Refinance calculator

Consider refinancing when interest rates drop significantly (typically 0.5-1% below your current rate), when your credit score has improved, when you want to change loan terms, or when you need to access home equity. Also consider refinancing to remove PMI or switch from an adjustable to fixed-rate mortgage.

Savings depend on your current rate, new rate, loan balance, and how long you stay in the home. A 1% rate reduction on a $300,000 loan could save you about $300/month. However, you must factor in closing costs (typically 2-5% of loan amount) and break-even time to determine if refinancing makes financial sense.

Refinancing costs typically include application fees, appraisal fees, title insurance, attorney fees, and origination fees. Total costs usually range from 2-5% of your loan amount. Some lenders offer 'no-cost' refinancing, but this usually means higher interest rates or rolling costs into the loan balance.

Cash-out refinancing allows you to borrow more than you owe on your current mortgage and receive the difference in cash. This lets you access your home's equity for home improvements, debt consolidation, or other major expenses. However, it increases your loan balance and monthly payments.

The refinancing process typically takes 30-45 days from application to closing. This includes time for application processing, home appraisal, underwriting, and final approval. The timeline can vary based on lender efficiency, loan complexity, and how quickly you provide required documentation.

Yes, most refinances require a new appraisal to determine your home's current market value. This affects your loan-to-value ratio and available loan programs. Some lenders offer appraisal waivers for certain low-risk loans, but most borrowers should expect an appraisal as part of the process.

Refinancing with bad credit is possible but challenging. You may face higher interest rates, limited loan options, or need more equity in your home. Consider improving your credit score first, or explore government programs like FHA Streamline refinancing if you have an existing FHA loan.

Refinancing to a 15-year mortgage can save you significant money in total interest and help you build equity faster. However, monthly payments will be higher. This makes sense if you can comfortably afford the higher payments and want to pay off your home sooner or save on total interest costs.