The benefits of traditional refinancing
Traditional refinancing, often called rate and term refinancing, swaps your current home loan for a new one with better terms, which can offer perks and financial boosts. Let’s explore the top reasons to refinance.
Lower your interest rate
Refinancing your mortgage to a rate that’s lower than the one you have today could save you quite a bit of money over the life of the loan. When mortgage rates drop, it’s worth running the numbers.
Decrease your monthly payment
If you refinance to a longer term, you can reduce your monthly payments. This means a bit more cash in your pocket each month. The catch? You’ll end up paying more over the life of the loan.
Pay off your loan faster
Refinancing to a shorter term loan builds equity faster and ends your mortgage sooner. While it increases monthly payments, you’ll save a chunk on interest in the long run.
Lower your interest rate
Refinancing your mortgage to a rate that’s lower than the one you have today could save you quite a bit of money over the life of the loan. When mortgage rates drop, it’s worth running the numbers.
Decrease your monthly payment
If you refinance to a longer term, you can reduce your monthly payments. This means a bit more cash in your pocket each month. The catch? You’ll end up paying more over the life of the loan.
Pay off your loan faster
Refinancing to a shorter term loan builds equity faster and ends your mortgage sooner. While it increases monthly payments, you’ll save a chunk on interest in the long run.
home buying Compare ways to access your home equity
Home equity is the slice of your home you actually own. It’s what’s left after you subtract your mortgage from the home's market value. Wondering how to tap into this asset? You’ve got options!
Cash-Out Refinancing
Cash-out refinancing allows you to replace your current mortgage with a larger one and receive the difference in cash.
Learn MoreHome Equity Loan
A home equity loan allows you to borrow a lump sum against your home’s equity, which you repay in fixed installments. It’s ideal if you need a specific sum of money for things like home improvements.
Learn MoreHome Equity Line of Credit (HELOC)
A HELOC gives you a credit limit you can borrow against whenever you need to, and you only pay interest on what you use.
Learn More
Cash-Out Refinancing
Cash-out refinancing allows you to replace your current mortgage with a larger one and receive the difference in cash.
Learn MoreHome Equity Loan
A home equity loan allows you to borrow a lump sum against your home’s equity, which you repay in fixed installments. It’s ideal if you need a specific sum of money for things like home improvements.
Learn MoreHome Equity Line of Credit (HELOC)
A HELOC gives you a credit limit you can borrow against whenever you need to, and you only pay interest on what you use.
Learn More
Let's calculate the costs of refinancing a mortgage together!
Cash-Out Refinance Calculator
Convert your home equity into cash.
Learn MoreMortgage Refinance Calculator
Estimate how much you could save by refinancing.
Learn More
When should I refinance my mortgage?
The ideal time to refinance your mortgage depends on your unique situation. Whether you're looking to lower your interest rates or adapt to significant life changes, refinancing could be a good move. Ready to explore your options?
Mortgage refinancing FAQs
Refinancing your mortgage lets you start fresh on your home loan. You take out a new loan that pays off your old one, aiming to snag better loan terms or a lower interest rate. Curious about how this process can work for you? Dive into our detailed guide to refinancing to get all the insights.
Choosing the right refinance option can feel a bit daunting, but it's all about matching your specific needs with the right type of loan. Start by thinking about your current mortgage, your home's value, how much you still owe and whether you're aiming to ditch mortgage insurance. Take a look at the most popular mortgage refinance options to determine which one meets your needs best.
The costs of refinancing a mortgage loan can depend on several factors from the size of the loan to its specific terms and other fees like appraisal, closing costs and application charges. To get a clearer picture of what you might expect to pay, check out our detailed breakdown of refinancing costs.
The time it takes to refinance a mortgage can vary depending on the lender's process, current market conditions and potential delays that may arise. On average, refinancing takes between 30 to 45 days from application to closing.
It depends on your financial situation. The aim of refinancing mortgages is usually to save money on interest or cash out some equity. However, a loan modification involves changing the terms of your existing mortgage with your lender in order to mitigate financial hardship or even help you avoid foreclosure.
No, a second mortgage is an additional loan taken out on a property that has an existing mortgage, while refinancing a mortgage involves replacing an existing mortgage with a new one, often to obtain a better interest rate or loan terms.
You might be able to lower your mortgage payment without refinancing by exploring options such as extending your loan term through a mortgage recast, canceling private mortgage insurance if you qualify, or discussing a loan modification with your lender if you're facing financial difficulties.
Overall, refinancing a mortgage can temporarily impact your credit score. When you apply, the lender will check your credit, which might cause a slight dip. Also, the new loan could shorten your credit history a bit. But don't worry too much—this is usually short-lived. Keep up with your payments and your score should bounce back soon.
When to refinance hinges on your own situation. If you're planning to stay in your home for a while and mortgage refinancing rates today are lower than when you got your original mortgage, it might be a great time to look into refinancing. Just make sure to crunch the numbers and ensure that the savings you could gain will outweigh the costs involved in the process.
