Just because you got a mortgage at a particular interest rate doesn’t mean that you are going to be stuck with that particular interest rate forever.
Every day, interest rates move up or down based on supply and demand of investors on Wall Street. And when interest rates go down lower than when you got your original loan, you can simply refinance and get a new loan at a new interest rate. When interest rates drop, many times it seems like everyone wants to refinance at the same time – and lenders will get backed up and your refinance process may take weeks or even months. This is also commonly referred to as a “refinance boom”.
Depending on what type of mortgage loan you currently have, you may be eligible for certain types of special refinance programs. For example, if you happen to have an FHA loan, you may qualify for an FHA streamline refinance which requires much less documentation than a regular refinance.
Some of the most popular refinance programs include:
- FHA streamline refinance
- VA IRRRL refinance
- VA streamline refinance
- USDA refinance
- Jumbo loans refinance
When thinking about a refinance, be sure to speak with multiple lenders because each lender will have a different interest rate and charges associated with the refinance program. Lenders are free to set their own rates and fees, so by shopping around you can be sure to get the best deal. Don’t forget: when shopping around, be sure to get the offer from the lender in writing – that way you will protect yourself from being surprised at the closing table with a higher rate and costs than you were promised in the beginning.