Some More Closing Information (Applies to Refinances Only)
What About Your Existing Homeowner's Insurance Policy?
When you refinance, you are required to have at least 1 - 6 months of insurance coverage remaining on your current homeowner's insurance policy. If you do not, you will be required to pay for a full year's policy prior to closing on your refinance. You can change the effective date of your policy and get a credit from your insurance agent for any months remaining on you current policy.
Three Day Rescission Period
When you close on a refinance, you go to your closing and sign all of your documents. However, your transaction is not complete yet. By law, we must give you three business days to think about your transaction. This is your chance to cancel your refinance. On the 4th business day after you sign your documents, your transaction will be complete.
Closing Day vs. Disbursement Day
Unlike a purchase transaction, anytime you refinance, the funds from your new mortgage do not disburse until after your three-day rescission period. On the fourth business day after you Sign your documents, your current mortgage will be paid off, your escrow account will be set up, you will receive any cash that you are expecting, debts will be paid off, if applicable. This is also the day you start paying interest on your new mortgage.