The Best Mortgage Refinance Companies

Hello, my friend, hello again; today we come together to talk about The Best Mortgage Refinance Companies and hope the blog can help you.

Homeowners may be able to save money on—or reduce the length of—their mortgage by refinancing. The best mortgage refinance companies can help borrowers find the right terms to best meet their financial circumstances.

Mortgages are long-term commitments, but that doesn’t mean that homeowners are completely locked into the terms of their original loan agreement. Borrowers have the option to refinance their mortgage—either with their original lender or with a different mortgage company—to take advantage of different loan terms. Refinancing a mortgage essentially replaces the original loan with a new one that has different interest rate or loan length, or is even a different mortgage type. Although there’s a cost to refinancing a mortgage, the long-term savings from a reduced interest rate or fewer monthly payments could be worth the expense for many homeowners.

Lenders can offer a wide variety of loan terms, whether a borrower is looking to refinance or take out a loan on a new house, so it’s worth checking out what options are available and shopping around for the best possible mortgage rates. The best mortgage refinance companies have a lot to offer homeowners, but finding the right fit will depend on a borrower’s specific circumstances.

1. BEST OVERALL: PNC
2. RUNNER-UP: Caliber Home Loans
3. BEST FOR LOW FEES: Better
4. BEST ONLINE EXPERIENCE: Rocket Mortgage
5. BEST APPLICATION PROCESS: Guaranteed Rate
6. BEST FOR VA LOANS: Veterans United
7. ALSO CONSIDER: North American Savings Bank

What to Consider When Choosing One of the Best Mortgage Refinance Companies

Homeowners may approach a refinance with a particular goal in mind—lowering their monthly payment, for example—but it’s important to consider the full impact that a refinance will have on their mortgage. With that in mind, there are several factors that borrowers may want to weigh when deciding on the best mortgage refinance company for their needs.

Eligibility Requirements

Qualifying for the best loan terms—or a home loan at all—requires homeowners to meet certain eligibility requirements. This criteria may include credit scores, debt-to-income (DTI) ratios, income streams, and other factors related to a borrower’s personal finances. When assessing borrowers’ qualifications for a refinance, lenders largely want to gauge how likely they are to repay their mortgage with the new loan terms. Homeowners who present less risk of nonpayment or default are more likely to receive favorable terms such as a lower interest rate or annual percentage rate (APR).

Even so, eligibility standards can vary from lender to lender, and borrowers may qualify for a better rate or a longer loan term with some mortgage companies but not others. It may be worth homeowners checking rates and terms with a few different refinance mortgage brokers and lenders to find the best rate and terms.

Loan Types

Homeowners may want to switch loan types at some point during the life of their mortgage. For instance, a borrower who originally selected an adjustable rate mortgage (ARM) for the relatively low initial interest rate may prefer the consistency of a fixed-rate mortgage once the ARM’s adjustable period begins. In addition, first-time home buyers may find the more lenient eligibility requirements of an FHA loan appealing, but they may want to refinance to a different loan type to remove their mortgage insurance premium after they have built additional home equity.

When looking over the best mortgage refinance companies, borrowers will want to check which lenders offer the specific type of loan they’re looking for—that’s particularly true for anyone interested in more specialized refinancing options such as a cash-out refinance.

Loan Terms

Mortgage companies typically offer a selection of different loan terms for borrowers to choose from for each of their loan products—fixed-rate mortgages, for instance, are typically available as 15-year or 30-year loans, with some lenders providing even more loan terms to consider. Such variety allows borrowers to select a loan term that balances affordable monthly payments with a manageable repayment schedule. In fact, adjusting the length of a mortgage is one of the most common reasons for homeowners to refinance.

It’s a good idea for borrowers to keep in mind that some loan terms may be harder to qualify for than others. When mortgage rates are high, for instance, borrowers may not be eligible for longer loan terms like 30-year fixed-rate conventional mortgages. A lender’s mortgage refinance calculator may provide some insight into what loan terms are available given a borrower’s particular financial circumstances. Getting prequalified for a refinance may provide a more precise assessment, however, and this can be very useful when comparing rates and loan options.

Mortgage Rate

The mortgage rate on a home loan determines how much interest the borrower will pay over the entire life of the loan. That, in turn, impacts the size of a borrower’s monthly mortgage payment as well as the total cost of financing. Many people refinance their mortgage with the goal to lower their interest payment and bring those expenses down, but that option may not always be available. Mortgage rates are dependent on a number of economic factors, such as security bond trading trends, which borrowers will have no way to influence. However, a homeowner’s own financial situation will also affect the interest rate offered by a lender, including their credit history and how much equity they already have in their home.

Mortgage rates can also vary across lenders, so homeowners may qualify for a lower interest rate with one mortgage company compared to another. Shopping around for the best rate may require multiple credit checks, but it could be worth any short-term impact on a borrower’s credit score to find the lowest mortgage rate available. Homeowners may be able to narrow down their search by consulting the best mortgage refinance companies reviews to see which lenders stand out from the competition.

Annual Percentage Rate

The annual percentage rate—or APR—is a more precise indicator of the total cost of a home loan compared with the mortgage rate. Mortgage rates only account for the interest that will be owed on the loan, but the APR factors in other expenses that a borrower will pay over the life of the loan. Those expenses could include closing costs such as origination, recording, or appraisal fees. The APR also accounts for private mortgage insurance attached to the home loan, which will raise a homeowner’s monthly payment.

Homeowners who want a more accurate idea of the total cost to refinance will want to look at the mortgage’s APR, especially if they would pay additional fees with their new loan. An FHA loan may offer a lower interest rate than a conventional fixed-rate mortgage with the same loan terms, for instance, but its APR could be higher due to the mortgage insurance that can never be removed. Because fees and other costs can vary from lender to lender, APR is a good way to compare the affordability of each mortgage company’s offerings.

Average Closing Costs

Refinancing a mortgage comes at a cost. In addition to potential application and appraisal fees, borrowers will likely be required to pay closing costs before their refinance can be finalized. Closing costs can vary quite a bit across lenders, as mortgage companies may charge different origination fees, title search fees, registration fees, and other expenses due at closing. In some cases, borrowers may be able to finance their closing costs, building them into their monthly payments so they repay any additional lender fees throughout the life of the new loan. If homeowners are not able to finance their closing costs, however, then this could be a large out-of-pocket expense that will be due when the new loan is originated and may impact their choice of mortgage refinance company.

Prequalification Process

Preapproval isn’t an entirely necessary step in the refinance process because, without a home purchase transaction, there’s little incentive for borrowers to obtain an approval letter. Prequalification may be another matter, though. A mortgage prequalification can give homeowners a sense of what loan terms they might receive with a refinance. As such, getting prequalified can be very helpful when checking loan eligibility and comparing rates and loan terms offered by different mortgage companies.

The best mortgage lenders may approach prequalification from different angles, potentially allowing borrowers to apply for prequalification online, over the phone, or directly through a loan officer. A more convenient prequalification process may make it easier to shop around for loan terms and get a sense of what a borrower may qualify for when refinancing a mortgage. As such, some borrowers may want to seek out a lender that offers online prequalification and can quickly respond to a submission with expected loan terms.

Application Process

Although borrowers looking to refinance their mortgage may not be under the same time crunch as someone looking to buy a new house, they’ll likely still want a fairly speedy application process. Short application and approval timelines often reflect an experienced and effective underwriting team that is capable of quickly reviewing borrower information and confirming financial details. This can limit the amount of back and forth that borrowers need to go through with their loan officers during the application process. Borrowers may also be able to avoid headaches like resubmitting bank statements, tax returns, and other financial documents if the original records were improperly documented or uploaded. Many lenders support an entirely online application workflow, but some homeowners may feel more comfortable sitting down with a loan officer and talking through the best refinance options before submitting a refinance application.

Mortgage Points

When taking out a new mortgage, borrowers have an opportunity to lower their interest rate by purchasing mortgage points. Each mortgage point purchased will typically reduce the mortgage rate by a fraction of a percentage point. Although the cost of mortgage points can vary, borrowers are often required to pay 1 percent of their total loan amount to purchase a single mortgage point. Despite the significant up-front cost, buying down the rate with mortgage points may be worth the initial investment to get a reduced interest rate and save money on both a mortgage’s monthly payments and the total amount of interest owed.

Not all lenders offer mortgage points, and those that do may cap the number of points that a borrower can purchase. In addition, the exact cost of mortgage points and the rate discount they provide may vary from lender to lender. If homeowners plan to buy down the rate, they will want to check how each company handles mortgage points.

Our Top Picks

Homeowners may equate the best mortgage refinance companies with the lenders that can offer the lowest rate. Although cost is a major consideration, it’s important to look at the entire breadth of services, terms, and benefits that each company can offer.

Best Overall

PNC

See It

• Loan types: Fixed rate, ARM, FHA, VA, USDA, jumbo
• Loan terms: 10, 15, 20, or 30 years on fixed-rate loans; 7 or 10 years on ARMs
• Average closing costs: 3.5 percent of loan amount
• Prequalification process: Phone, agent
• Application process: Online, phone, agent
• NMLS Unique Identifier: 446303

Pros

• Relatively low mortgage rates and APR
• Varied fixed-rate loan terms from 10 to 30 years
• USDA loans supported
• HELOC financing available

Cons

• Limited cash-out refinance options

Why It Made the Cut: Eligible borrowers may qualify for low interest rates when refinancing with PNC. The lender also offers a range of term options on fixed-rate loans, as well as USDA loans and home equity line of credit (HELOC) financing. PNC could be a very appealing option for homeowners looking to lower their interest rate and APR, as the lender may offer mortgage rates that are on the lower end for 30-year fixed-rate loans. Qualifying for a lower interest rate could help borrowers reduce their monthly payments as well as the total amount of interest they will pay on their home loan. There are also a variety of fixed-rate loan terms to choose from, including 10-, 15-, 20-, and 30-year mortgages, which can make it easier for homeowners to find the right option to suit their needs. Although cash-out refinance options are limited, eligible homeowners can take advantage of other refinancing opportunities. For instance, PNC offers USDA loans that can help borrowers in rural areas save money on their mortgage with lower interest rates. Borrowers may also be interested in PNC’s HELOC options, which can be used to turn accumulated home equity into a revolving line of credit to pay for a wide variety of purchases and expenses.

Runner-Up

Caliber Home Loans

See It

• Loan types: Fixed rate, ARM, VA, FHA, USDA, jumbo, interest only
• Loan terms: 10 to 30 years on fixed-rate loans; 3, 5, 7, or 10 years on ARMs
• Average closing costs: Unknown
• Prequalification process: Phone, agent
• Application process: Online, phone, agent
• NMLS Unique Identifier: 15622

Pros

• USDA loans supported
• Varied ARM loan terms from 3 to 10 years
• Flexible refinancing options for self-employed borrowers
• Refinance possible in as little as 10 days

Cons

• Unknown average closing costs

Why It Made the Cut: With a wide variety of financing options and loan terms, as well as a speedy turnaround time on refinances, Caliber Home Loans may be a good choice for many borrowers. Homeowners interested in different types of loan terms and financing options may find the right lender with Caliber Home Loans. The company offers several loan terms to choose from on an adjustable rate mortgage (ARM)—3, 5, 7, or 10 years—which gives borrowers more flexibility when deciding how long they would like the fixed-rate period to last on this type of loan. Eligible homeowners may also qualify for a USDA loan refinance, which is not very common and may save them money on their mortgage while lowering their monthly payments. It’s unclear exactly how much homeowners will pay in closing costs when refinancing their mortgage with Caliber Home Loans, but they may be able to close on their refinance in just 10 days and avoid a protracted application process. In addition, self-employed borrowers may have an easier time qualifying for a refinance with Caliber’s flexible income documentation requirements. The company’s SmartSelf program accepts bank statements as proof of income even if the borrower is unable to present pay stubs or W-2 forms from an employer.

Best for Low Fees

Better

See It

• Loan types: Fixed rate, ARM, FHA, jumbo
• Loan terms: 10, 15, or 30 years on fixed-rate loans; 5, 7, or 10 years on ARMs
• Average closing costs: $1,500 to $3,000
• Prequalification process: Online
• Application process: Online
• NMLS Unique Identifier: 330511

Pros

• Relatively low closing costs
• No lender fees
• 24/7 responsive customer support

Cons

• VA loans unavailable

Why It Made the Cut: Homeowners looking to refinance their mortgage without paying a lot of money out of pocket may be interested in Better’s low closing costs and the lack of any additional lender fees. Better distinguishes itself as a mortgage refinance company by offering borrowers opportunities to refinance without paying a lot of money up front. For instance, Better doesn’t charge any lender fees, including application, origination, or underwriting fees, which can help lower the initial expense to refinance. On average, borrowers can expect to pay between $1,500 and $3,000 in closing costs—a relatively low amount when refinancing a mortgage. These cost savings may encourage more homeowners to consider refinancing their mortgage to take advantage of more favorable terms. Homeowners looking to refinance their conventional mortgage into a VA loan will need to look elsewhere, as Better is not a VA-approved lender. The mortgage company does offer other government-backed loans, though, including FHA loans. In addition, borrowers may feel more at ease working with a lender like Better that has around-the-clock customer support to answer questions or provide assistance whenever needed.

Best Online Experience

Rocket Mortgage

See It

• Loan types: Fixed rate, ARM, VA, FHA, jumbo, cash-out refi
• Loan terms: 15 or 30 years on fixed-rate loans; 7 or 10 years on ARMs
• Average closing costs: 3.3 percent of loan amount
• Prequalification process: Online, phone
• Application process: Online, phone, agent
• NMLS Unique Identifier: 3030

Pros

• Convenient mortgage management with mobile app
• Responsive online chat staffed by live representatives
• Auto, solar panel, and debt consolidation financing available to account holders

Cons

• Limited ARM options

Why It Made the Cut: With its helpful dedicated mobile app and online chat support, Rocket Mortgage may be a solid choice for borrowers interested in a strong digital experience when refinancing their home loan. Rocket Mortgage is a digital-focused lender, giving borrowers plenty of ways to manage their home loan online and with the help of digital platforms. The company’s dedicated mobile app, for example, allows borrowers to check in on their home loan at any time and from any location. They can schedule mortgage payments, retrieve documents such as interest statements, check their repayment timetable, and set up automatic payments whenever they like. If borrowers wish to refinance their mortgage at another date down the road, they can do so entirely within the mobile app. This one-stop-shop approach to loan management makes it easier and more convenient for borrowers to keep track of their mortgage. Rocket also maintains an online chat tool that site visitors and borrowers can use to speak directly to a company representative and ask questions about their refinancing options. This may be quicker than picking up a phone and calling a representative directly. It’s worth noting that Rocket’s ARM terms are somewhat limited, with 7- and 10-year ARMs available, but borrowers may still find those options to be more than sufficient to meet their refinancing needs. Homeowners who sign up for an account with Rocket Mortgage can also apply for other types of financing to help pay for a new car or solar panel installation. Account holders may be able to take out a loan to consolidate existing debt as well. Having more loan options may be appealing to homeowners who prefer the simplicity of working with one lender for all of their financing needs.

Best Application Process

Guaranteed Rate

See It

• Loan types: Fixed rate, ARM, VA, FHA, jumbo, cash-out refi, interest only
• Loan terms: 15 or 30 years on fixed-rate loans; 5, 7, or 10 years on ARMs
• Average closing costs: 3.5 percent of loan amount
• Prequalification process: Online, phone, agent
• Application process: Online, phone, agent, app
• NMLS Unique Identifier: 2611

Pros

• Varied prequalification options
• User-friendly refinance application via mobile app
• Multiple helpful online mortgage calculators

Cons

• 30-year fixed-rate loans may not be available

Why It Made the Cut: Guaranteed Rate presents many ways to help homeowners throughout the refinancing process, including prequalification tools, mortgage calculators, and the ability to refinance through the company’s mobile app. Homeowners will want to approach a mortgage refinance with as mu