There so many types of refinance loans out there it can it can be intimidating to try to choose the right one.
But the choice is really quite simple. It takes a few steps and you’ll know without a doubt which refinance option is best for you.
Step #1: Find Out What Kind of Loan You Have Now
The most important item to find your perfect refinance is which type of loan you currently have. It can be tough to find the paperwork you signed when you purchased or refinanced your home so take a look at your mortgage statement. It probably tells you whether your loan is an FHA, VA, USDA, or conventional loan.
Step #2 Pick Your Refinance
Your current loan is FHA >> This is a no brainer. You’ll want to choose an FHA Streamline Refinance. Why? You don’t need an appraisal or income documentation. Plus rates are incredibly low. You can start saving money faster than you thought with many lenders completing the process in less than 30 days.
You have a conventional loan>> These are loans owned by Fannie Mae or Freddie Mac. Even if you make your mortgage payment to Wells Fargo, Bank of America, US Bank, or some other big name, your loan is probably owned by Fannie or Freddie.
If that’s the case, pick a Conventional Refinance. There are two flavors of conventional: 1) HARP, for homeowners with less than 20% equity in their homes and; 2) Standard conventional loans, for homeowners with more than 20% equity. It’s that simple!
Your current loan is VA>> This is another really easy decision. There’s no loan type available quite as easy as the VA Streamline Refinance. There’s no appraisal required, so your home’s current value doesn’t matter. You won’t need to provide paystubs, W2s or even bank statements to qualify.
If you have current or previous military experience, there’s a good chance that you have a VA loan and are eligible for this program.
FACT: According to a recent report from one of the nation’s largest mortgage software companies, VA loan rates are 0.25% lower on average than conventional loans!¹
There are very few simpler ways to save money than with a VA refinance.
Banks Hope You Don’t Discover This Secret
Bankers don’t want you to know how easy it is to choose a refinance. They would rather hold the keys to cost savings and only open the doors they want to open.
But as a knowledgeable consumer, you choose the refinance program that’s best for your situation.
Banks also don’t want you to shop around.
According to ConsumerFinance.gov, mortgage consumers should get quotes from at least three separate lenders. Then, and only then, should you make a decision.
Fortunately there are ways to connect with multiple lenders at once. When consumers on this site complete a short one-minute online form, we match them with lenders who offer competitive rates and fees for their requested refinance.
Rates are some of the lowest in history. Get your rate quote and lock in before rates rise.
¹Ellie Mae Origination Insight report. http://www.elliemae.com/origination-insight-reports/Ellie_Mae_OIR_SEPTEMBER2015.pdf