Should You Refinance Your Mortgage?
See how refinancing at today's rates could lower your monthly payment and save on total interest.
Refinance Savings Example
This is an illustrative example. Your actual savings depend on your specific loan terms, rate, and closing costs.
Types of Refinancing
Rate-and-Term Refinance
Lower your rate, change your term, or both. Most common type.
Cash-Out Refinance
Borrow more than you owe and take the difference in cash. Higher rates.
Streamline Refinance
Simplified process for FHA (FHA Streamline) and VA (IRRRL) borrowers.
When NOT to Refinance
- You plan to move within 2-3 years
- The rate improvement is less than 0.5%
- You are far into your current loan term
- Your credit score has dropped significantly
- You want cash-out to pay off revolving debt you will re-accumulate
Frequently Asked Questions
When does it make sense to refinance?
Generally when you can reduce your rate by 0.5-0.75% or more, AND you plan to keep the loan long enough to recoup closing costs (2-5% of loan amount). Calculate the break-even: closing costs divided by monthly savings = months to recoup.
How much does refinancing cost?
Typical refinance closing costs are 2-5% of the loan amount ($7,000-$17,500 on a $350,000 loan). Costs include appraisal ($400-600), origination fee (0.5-1%), title insurance, and various fees.
Can I refinance with bad credit?
Yes, FHA Streamline refinances do not require a credit check for current FHA borrowers. For conventional refinances, most lenders require 620+. Better credit scores get significantly better rates.