Rate-and-Term Refinance Guide
A simple guide to lowering your rate, changing your term, or both.
A rate-and-term refinance replaces your existing mortgage with a new one to secure a lower interest rate, shorten or extend your loan term, or both. It does not include taking cash out. This guide explains how it works, who qualifies, and when it makes financial sense.
- Lower your monthly payment
- Reduce your interest rate
- Shorten your loan term to pay off faster
- Switch from an ARM to a fixed rate
- Remove mortgage insurance (if eligible)
- Homeowners wanting a lower rate
- Borrowers wanting a shorter payoff timeline
- Anyone wanting to stabilize payments with a fixed rate
- Homeowners removing PMI after equity increases
- Borrowers improving long-term financial stability
- Acceptable credit profile
- Stable income and employment
- Home appraisal confirming value
- Debt-to-income ratio within guidelines
- No cash-out requested
- Apply for the refinance
- Complete income and credit review
- Get a home appraisal
- Choose your new rate and term
- Close on the new mortgage
- Old loan is paid off and replaced
- Standard refinance closing costs
- Appraisal fee
- Title and escrow fees
- Optional discount points
- Prepaid taxes and insurance
- Primary residences allowed
- Second homes allowed
- Investment properties allowed
- No cash-out permitted
- Review your current rate and payment
- Compare new rate options
- Decide on a shorter or longer term
- Start your refinance application
- Prepare income and asset documents
Get a personalized rate-and-term refinance review to see how much you can save.
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