What Should I Do if I Want a New Mortgage Loan Before the Other Is Paid Off?

If you need a new mortgage loan before your current one is paid off, there are a few items to address. 

First, ensure your credit is rock solid. A lender will see you as a risk if your debt-to-income (DTI) ratio is high. Healthy credit scores can prove that you pay back debts, even if you have multiple, large lines of credit.  

Second, ensure you have plenty of liquidity on hand. If you’re buying a new house, the new lender will likely require a down payment. If you have plenty of cash on hand you’ll be able to make this down payment, juggle the two mortgage payments, and make any necessary repairs until you find your footing.

Finally, consult with a real estate agent, lender, and financial professional if you’re unsure. Asking an expert for advice will help you avoid mistakes such as taking on too much debt, running out of cash, or not getting approved for the mortgage.

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