In 2020, mortgage rates hit notable lows. As a result, many homeowners saved money by refinancing at a lower rate. Although rates have gone up this year, it’s still relatively low, prompting more homeowners to consider refinancing now.
If you’re one of the homeowners looking to refinance but don’t know where to start? Then, this article is for you. Refinancing your mortgage may seem like a challenge, but it won’t be for you after reading this article.
This guide will help you understand how refinancing your mortgage works and which lender you should approach.
Refinancing Your Mortgage: What to Look For?
First thing first, you should look for a low mortgage rate. It’s also important to look into the mortgage lenders’ expertise, variety of loan options, and customer service. Our top five mortgage refinance companies excel well in these categories.
But at the end of the day, it’s entirely up to you. It depends on your financial goals and the type of loan you’re comfortable with.
With that said, here are our picks for the best mortgage refinance companies that stood out in the U.S.
Quicken Loans is one of the best refinance mortgage lenders in the market. They have an excellent track record in customer service. They offer exclusive membership discounts for refinancing costs.
With Quicken Loans, you can import your property taxes and home insurance information on their digital platform. You can also adjust your repayment terms, your rates, and other costs to see payment options.
They offer three different loans:
- Adjustable-rate mortgage loans
- Conventional 15 and 30-year loan
- Government-backed loans (FHA and VA loans)
If asked which lender is the rising star? The answer is Freedom Mortgage. It offers the lowest mortgage rates among the top refinance lenders. It is affiliated with the Federal Housing Administration and the U.S. Veterans Affairs mortgage program.
If you have credit score challenges, Freedom Mortgage can help you with that as well. It recognizes VA and FHA applicants with scores as low as 550 or 620 for conventional loans.
Keep in mind, though, that Freedom Mortgage is not like other digital mortgage companies. Someone from the lender will help you through the refinance process.
Better Mortgage is another great option for refinancing purposes. It is one of the top mortgage refinance companies in the U.S. The reason is Better Mortgage’s 30-year mortgage rates in 2020 averaged 3.03%. It is the lowest on our list. Better Mortgage’s loan costs are the lowest as well.
However, Better Mortgage doesn’t offer government-backed VA or USDA loans. VA Streamline Refinance (IRRRL) borrowers looking for an IRS streamline refinance should look elsewhere.
If you’re also looking for refinancing options on FHA or a conventional loan with Better Mortgage, you require a minimum FICO score of 620.
Customer reviews from this company were only slightly below average but still acceptable. And if you want to get a low-cost mortgage, Better Mortgage is a good option.
Guaranteed Rate is popular because of its user-friendly and highly effective technologies. A lot of people choose to work with this mortgage lender. One of the reasons is its outstanding online customer reviews.
Meanwhile, Guaranteed Rate’s 2020 average mortgage rate of 3.17% came in third place. However, its upfront loan costs were higher than most.
Guaranteed Rate has 400 branches located across the country. It is a good choice for people who prefer to work with people instead of using software.
Bank of America
If you’re looking for excellent customer support, Bank of America is the go-to mortgage lender.
Bank of America obtained an impressive 860 in the J.D. Power 2020 Mortgage Satisfaction Study, the highest on the list. It also performed well in online customer reviews.
In 2020, its mortgage rates were at 3.19%, slightly higher than the average on the list. If you want to refinance your home with Bank of America, you need a 620 credit score.
The kind of loan for your new mortgage should not be the same as your old one. There are benefits to switching loans. Refinancing may help you get a lower monthly payment and a shorter term on your mortgage.
If you have a lot of debt and the interest rates continue to increase, then you should consider refinancing your mortgage. Go over the list, and hopefully, you’ll find the right lender for your needs.