:10 27 Apr 22
james ellis
james ellis
04:29 27 Apr 22
The communication and overall process was awesome. Zero issues and had me ready to close 2 weeks early. Highly recommend.
Markus Marrs
Markus Marrs
04:29 27 Apr 22
Derek and his team made sure to do the best by me and my family!
Kelli Harpe
Kelli Harpe
01:27 24 Apr 22
Derek and his crew have been ultra responsive since day 1. Phone calls are promptly returned and questions answered with confidence. Excellent customer service.
Marria Tran
Marria Tran
23:58 23 Apr 22
Derek and the McGowan Mortgage Team were top-notch from start to finish. Buying a home for the first time was incredibly overwhelming and stressful but Derek and his team educated us through the entire process. They went above and beyond to help us with questions and concerns that were outside of their control, making us feel like we were their #1 priority. Exceptional communication and promptness on our closing date. Derek was very knowledgeable with understanding the market conditions and did everything to make sure we had the best rate possible! We are lifelong customers and would highly recommend to anyone and everyone! ⭐️
Marissa jacobs
Marissa jacobs
22:40 23 Apr 22
Derek has been truly wonderful!
Nate Lickteig
Nate Lickteig
13:14 16 Mar 22
Derek and the team at McGowan Mortgage are incredible. They all were very diligent to walk us through the process from the application up through closing day. They were consistently available to answer questions with multiple avenues to call and text to get quick answers. They were meticulously thorough in showing all of the factors determining our rates and how they were getting us the best available option. The tools that were provided to help calculate our estimated payments were specific to our loan and were fantastic to pin point what the mortgage payments would look like for each of the homes which we considered. We shopped with one other lender and between the rate offers and level of communication it was an absolute no-brainer to work with Derek and the team at McGowan Mortgage.
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