Compare Mortgage Refinance Rates
Mortgage Refinance Offers Direct To You
Take the headache out of trying to find a lender that is perfect for your mortgage refinance. GeniusRates have streamlined the process of finding lenders with exceptional mortgage refinance offers for you. Complete our online request form above and compare mortgage refinance interest rates offers from competing lenders.
When Is It A Good Time To Refinance My Mortgage?
When you're making your decision, there are several things to keep in mind. If your current interest rate is significantly higher than today's lowest rates, you may be able to roll your loan costs into the loan and still get a lower rate than you have today, thereby reducing your interest payments and saving money immediately.
Second, if you are planning to stay in your home for at least three to five years, it may make sense to pay "points" (a point equals 1% of the loan amount) and closing costs to get the lowest available rate. And third, you can avoid laying out cash and still get a low rate by adding the points and closing costs to your new mortgage. Does that mean shouldering a lot of extra debt? Not necessarily. If you've had your current mortgage for at least three years, you've probably reduced your balance by several thousand dollars. So you may be able to tack your closing costs onto your new loan and still end up with a mortgage that's smaller than your original one -- plus, of course, a lower rate and lower monthly payment.
Refinance Mortgage Rates
To refinance or "refi" is defined by wikipedia as "Refinancing refers to the replacement of an existing debt obligation with a debt obligation bearing different terms. The most common consumer refinancing is for a home mortgage."
Wikipedia goes on to give you the advantages of refinancing:
Refinancing may be undertaken to reduce interest rate/interest costs (by refinancing at a lower rate), to extend the repayment time, to pay off other debt(s), to reduce one's periodic payment obligations (sometimes by taking a longer-term loan), to reduce or alter risk (such as by refinancing from a variable-rate to a fixed-rate loan), and/or to raise cash for investment, consumption, or the payment of a dividend.
In essence, refinancing can alter the monthly payments owed on the loan either by changing the loan's interest rate, or by altering the term to maturity of the loan. More favourable lending conditions may reduce overall borrowing costs. Refinancing is used in most cases to improve overall cash flow.
Another use of refinancing is to reduce the risk associated with an existing loan. Interest rates on adjustable-rate loans and mortgages shift up and down based on the movements of the various indices used to calculate them. By refinancing an adjustable-rate mortgage into a fixed-rate one, the risk of interest rates increasing dramatically is removed, thus ensuring a steady interest rate over time. This flexibility comes at a price as lenders typically charge a risk premium for fixed rate loans.
Going Back To The Old Ways Of Mortgage Lending
Some believe with the recent mortgage woes it is has been much harder to qualify for a refinance on your existing mortgage. It seems that now you have to have perfect credit and loads of equity in your home. But, that isn't the case. The lending institutions have just gone back to the old "conservative" ways of lending where they want you to put a down payment on your home and no you cannot finance 10 properties with a bad credit score and no income.
GeniusRates Services
Loans |
Auto |
Communicate |
|---|---|---|
| Mortgage Refinance | Auto Loans | GeniusRates Youtube |
| FHA Mortgages | Auto Warranty | GeniusRates Facebook |
| VA Mortgage | Insurance |
GeniusRates LinkedIn |
| Jumbo Loans | Insurance Rates | GeniusRates Email |
| Reverse Mortgage | Auto Insurance | Information |
| Home Equity Lines of Credit | Credit |
About Us |
| Home Improvement Loans | Credit Repair | FAQ |
| Debt Consolidation Loans | Credit Reports | Contact Us |
| Commerical Loans | Credit Cards | Advertise |
| Mortgage Loan Modification | ID Theft Protection | Sitemap |
Switching To A Fixed Rate Mortgage
By refinancing to a fixed rate mortgage, you will not only reduce your payment, you will also likely lock in an attractive rate for as long as you own your home. In fact, while one year ARMs currently offer tempting introductory rates averaging 5.59%, most experts recommend avoiding them, because you could easily find yourself facing sharply higher payments in the near future, even if interest rates don't rise. Why? Well, after the introductory rate expires, ARMs are typically pegged to the one year Treasury rate (recently 5.25%) plus 2.75 percentage points, with increases of as much as two points a year. Assuming interest rates don't change, you would pay 7.59% in the second year (the full two point increase) and 8% in the third year.
There are certain cases, however, where an ARM makes sense. If you are fairly certain you'll be moving within five years, you can save some money -- and avoid rising payments -- with a five year ARM, recently averaging 6.62%. Such loans offer a fixed rate for five years and adjust annually thereafter.
Mortgage Refinance Rates by State
Refinance To A Fixed Rate Mortgage
A fixed rate mortgage (FRM) is a mortgage loan where the interest rate on the note remains the same through the term of the loan, as opposed to loans where the interest rate may adjust or "float." Fixed rate mortgages are the most classic form of loan for home and product purchasing in the United States. The most common terms are 15-year and 30-year mortgages, but shorter terms are available, and 40-year and 50-year mortgages are now available (common in areas with high priced housing, where even a 30-year term leaves the mortgage amount out of reach of the average family).
Fixed rate mortgages are usually more expensive than adjustable rate mortgages. Due to the inherent interest rate risk, long-term fixed rate loans will tend to be at a higher interest rate than short-term loans. The difference in interest rates between short and long-term loans is known as the yield curve, which generally slopes upward (longer terms are more expensive). The opposite circumstance is known as an inverted yield curve and is relatively infrequent.
Refinance From An Adjustable Rate Mortgages (ARM)
An adjustable rate mortgage (ARM) is a mortgage loan where the interest rate on the note is periodically adjusted based on a variety of indices. Among the most common indices are the rates on 1-year constant-maturity Treasury (CMT) securities, the Cost of Funds Index (COFI), and the London Interbank Offered Rate (LIBOR). A few lenders use their own cost of funds as an index, rather than using other indices. This is done to ensure a steady margin for the lender, whose own cost of funding will usually be related to the index. Consequently, payments made by the borrower may change over time with the changing interest rate (alternatively, the term of the loan may change).
Home Mortgage Interest Deduction
A home mortgage interest deduction allows taxpayers who own their homes to reduce their taxable income by the interest paid on the loan which is secured by their principal residence (or, sometimes, a second home).
Under 26 U.S.C. § 163(h) of the Internal Revenue Code, the United States allows a home mortgage interest deduction, with several limitations. First, the taxpayer must elect to itemize deductions, and the total itemized deductions exceed the standard deduction (otherwise, itemization would not reduce tax). Second, the deduction is limited to interest on debts secured by a principal residence or a second home. Third, interest is only deductible on up to $1 million of debt used to acquire, construct, or substantially improve the residence, or on up to $100,000 of home equity debt regardless of the purpose or use of the loan.
[All of the information provided here is intended as a convenient source of tax information. This information is general in nature, is not complete, and may not apply to your specific situation. Before relying on this information, you should consult your own tax advisor regarding your tax needs. GeniusRates makes no warranties and is not responsible for your use of this information or for any errors or inaccuracies resulting from your use. Please consult your tax attorney.]
Refinance on a FHA Mortgage
The Federal Housing Administration, generally known as "FHA", is the largest government insurer of mortgages in the world. A part of the United States Department of Housing and Urban Development (HUD), FHA provides mortgage insurance on single-family, multifamily, manufactured homes and hospital loans made by FHA-approved lenders throughout the United States and its territories.
Get A Quote For A FHA Loan By Clicking Here
While borrowers must meet certain requirements established by FHA to qualify for the insurance, lenders bear less risk because FHA will pay the lender if a homeowner defaults on his or her loan. FHA has insured over 37 million home mortgages and 47,205 multifamily project mortgages since 1934. Currently, FHA has 5.2 million insured single-family mortgages and 13,000 insured multifamily projects in its portfolio. Clearly, FHA provides a huge economic boost to the country in the form of home and community development, particularly in today's challenging financial climate. Get A Quote For A FHA Loan By Clicking Here.
