Best Mortgage Refinance Lenders of July 2022
If you're interested in refinancing your mortgage to get a lower rate or achieve another financial goal, check out our list of some of the best refinance lenders.
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Low interest rates have compelled many homeowners to refinance their mortgages over the past couple of years, and borrowers who haven't refinanced recently could still save.
Whether you want to refinance to take advantage of relatively low rates, cash out some of your home equity or change your loan term, NerdWallet has picked some of the best refinance lenders in a variety of categories so you can determine which one is right for you.
Low interest rates have compelled many homeowners to refinance their mortgages over the past couple of years, and borrowers who haven't refinanced recently could still save.
Whether you want to refinance to take advantage of relatively low rates, cash out some of your home equity or change your loan term, NerdWallet has picked some of the best refinance lenders in a variety of categories so you can determine which one is right for you.
Best Mortgage Refinance Lenders
| Lender | NerdWallet rating | Min. credit score | National / regional | Learn more |
|---|---|---|---|---|
 Rocket Mortgage, LLC: NMLS#3030 Learn more at Rocket Mortgage, LLC | Best for refi loan options | 620 | National | Learn more at Rocket Mortgage, LLC |
 NASB: NMLS#400039 Learn more at NASB | Best for active military members and veterans | 620 | N/A | Learn more at NASB |
 Watermark Home Loans: NMLS#1838 Learn more at Watermark Home Loans | Best for refi loan options | 620 | N/A | Learn more at Watermark Home Loans |
 NBKC: NMLS#409631 Learn more at NBKC | Best for low origination fees | 620 | N/A | Learn more at NBKC |
 SoFi: NMLS#1484615 Learn more at SoFi | Best for digital convenience | 620 | N/A | Learn more at SoFi |
 BNC National Bank: NMLS#418467 Learn more at BNC National Bank | Best for low origination fees | 640 | N/A | Learn more at BNC National Bank |
 Pennymac: NMLS#35953 Learn more at Pennymac | Best for rate transparency | 620 | N/A | Learn more at Pennymac |
 Better: NMLS#330511 Learn more at Better | Best for digital convenience | 620 | National | Learn more at Better |
at Rocket Mortgage, LLC
Rocket Mortgage, LLC: NMLS#3030
Min. credit score
620National / regional
Nationalat Rocket Mortgage, LLC
at Watermark Home Loans
Watermark Home Loans: NMLS#1838
Min. credit score
620Min. down payment
3%at Watermark Home Loans
at BNC National Bank
BNC National Bank: NMLS#418467
Min. credit score
640Min. down payment
3%at BNC National Bank
at Pennymac
Pennymac: NMLS#35953
Min. credit score
620Min. down payment
3%at Pennymac
at Better
Better: NMLS#330511
Min. credit score
620National / regional
Nationalat Better
More of NerdWallet's best mortgage refinance lenders
Best for low origination fees | |
Best for refi loan options | |
Best for digital convenience | |
Best for refinancing overall |
Why refinance your mortgage?
There are multiple reasons to refinance your mortgage. People usually refinance to save money, either in the short run or the long run, and sometimes to borrow against their equity. Here are some of the main reasons to refinance:
To get a lower mortgage rate. If mortgage interest rates fall after you get the loan, you may be able to refinance to a lower rate. This can result in smaller monthly payments.
To shorten the term. Refinancing from a 30-year mortgage to a shorter-term loan (15 or 20 years, most commonly) might increase your monthly payment (even with a lower interest rate), but it decreases the overall interest you pay over the life of the loan.
To get rid of mortgage insurance. When you buy a home with a down payment of less than 20%, you have to pay for mortgage insurance. Refinancing is one way to stop paying private mortgage insurance, and it's the only way to get rid of FHA mortgage insurance.
To replace an adjustable-rate mortgage, or ARM, with a fixed-rate loan. Rather than enduring the uncertainty of annual interest-rate adjustments with an ARM, you might refinance to a fixed-rate loan so you don't have to worry that the rate will rise.
To get your hands on equity. With a cash-out refinance, you borrow more than your current loan balance and take out the difference in cash. A cash-out refinance is a popular way to pay for home improvements.
» MORE: Compare today's refinance rates
Common refinance requirements
In order to qualify for a mortgage refinance, you will need to meet the criteria set by your lender and loan program:
Credit score: A higher credit score can help you secure the lowest refinance interest rate. Government-backed refinance loans typically have lower credit score requirements than conventional loans. With an FHA cash-out refinance, the minimum score requirement is 500, for example. With a conventional refinance, it’s at least 620. But lenders are permitted to set higher minimums if they choose.
Debt-to-income ratio: Your debt-to-income ratio is the portion of your gross income that goes to paying your debt. Many lenders require a DTI below 36%. You can refinance a mortgage with a higher DTI, but you may pay a higher interest rate.
Home equity: Your home equity is the value of your home minus what is owed on the mortgage. The amount of equity you need to refinance varies by lender and type of mortgage, but 20% equity is a common requirement.
Refinance wait period: While you can refinance as often as you want, some lenders require a “seasoning” period between loans. With a conventional cash-out refinance, for instance, you will have to wait six months. If you are refinancing an FHA, VA, or USDA mortgage, the waiting time varies between six and 12 months.
Types of mortgage refinances
Whether you’re looking to refinance a conventional or government-backed mortgage, there are generally three types of refinances:
Rate and term refinance: A rate-and-term refinance is exactly what it sounds like: you refinance your mortgage to reduce the interest rate, shorten the term of the loan, or both.
Cash-out refinance: A cash-out refinance is when you replace your mortgage with a new one for more than your current loan balance. The difference goes to the homeowner as cash that can be used for home improvements or other financial responsibilities. There are conventional, as well as FHA and VA cash-out refinancing options.
Streamlined refinance: The FHA, VA and USDA offer streamlined refinancing options that may allow you to skip the usual appraisal and credit check, saving you time and money. The FHA streamline and VA IRRRL both require that the refinancing result in a financial benefit: either a reduction in your monthly payment or interest rate.
Choosing a refinance lender
Whether you’re looking for the reach of a traditional bank or the personalized service of a credit union, always shop multiple lenders and compare the interest rate and terms each lender offers. Even though it might be easy to refinance with your current mortgage lender, it may not offer the best deal.
Everything can be negotiated. Your lender is required to provide you with a Loan Estimate after you apply. Compare fees listed under the "origination charges" on the document. If you are not comfortable with a fee, negotiate for it to be removed or reduced.
What is the real cost of your mortgage? Look at the annual percentage rate, or APR. This number covers all the costs of the mortgage including the interest rate and fees.
More from NerdWallet
Last updated on April 18, 2022
Methodology
The star ratings on this page reflect each lender's performance in NerdWallet’s refinance category. We scored the category and chose lenders for this page using the following methodology:
NerdWallet reviewed nearly 60 mortgage lenders, including the majority of the largest U.S. mortgage lenders by annual loan volume (lenders had to have at least a 1% market share), lenders with significant online search volume and those that specialize in serving various audiences across the country.
All reviewed mortgage lenders that offer more than one refinance product were evaluated based on (1) the portion of their business dedicated to refinance lending, (2) their refinance origination fees, (3) their rate transparency and (4) the ease of their online application. The highest scoring lenders appear on this page.
NerdWallet solicits information from reviewed lenders on a recurring basis throughout the year. All lender-provided information is verified through lender websites and interviews. We also utilized 2020 HMDA data for origination volume, origination fee, rate spread and share-of-product data.
To recap our selections...
NerdWallet's Best Mortgage Refinance Lenders of July 2022
- Rocket Mortgage, LLC: Best for refi loan options
- NASB: Best for active military members and veterans
- Watermark Home Loans: Best for refi loan options
- NBKC: Best for low origination fees
- SoFi: Best for digital convenience
- BNC National Bank: Best for low origination fees
- Pennymac: Best for rate transparency
- Better: Best for digital convenience
Frequently asked questions
There are multiple reasons to refinance your mortgage. Saving money is a big one: Getting a lower rate brings down your monthly payments, while shortening the term means you'll pay less total interest. A mortgage refinance calculator can help you see how much you'll save and when you'll break even.
Not necessarily. Even though it might be easy to refinance with your current mortgage lender, it may not offer the best deal. Shop at least three mortgage refinance lenders and compare the interest rate and terms each lender offers.
Refinance rates are in constant flux and vary based on economic trends, like job growth and inflation. But the rate you're offered will also depend on your individual financial situation, and factors like your credit score and the loan-to-value ratio of your refinance. Get quotes from multiple lenders to find the best refinance rates.
In order to qualify for a mortgage refinance, you will need to meet the criteria set by your lender and loan program. These can include income requirements, a minimum credit score, a maximum debt-to-income ratio and sufficient home equity.
The first step in refinancing is determining your goal. That will help you decide whether you need a rate-and-term refinance, a cash-out refinance or another type of mortgage refinance. Once you know what you're looking for, you’ll shop for a refinance lender, apply and close on your new mortgage, the same way you did when you bought the home.
You can generally refinance as often as it makes financial sense to do so. There is an exception: Some lenders require "seasoning" between refinances — in other words, they require you to have the loan for a specified number of months before refinancing again.
