How to Refinance in Arizona

Refinancing your home mortgage in Arizona should be a straightforward transaction. However, the local economy and state of the Arizona housing market at the time of your refinancing could make the process challenging. For example, in December 2010 "The Arizona Republic" reported that Phoenix ranked third in the nation in mortgage delinquencies, as the entire state continued to struggle with a housing crisis. Refinancing your mortgage in Arizona under conditions similar to those could require you to have exceptional credit as lenders tighten lending guidelines. However, in a good economy, refinancing in Arizona should be as easy as refinancing in any other state.

Instructions

1

Determine the value of your home in Arizona by ordering an appraisal from a licensed appraiser or seeking the advice of a licensed Arizona real estate agent. The real estate agent can compare your home with others that have recently sold in your neighborhood. It is possible that your home in Arizona may have lost much of its value because of a housing crisis, making a refinancing impossible. The MSN Money website reported in 2009 that property values had declined sharply in states hard hit by foreclosures. The foreclosure rate in Arizona was twice that of the national average during the height of the housing crisis at the end of 2008, according to the Federal Reserve Bank of San Francisco. Use the information from the appraiser or real estate agent to compare the fair market value of your home with the mortgage balance. MSN Money reports that to qualify for refinancing your mortgage balance should not exceed 70 percent of the value of the home. Some lenders may have stricter requirements.

2

Obtain a free copy of your credit report from AnnualCreditReport.com. The website is managed by major credit bureaus Experian, Equifax and TransUnion, and is the only site endorsed by the Federal Trade Commission to offer free credit reports under the terms of the Fair Credit Reporting Act. Visit the website to view and print your report (see Resources). After receiving your report, follow the included instructions to order your credit score, separately, for a fee.

3

Review your credit report and score with the assistance of a government-certified housing counselor in Arizona. Examples include Genesis Housing Services, in Gilbert; Community Services of Arizona, in Glendale; and Housing Our Communities, in Mesa. The nonprofit housing counselors know all about the current real estate market and refinancing trends in Arizona, and can offer credible refinancing advice based on the market conditions and your credit situation. Find a certified housing counselor in Arizona by checking the website for the U.S. Department of Housing and Urban Development (see Resources).

4

Ask the counselor specifically about avoiding refinancing scams in Arizona. In November 2010, Arizona Attorney General Terry Goddard filed suit against one company that allegedly defrauded more than 140 homeowners through a so-called "sales lease-back" scheme. Goddard reported that some of the homeowners thought they were refinancing their mortgages but were actually signing over their property to a company.

5

Apply for your refinancing at a credible lending institution, such as a bank or credit union. As in any other state, you will have to meet certain qualifications, such as income documentation.