Let’s see how to identify the best mortgage refinance rates. Refinancing refers to the process of financing for at least a second time for a new loan at a lower interest rate. Homeowners have different views regarding the perfect time to refinance due to some factors. The main point is that cutting costs, even at least one percent, is the primary motivation for refinancing.
Best Mortgage Refinance Rates
Both the Federal Housing Administration (FHA) and Veterans Affairs (VA) are guiding homeowners with their refinancing decisions according to their own preferences. The average cost of an FHA loan is 4.73%, while VA loan has 4.50%.
An average FICO credit score of 652 and 22% equity will be given for the refinancers of FHA loan, while an average FICO credit score of 698 and 11% equity will be given for those who refinance VA loan.
These rates are then used for overall computation which will yield the borrower to decide the best mix of a type of mortgage loan as well as the specific refinancing rate. So, what are the best mortgage refinance rates based on this?
The Best Lenders
Generally, borrowers consider the lowest interest rates as the best mortgage refinance rates. However, a good mortgage interest rate is at most equal to the average mortgage type that a borrower chooses. The institutions that offer 30-year fixed mortgage types are Sebonic Financial, eRates Mortgage, CF Bank, HomeDirect Mortgage, TIAA Bank, Flagstar Bank, and Ally Bank. Among these organizations, based on the computation of the rates above, Sebonic Financial offers the lowest interest rate of 4.49%, while Ally Bank offers the highest interest rate of 5.17%. These same institutions also offer 15-year fixed mortgage types where Sebonic Financial offers the lowest interest rate of 3.87%, while Ally Bank offers the highest interest rate of 4.63%. The organizations that offer adjustable-rate mortgage types such as 7/1 ARM and 5/1 ARM are Sebonic Financial, eRates Mortgage, CF Bank, and CIT Bank. For 7/1 ARM, Sebonic.
Financial offers the lowest rate of 4.25%, while CIT Bank offers the highest rate of 4.90%. On the other hand, Sebonic Financial offers the lowest rate of 3.88%, while CIT Bank offers the highest rate of 4.88% for 5/1 ARM.
How to Determine the Best Mortgage Refinance Rates for You
To determine if a refinancing rate is good, you should discuss with your financial adviser if you are unsure of it. Check how much you will be able to save refinancing. Determine whether the revenue is greater than the cos, and what way, you can tell that you have saved enough after refinancing.
A good mortgage interest rate is at most equal to the average mortgage type that a borrower chooses. The different ranges of rates depending on the type of loan are the following: 30-year fixed loan type = 4.49% to 5.17%; 15-year fixed type = 3.87% to 4.63%; 7/1 ARM and 5/1 ARM (adjustable-rate mortgage types) = 4.25% to 4.90% and 3.88% to 4.88%, respectively.