Mortgage borrowers may have a chance to lower the cost of their monthly mortgage payments by refinancing their mortgage.
Through refinancing, homeowners can save money by locking in a lower rate (if their existing mortgage has a higher rate than current market rates), or reducing the length of their mortgage so their home is paid off faster. Refinancing your mortgage is also a good way to tap your home equity without selling your home.
The main key to any of these strategies is to first shop around for lenders who offer the best deals (low rates and low fees). Forbes Advisor compared dozens of lenders to come up with this comprehensive list of the best lenders for borrowers looking to refinance.
We looked at four main categories: the borrower’s ability to get a loan, affordability, loan options and funding speed. Our goal is to make comparison shopping easier for you by selecting lenders that stand out in these areas.
Best Mortgage Refinance Companies of 2022
- Best Overall: Quicken Loans (Rocket Mortgage)
- Best All-in-One Service: Nationwide Home Loans.
- Best for Customer Service: AmeriSave Mortgage.
- Best Online Lender: LenderFi.
- Best Bank: Bank of America.
- Best Credit Union: Alliant Credit Union.
- Best for Fees: Better.com.
It’s best to refinance with your current mortgage lender if it can offer you a better deal than the other ones you’ve looked at. You won’t know if this is the case until you’ve put in the work to compare rates from at least a couple other mortgage brokers or companies.
Best Cash-Out Refinance Lenders
A cash-out refinance could be right for you if you need money for home repairs or renovations, or if you want to consolidate high-interest debt. The process involves refinancing your home for more than you owe on the existing mortgage. You get the difference to use on whatever you need. It can be a helpful way to tap your home’s equity for major expenses. Your new home loan will have new terms and will reflect current mortgage interest rates, so consider how the costs would differ from your original home loan. Options for cash-out refinance lenders are extensive, from all-digital outfits with speedy online applications to major banks with branches nationwide for in-person service. To help you narrow down your choices, NerdWallet has picked some of the best cash-out refinance lenders in several categories so you can quickly determine the right one for you.
Bank of America refinance rates
Paying down your mortgage helps build equity in your home (one of the reasons a mortgage is considered “good” debt to have). But you don’t have to wait to completely repay your mortgage or sell your home to access that equity. You can convert what equity you have into cash and continue paying off your mortgage with cash-out refinancing. Cash-out refinancing replaces your current home mortgage with another, bigger mortgage, allowing you to access the difference between the two loans (your current one and the new one) in cash. The cash amount is based on the value of the equity you’ve built up in your home. The money can go toward virtually any purpose, such as home remodeling, consolidating high-interest debt or other financial needs.
How does a cash-out refinance work?
The process for a cash-out refinance is similar to that of a regular refinance of a mortgage (aka a rate-and-term refinance), in which you simply replace your existing loan with a new one, usually at a lower interest rate or for a shorter loan term, or both. With a cash-out refinance, though, you also withdraw a portion of your home’s equity in a lump sum. So, your new loan amount will be higher — by the amount equal to the equity you’re drawing upon.