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Published: Jan 22, 2024 29 min read
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  • Low refinance rates, Cashout refinance and Home Equity financing
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600 minimum credit score 

  • Access your home's equity with a Cash-Out Refinance
  • Refinance up to 100% of your primary home’s value
  • FDIC Bank since 1919 with A+ BBB Rating
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Highest in customer satisfaction in the U.S.

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Why Trust Us?

Money has been providing its readers with in-depth product reviews and financial advice for over 50 years. Our mortgage refinance lender reviews are the result of hours of research and analysis of over 20 lenders. We evaluated the variety of loan types offered, average interest rates, customer service ratings and the number of complaints filed against each lender, among other factors. We also relied on rankings and data from expert sources, including the Mortgage Bankers Association, J.D. Power’s Mortgage Origination Satisfaction Study and the National Multistate Licensing System (NMLS).

Refinancing your mortgage is one way to improve your financial position, but for the move to make sense, you need to find the right lender. The best refinance companies will offer competitive interest rates, a smooth application process and a variety of loan options.

Based on our analysis of the loans offered, average interest rates and customer satisfaction rankings, we chose Rocket Mortgage as the best refinance lender overall.

You may, however, want to consider other lender options as well. Shopping around for the best rate and terms is the only way to ensure you find the right loan to fit your needs. Read on to learn why we think these eight companies are the best in the market right now.

Our Top Picks for the Best Mortgage Refinance Companies of 2024

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Best Mortgage Refinance Reviews

Why we chose it: We chose Rocket Mortgage (formerly Quicken Loans) as the best overall mortgage refinance company for its excellent track record in customer satisfaction and web-based customer support. It’s also popular: In 2022, Rocket originated more mortgages than any other company in the United States, according to data from the Home Mortgage Disclosure Act collated by data firm iEmergent.

Pros
  • Rated best mortgage servicer by JD Power
  • Largest mortgage originator in 2022
  • Streamlined online application process with eClosing
  • Features a mortgage refinance rates calculator
Cons
  • No in-person service, but you may reach out to an affiliated broker
HIGHLIGHTS
J.D. Power Rating
750/1000
NMLS Regulatory Actions
8
Min. Credit Score
620 (580 for FHA)
Refi Loan Types
15- and 30-year Conventional, ARM, FHA, VA, Jumbo, home equity loans

Rocket Mortgage (NMLS ID# 3030) has ranked in the top 3 in the J.D. Power U.S Primary Mortgage Origination Satisfaction Study for nine consecutive years. You can complete your application online or by phone with help from one of the company’s home loan experts. In many cases, you can also get in-person assistance from an independent mortgage broker affiliated with Rocket.

Rocket Mortgage’s offerings include Fannie Mae’s RefiNow and Freddie Mac’s Refi Possible, which are refinance options for homeowners with a debt-to-income ratio of up to 65% who currently have a mortgage with one of those government-sponsored enterprises.

Homeowners who qualify for these programs will see a reduction of at least 0.50 percentage points off their interest rate and can apply for a grant of up to $500 to cover appraisal costs. Applicants must have a good payment history, a FICO credit score of 620 or higher and at least 3% equity in a one-unit primary residence to be eligible.

Other refinancing options allow homeowners to shorten their term or access their home equity with a cash-out refi.

See rates on Rocket Mortgage's Secure Website >>

Why we chose it: We chose loanDepot as the best online mortgage refinance company because of its widespread availability across the U.S.

Pros
  • Licensed in all 50 states with over 200 locations in 43 states
  • Streamlined digital platform
Cons
  • Loan rates are not available online
HIGHLIGHTS
J.D. Power Rating
722/1000
NMLS Regulatory Actions
4
Min. Credit Score
620 (580 for FHA)
Refi Loan Types
Conventional, fixed-rate, ARM, VA, FHA, HARP

loanDepot (NMLS# 174457) stands out for its “mello smartloan,” a digital portal that uses artificial intelligence to verify asset and employment details, perform credit checks and begin the home appraisal process. The online application can be completed in a matter of minutes.

Choosing loanDepot for a mortgage refinance comes with another perk: If you’ve refinanced with the company before, its Lifetime Guarantee will waive your lender fees on future refinances. You can also qualify for a half-point fee waiver on closing costs if you refinance an existing loanDepot home equity line of credit (HELOC) into a new HELOC.

loanDepot also services its loans, so you’ll be dealing with the same company for as long as you hold the loan. The website provides educational resources on the refinancing process and has a calculator that will estimate of your new mortgage payment if you decide to refinance.

While the lender’s digital application process is streamlined and fast, loanDepot also has over 200 locations throughout the United States for borrowers who may prefer more personal attention.

See rates on loanDepot's Secure Website >>

Why we chose it: We chose Zillow as the best mortgage refinancing marketplace for its ability to connect homeowners with a variety of licensed lenders throughout the country, and its array of tools that help guide the process.

Pros
  • User-friendly mobile app
  • Wide range of online resources, including a mortgage calculator
  • Easy access to competitive rates, updated daily
  • Most of the application process is performed online
  • Licensed in 49 states and the District of Columbia, not licensed in NY
Cons
  • No program to help homebuyers with bad credit
HIGHLIGHTS
J.D. POWER RATING
Not Rated
NMLS REGULATORY ACTIONS
3
MIN. CREDIT SCORE
620 (Conventional), 620 (FHA), 620 (VA), 700 (Jumbo)
REFI LOAN TYPES
Fixed-rate, ARM, Jumbo, VA, FHA, Conventional Conforming

Zillow Home Loans (NMLS ID#: 10287) is the affiliate company of Zillow, Inc., the real estate listing site, but it also offers access to thousands of lenders across the country, including mortgage bankers and brokers, credit unions and community banks.

Zillow Inc.’s Lender Directory allows you to search for a mortgage provider by city, state/territory or zip code. You can also search for a specific bank or loan officer if you have a recommendation from a friend or family member, read customer reviews and submit an application.

Zillow also has a mortgage refinance rate comparison tool, which lets you compare average interest rates for different types of loans (including conforming, government-backed and jumbo loans) as well as different term lengths. Updated daily, the tool can give you an idea of what mortgage interest rate you can expect to qualify for and compare it the market average.

As with any marketplace, once you contact a lender, you’ll be dealing with that company directly and Zillow will no longer be involved in the process.

See rates on Zillow's Secure Website >>

Why we chose it: We chose Better as the best mortgage refinance company for fast closing times. Homeowners can get a rate quote and a letter of preapproval within 24 hours — and it comes with a price match guarantee.

Pros
  • Fast online process, with competitor price-match program
  • No origination, application or underwriting fees
  • Smart tech automatically looks for and applies eligible discounts
Cons
  • Online-only, no brick and mortar branches
  • Limited refinance loan type options
HIGHLIGHTS
J.D. Power Rating
692/1000
NMLS Regulatory Actions
6
Min. Credit Score
620
Refi Loan Types
Conventional, Fixed-rate, ARM, FHA, Jumbo

Better Mortgage (NMLS ID# 330511) is an online lender with a refinance process that’s fast and straightforward. It also offers some of the lowest closing costs in the industry.

Better says it can afford to forego some of the fees charged by traditional brick-and-mortar lenders — such as application, underwriting and origination fees — because they operate fully online. Additionally, it offers a price guarantee if another lender offers homeowners a more competitive price on one of the refinance products Better offers.

Better customers get direct access to a dedicated loan officer, who can help them navigate the application process by phone. Or they can opt to upload and sign all their documents through the lender’s website instead. The entire process, from application to pre-approval, can be done in as little as one day.

Customers who recently purchased a home with Better can qualify for up to $3,500 in lender credits toward closing costs if they refinance within three years of obtaining their original loan. Borrowers can use Better’s mortgage payment and amortization calculators to estimate their new monthly payments and how much interest they can save over time with a refi.

See rates on Better's Secure Website >>

Why we chose it: We chose Navy Federal as the best mortgage refinance credit union because of its fast online pre-approval process, choice of loan terms and benefits for borrowers who are also selling.

Pros
  • Online pre-approval application
  • Doesn't require private mortgage insurance (PMI)
Cons
  • Membership is limited to veterans, active-duty military, and their families
  • No FHA, USDA loans, construction loans, or reverse mortgages
HIGHLIGHTS
J.D. Power Rating
760/1000
NMLS Regulatory Actions
2
Min. Credit Score
N/A
Refi Loan Types
Fixed-rate Conventional, Cash-out, VA, VA Streamline, ARM, Jumbo

Navy Federal (NLMS# 399807) has mortgage refinancing options for its members, ranging from 10- to 30-year loan terms for their VA Streamline (IRRL) and Homebuyers Choice.

The lender also offers the Military Choice loan for those who have exhausted their VA loan option. In addition to VA loans, Navy Federal can refinance FHA and conventional loans.

Realty Plus and Navy Federal Title Services are tools that facilitate the mortgage refinance process for homebuyers looking to refinance or sell and buy new property. Realty Plus connects you with an agent coordinator to assist with your mortgage application, and you can get between $400 and $9,000 cashback.

Navy Federal also offers HomeSquad, an option for potential borrowers to get a faster preapproval for a purchase or refinance loan. Borrowers can track their loan status 24/7 (online or through a mobile app), upload documents easily, request forbearance assistance and a number of other account activities.

See rates on Navy Federal's Secure Website >>

Why we chose it: We chose Ally Financial as the best mortgage refinance company for jumbo loans due to its higher-than-average lending cap and lack of lender fees.

Pros
  • Online application, document uploads, and electronic signature options
  • No lender fees
  • Quotes don't impact your credit score
Cons
  • You may be required to pay PMI if your down payment is less than 20%
HIGHLIGHTS
J.D. Power Rating
731/1000
NMLS Regulatory Actions
2
Min. Credit Score
700 for Jumbo
Refi Loan Types
Fixed-rate, ARM, Jumbo, Cash-out

Ally Financial (NLMS# 181005) stands out for its jumbo loan offerings of up to $4 million and its lack of lender fees. You won’t be charged any application, origination, loan processing or underwriting fees.

Borrowers must pay a down payment of at least 20% for jumbo loans and provide evidence that they can cover expenses for a certain number of months. Unlike other lenders, Ally accepts restricted stock units as reserve capital.

Ally offers other types of refinance loans, including conventional fixed and adjustable rate mortgages, rate and term loans and cash-out refis. Ally doesn’t charge any lender fees, and says it can close on loans up to 10 days faster than its competitors.

New customers can apply, submit documents and sign paperwork online. Borrowers can also find rates and a refinance mortgage calculator, along with other information regarding refinancing and jumbo loans, on the Ally website.

See rates on Ally Financial's Secure Website >>

Why we chose it: We chose Nationwide as the best mortgage refinance company for custom loans because of the variety of products and flexible lending options and its cash back perk.

Pros
  • Options for self-employed and low credit buyers
  • Customizable terms
  • $0 lender fee offer
  • Free consultations
Cons
  • Only operates in CA, CO, TX, ID, WA, OK, MT and ND
HIGHLIGHTS
J.D. POWER RATING
Not Rated
NMLS REGULATORY ACTIONS
None
Min. Credit Score
N/A
Refi Loan Types
Conventional, VA, FHA, Jumbo

Nationwide offers mortgage refinance loans in partnership with AXOS Bank (NMLS # 524995). The company provides a full gamut of loan options, including rate and term and cash-out refis, all of which can be customized to meet the borrower's needs.

Borrowers can also get up to 3% annualized cash back on mortgage payments made from Axos’ Total Loan Rewards Checking Account, which can add up to a tidy sum. Depending on the loan amount, and contingent on opening an Axos Bank Checking Account, the bank will either reduce or eliminate its lender fees.

The application process can be completed online or by phone with one of Axos’ lending officers.

Borrowers can get an instant rate quote online by providing basic information like loan amount, credit score and the property’s location. Axos also offers a rate watch option to alert when mortgage rates reach your desired level.

See rates on Nationwide's Secure Website >>

Why we chose it: We chose Bank of America as the best mortgage refinance company for member discounts. Its Preferred Rewards program offers significant price reductions on purchase and refinance closing costs.

Pros
  • Exclusive membership discounts available on both purchase and refinance closing costs
  • Physical branch locations available nationwide
  • Considers alternative credit data such as utility bills and rental payment history
Cons
  • No renovation loans
HIGHLIGHTS
J.D. Power Rating
731/1000
NMLS Regulatory Actions
10
Min. Credit Score
N/A
Refi Loan Types
Fixed-rate, ARM, FHA, VA, Cash-out, Home Equity

Bank of America (NMLS# 399802) members can benefit from its Preferred Rewards program by qualifying for a closing cost reduction of up to $600 from their purchase or refinance origination fees.

The program works in tiers ranging from Gold to Platinum Honors, with discount levels based on members’ banking and Merrill investment account balances. Some benefits of the program require enrollment in PayPlan, an automatic payment service linked to a Bank of America deposit account.

Like many other lenders, Bank of America provides a range of digital services to borrowers: customers can apply for a refinance loan directly online or an appointment can be scheduled with a loan officer at any of Bank of America’s branches.

Other resources include an online refinance calculator and home value estimator designed to give borrowers an idea of how much they could save with a refi.

See rates on Bank of America's Secure Website >>

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Take the first step toward refinancing your mortgage today by seeking out the priceless data you'll need to get through the process from Rocket Mortgage (NMLS #3030). To find out more, click below.
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Other mortgage refinance companies we considered

Through our research on the mortgage lending industry, we found that many of the biggest lenders don’t necessarily offer the best refinance products. (Though they might excel in other areas.)

Chase Review

Why we didn’t choose it: We didn’t choose Chase (NMLS# 399798) because of the high number of regulatory actions and customer complaints filed with the Consumer Financial Protection Bureau within the past five years.

Pros
  • Large variety of loans: ARMs, 10-, 15-, 20-, 25- and 30-year mortgages, FHA and VA loans and DreamMaker Mortgage Program
  • Competitive mortgage interest rates
  • Online Refinance Learning Center with calculators for loan estimates, interest rates and terms
Cons
  • Several regulatory actions with the CFPB within the last five years (although none filed within the last four years)
  • High number of customer complaints with the CFPB
HIGHLIGHTS
J.D. Power Rating
736/1000
NMLS Regulatory Actions
9
Min. Credit Score
620
Refi Loan Types
DreamMaker®, Fixed-rate, FHA, VA, Jumbo, ARM

See rates on Chase's Secure Website >>

PNC Bank Review

Why we didn’t choose it: We didn’t choose PNC Bank (NMLS# 446303) because the application process cannot be fully completed online.

Pros
  • Has current mortgage rates and helpful calculators on its site
  • Home insight planner and application tracker
  • Considers non-traditional credit history
  • Online mortgage preapproval
Cons
  • The process can't be fully completed online
  • No branches in AK, AZ, AR, CA, CT, HI, ID, IA, LA, ME, MN, MS, MT, NE, NV, NH, NM, ND, OK, RI, SD, UT, VT, WA or WY
HIGHLIGHTS
J.D. Power Rating
732/1000
NMLS Regulatory Actions
2
Min. Credit Score
620
Refi Loan Types
Fixed, ARM, Cash-out, Jumbo, FHA, VA, USDA

See rates on PNC Bank's Secure Website >>

SunTrust Review (now Truist)

Why we didn’t choose it: We didn’t choose SunTrust (NMLS# 399803) because there is no transparent information on fees and closing costs on the website.

Pros
  • Online mortgage application and tracking software
  • Comprehensive educational resources
Cons
  • Customized rates are only available with an application
  • Branches only in AL, AZ, DC, FL, GA, MD, NC, SC, TN and VA
  • Fees not available online
HIGHLIGHTS
J.D. Power Rating
718/1000
NMLS Regulatory Actions
0
Min. Credit Score
620
Refi Loan Types
Cash-out, VA IRRRL

See rates on SunTrust's Secure Website >>

Alliant Credit Union Review

Why we didn’t choose it: We didn’t choose Alliant Credit Union (NMLS# 197185) because of the limited number of refinancing options available.

Pros
  • Rate watch sends a notification when rates have hit your target
  • Complete the application process online
Cons
  • No government-backed loans
  • Doesn't disclose loan fees
  • No in-person banking
  • Must be a member to qualify
HIGHLIGHTS
J.D. Power Rating
Not Rated
NMLS Regulatory Actions
1
Min. Credit Score
620
Refi Loan Types
Fixed, ARM, Jumbo

See rates on Alliant's Secure Website >>

Guild Mortgage Review

Why we didn’t choose it: We didn’t choose Guild Mortgage (NMLS# 3274) because its loan products are not available in all states.

Pros
  • Online mortgage application, e-signatures and digital loan process tracking
  • Direct lender, services its own loans
  • Closing cost and total payment calculator
  • Highest rated by JD Power's US Primary Mortgage Originator Satisfaction Study
Cons
  • Not available in NY or NJ
  • Rates aren't available online unless you apply
  • Does not disclose fees
  • Branches only in 33 states
HIGHLIGHTS
J.D. Power Rating
731/1000
NMLS Regulatory Actions
3
Min. Credit Score
640
Refi Loan Types
Fixed, ARM, Cash-out, FHA, VA, USDA, Jumbo, Reverse

See rates on Guild Mortgage's Secure Website >>

U.S. Bank Review

Why we didn’t choose it: We didn’t choose U.S. Bank (NMLS# 402761) because of its limited refinancing options.

Pros
  • Variety of refinance loan offerings
  • Rewards homeowners with an existing first mortgage with U.S. Bank
  • Great online tools, with a fully digital application and a proprietary app
  • Provides general mortgage rates, with the option to see results by state
  • Online prequalification
Cons
  • Customer satisfaction rating was below average
  • Mortgage rates on the website assume a higher-than-average credit score
HIGHLIGHTS
J.D. Power Rating
685/1000
NMLS Regulatory Actions
2
Min. Credit Score
620
Refi Loan Types
Conventional, FHA, VA, USDA, Cash-out, IRRL

See rates on U.S. Bank's Secure Website >>

AmeriSave Mortgage Review

Why we didn’t choose it: We didn’t choose AmeriSave Mortgage (NMLS# 1168) because of the high number of regulatory actions lodged against the company.

Pros
  • Wide variety of loan options
  • Closing time average of 25 days
Cons
  • High number of regulatory actions with the NMLS
  • Doesn't disclose origination fees or closing costs
  • Not available in New York
HIGHLIGHTS
J.D. Power Rating
674/1000
NMLS Regulatory Actions
14
Min. Credit Score
620
Refi Loan Types
Rate and Term, Cash-out, FHA, USDA, VA

See rates on AmeriSave's Secure Website >>

Veterans United Home Loans Review

Why we didn’t choose it: We didn’t choose Veterans United (NMLS# 1907) because it offers limited refinancing options.

Pros
  • Free credit counseling
  • Representatives available 24/7
Cons
  • Only has physical branches in 18 states
  • Won't refinance FHA or USDA loans
  • Doesn't disclose closing costs or fees
HIGHLIGHTS
J.D. Power Rating
768/1000
NMLS Regulatory Actions
3
Min. Credit Score
620
Refi Loan Types
Fixed, ARM, Jumbo, VA IRRRL, Cash-out

See rates on Veterans United's Secure Website >>

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A higher credit score could lead to a lower refinance interest rate
Credit Repair companies can help you get back on track to increase your score before you apply to refinance your mortgage.
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Mortgage Refinance Guide

If you’re a first-time homebuyer, you’re probably anxious to put the mortgage application process behind you for good. But if you bought at a high interest rate, knowing you have the option of refinancing into a lower rate in the future — and how to go about doing that — can be useful.

You can also refinance your mortgage to take advantage of the increased equity you’ve built up in your home. The proceeds of the new loan can be used to pay off high-interest debt like student loans or to finance home improvement projects.

When you refinance, you replace your current loan with a new mortgage. Our mortgage refinance guide is designed to help people refinancing their home loans for the first time make an informed decision. Read on to learn about different types of mortgage products, the benefits of refinancing a mortgage and what documents financial institutions require for a complete application.

Types of mortgage refinance

By understanding the different loan types, you can zero in on the best mortgage refinance lenders and products for your needs.

Rate-and-term refinance

A rate-and-term refinance allows you to take advantage of low rates. You take out a new loan with the same loan balance as your existing mortgage. Ideally, you’ll get a low interest rate, a shorter repayment term or both. Rate-and-term is the most common type of refi. An example of a rate and term refi is switching from an adjustable-rate mortgage to a fixed-rate mortgage.

What to know:

  • You can use this type of refi to switch from an adjustable-rate to a fixed-rate mortgage
  • Also known as a “no-cash-out” refinance

What to watch out for:

  • You’ll have get an appraisal and pay closing costs again

Zero-closing-cost refinance

Some lenders offer “no-closing-cost” or “zero-closing-cost” refinance loans to qualifying applicants.

What to know:

  • You’ll still pay closing costs (and any interest that accrues), but they’ll be rolled into the mortgage loan and not an upfront cost

What to watch out for:

  • Because closing costs are rolled into the loan amount, monthly payments are higher than a rate-and-term refinance

Cash-out refinancing

One of the benefits of homeownership is the long-term increase in home values. A cash-out refinance converts a portion of the home equity you’ve accumulated into cash, similar to a home equity loan or home equity line of credit (HELOC). A cash-out refi replaces your existing mortgage with a new loan at a higher balance.

What to know:

  • You can take advantage of an increase in your home’s value with a tax-free cash advance paid to you at closing
  • These funds are often used to make home improvements

What to watch out for:

  • You could end up with a higher interest rate and monthly payment
  • Make sure you borrow an amount that’s feasible to pay off

Cash-in refinance

If you have an underwater mortgage, a cash-in refinance allows borrowers to lower their mortgage principal during a refinance negotiation. With this type of loan, the borrower makes a lump sum payment on their mortgage, lowering the principal balance on their new loan.

What to know:

  • This option could improve the chances of an underwater mortgage qualifying for a refinance
  • If you pay down enough of the principal to increase your equity above 20%, it will eliminate your monthly private mortgage insurance (PMI) payments
  • Most lenders require a loan-to-value ration of (LTV) of at least 80%

What to watch out for:

  • Your funds will be tied to your home, so you won’t be able to use them to pay off other debt, cover emergency expenses or invest

Streamline refinance

A streamline refinance allows borrowers who meet the qualification requirements to refinance existing government-backed loans, such as an FHA loan, USDA loan or VA loan, with limited documentation or underwriting.

What to know:

  • These loans generally don’t require appraisals and may or may not require employment and income verification
  • You need to show a history of on-time monthly mortgage payments

What to watch out for:

  • Government-backed loans have specific qualification requirements for borrowers

Low-income enterprise-backed mortgage refinance

In summer 2021, Fannie Mae and Freddie Mac, under the auspices of the Federal Housing Finance Agency (FHFA), implemented new refinance options for low-income borrowers. Eligible borrowers can now refinance their mortgage at a reduced interest rate and lower monthly payments.

The Federal Goverment has several other programs for borrowers with financial difficulties, including Hope for Homeowners (HFH) and the Home Affordable Refinancing Program (HARP).

The Federal Goverment has several other programs for borrowers with financial difficulties, including the Home Affordable Refinancing Program (HARP).

What to know:

  • According to the Federal Housing Finance Agency (FHFA), borrowers may be able to save an estimated $100 to $250 per month

What to watch out for:

  • This option is not available for cash-out refinancing loans
  • You need to have lived in the home for at least one year before doing this kind of refi
  • Only applies to single-family homes.

To meet eligibility requirements, borrowers must:

  • Have a mortgage backed by Fannie Mae or Freddie Mac (the Enterprises) for the house they live in
  • Have an income at or below 80% of their residential area’s median income
  • Have no missed payments in the past six months and no more than missed payment in the past 12 months
  • Have a debt-to-income ratio below 65% or a FICO credit score of at least 620
  • Have a mortgage LTV ratio lower than 97%

How does refinancing work?

Refinancing a mortgage works by replacing your existing home loan with a new one. That means your interest rate, monthly payment and loan term will all change.

Say you obtained a $300,000 mortgage at 6% interest, with a monthly payment of $1,799. After 14 years, you have a remaining balance of $223,000 and decide to refinance into a new 30-year mortgage at 5% interest. Your new monthly payment will be $1,197, and your new payback time is 30 years.

Many homeowners are attracted to refinancing because of the possibility of finding lower interest rates, but there are other reasons for taking out a new home loan — like using home equity to pay off higher-interest debt and shortening the term of the loan.

If, for example, you have an outstanding balance of $247,000 on your 30-year mortgage after seven years at 6% interest, your current monthly payment would be about $1,499. You can refinance into a 15-year fixed-rate loan at 5%, which would bring up your monthly payment to $1,949, but you’ll pay off your home in a total of 22 years instead of 30 (and save a lot of money on interest in the process).

How soon can you refinance a mortgage?

How soon you can refinance your mortgage will depend, in part, on the requirements outlined by your lender — like having a good credit score and enough money in the bank to cover the costs of refinancing.

The type of loan you have will also affect your refi timeline. In the case of conventional loans, you may be able to refinance immediately. Some lenders may require a ‘seasoning’ period, where you have to make a minimum number of monthly payments before being eligible to refinance, which you may be able to circumvent by choosing a different lender.

For FHA loans, you’ll need to have made at least six monthly payments before you can do a rate and term refinance. VA loans also require at least six months of payments, while USDA loans require 12 months of payments.

For a cash-out refinance, you’ll need to have a record of between six and 12 months of payments before you can refinance, depending on the type of loan and the lender. If you’re thinking about refinancing your loan, check with your lender to see what requirements they may have.

Should you refinance your mortgage?

If you’re on the fence about going through with a mortgage refinance, here’s some info on the pros and cons of refinancing, what the money can be used for, and the documentation you’ll need to provide to complete an application.

Under the right circumstances, refinancing can help:

  • Secure a lower interest rate on your mortgage
  • Lower your monthly payment
  • Shorten your loan term
  • Pay off higher-interest debt like credit cards
  • Improve your personal finances

Should I refinance with my current lender?

Before selecting a refinance mortgage lender:

  • Shop around and request loan estimates from multiple lenders

What do you need to refinance your mortgage?

There are three primary factors lenders consider when reviewing mortgage refinance applications: credit score, debt-to-income ratio and loan-to-value ratio (LTV).

  • A low debt-to-income (DTI) ratio: You need a DTI of up to 43% for conventional loans or less than 50% for an FHA mortgage refinance, according to the Consumer Financial Protection Bureau (CFPB). Use our DTI ratio calculator to figure out where you stand.
  • A healthy FICO credit score: Most mortgage refinance lenders require a minimum credit score requirement of 620, but you’ll get the best rates for a score that’s 740 or higher.
  • A Loan-to-value ratio (LTV) of 80% or less: LTV is the amount of the loan you want to take out divided by the appraised value of your home.

You will also have to submit additional paperwork related to your income and the property you are refinancing.

Documentation required to apply for a mortgage refinance:

☑ A copy of your government-issued ID or Social Security card

☑ Proof of income for the last 30 days

☑ W-2s for the past 2 years

☑ Federal tax returns (personal and business) for at least the last 2-3 years

☑ Written explanation if employed less than two years or if there’s a gap or change in employment

☑ Address of property to be refinanced and purchase contract

☑ Homeowners' insurance information such as the agent’s name and contact information

☑ Bank statements and statements of assets

☑ Bankruptcy/ discharge papers (if applicable)

When is refinancing your mortgage not the best idea?

Just because you can refinance doesn’t mean you should.

For starters, if your new interest rate isn’t at least 0.5 to 0.75 percentage points lower than your previous one, most experts argue it’s not worth it.

Refinancing also means new closing costs and other potential fees. If you won’t recoup those costs, it doesn’t make sense to refinance — even if you’re making a lower monthly payment. You should also reconsider a mortgage refinance if:

  • Your refi terms won’t save you much in interest
  • Your credit score has taken a dive since your original mortgage
  • Your new minimum monthly payment will be out of your budget
  • You have plans to move out in the near future
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Latest News on Mortgage Refinance

Homeowners considering a mortgage refinance are getting a break this year.

After flirting with 8% last October, mortgage rates have fallen by more than one percentage point. The recent decline has led to a small revival in refinancing activity as homeowners trade in their higher rates. Compared to the refi boom of the pandemic years, however, market conditions are not the best for many owners who are locked in at a much lower rate.

These less than ideal market conditions are likely to continue improving this year. According to expert predictions, 2024 could be the turning point for mortgage rates, which should extend their recent downward trend as economic conditions improve.

Lower rates also make it more attractive for homeowners who need some extra cash to access the equity in their home through a cash-out refinance, a home equity loan or a home equity line of credit (HELOC).

As with any type of loan, be sure to consider the pros and cons of a refinance before making a decision. If you decide to go ahead, these steps can help you get started:

  1. Define your refinancing goal (e.g. lower your rate, shorten your term, etc.)
  2. Check your home equity
  3. Check your credit score and credit report
  4. Calculate whether refinance costs will be worth it
  5. Get your W2, 1099 forms and other documents ready
  6. Shop for a lender
  7. Lock in your rate

Best Mortgage Refinance FAQs

What is refinancing?

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When you refinance a mortgage, you replace your current loan with a new one with a different term length, interest rate or amount borrowed. Refinancing can help you save money on your mortgage by negotiating a lower interest rate or reducing the number of years you need to pay.

How often can you refinance your home?

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There is no limit to how many times you can refinance your mortgage. However, the closing costs associated with refinancing can be expensive. Just because you can always refinance your home doesn't mean you should do so. Make sure to calculate your breakeven point.

How much does it cost to refinance a mortgage?

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Closing cost to refinance a mortgage can cost around 2% to 6% of your loan amount. These costs include fees for the loan application, loan origination, home appraisal, and more. With a no-closing-cost refinance loan, these fees get rolled into the loan balance or interest rate.

Should I refinance my mortgage?

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You should refinance your mortgage if you can lower your monthly payments, shorten your loan term or negotiate some other type of tangible benefit. A refinance could make sense if you can lower your interest rate by at least 0.50 percentage points. Before opting for a refi, make sure the new terms and payments won't put you in a financial bind.

Can I refinance my home with bad credit?

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You can refinance your home even if you have bad credit, but it won't be easy. You will likely be offered a higher interest rate than someone with a better credit history. However, if you've managed to improve your credit score or accumulate a large amount of savings that can be used to reduce the size of the loan, the positives could outweigh the negatives.

When to refinance a mortgage?

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The best time to refinance a mortgage is when interest rates are lower than when you locked in your rate and closed on your current mortgage. Refinancing when rates are lower will allow you to reduce your monthly payments. You may also refinance to a shorter term and pay more each month but save on interest over the life of the loan.

Who is the best mortgage refinance lender?

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We chose Rocket Mortgage as the best overall mortgage refinance lender because of its consistently high customer satisfaction ratings — including being in the top three best mortgage servicers by J.D. Power for nine years running — as well as its web support and online application process.

How We Chose the Best Mortgage Refinance Companies

Our methodology considered:

  • Lenders that provide a quality customer experience with online tools, pre-approvals, discounts or exclusive refinance programs
  • Lender size, reputation and number of complaints.
  • Consumer feedback and expert input

Summary of Money’s Best Mortgage Refinance Companies of 2024