Getting the best rate on a mortgage refinance requires careful comparison of loan offers from multiple lenders. To ensure you get the best deal, follow these steps:1.
Request loan estimatesfrom multiple lenders. This is the most reliable way to get the lowest refinance rate. When talking to a lender, ask why their rate or closing costs are different from other quotes you've received.2.Lenders are required to provide formal loan estimates before refinancing, so you can compare costs.
If you have a low debt-to-income ratio, a good credit score, and a reliable source of income, you're in a strong position to negotiate.3.The Annual Percentage Rate (APR) can be used to compare offers for adjustable-rate mortgages, even though rates may fluctuate over time. The APR is calculated by assuming that you will have the mortgage for the entire term of the loan and that you will simply pay the new rate each time it is reinstated.4.Since no one can predict what effect interest rates will have in the future, the calculation simply assumes that the base rate, or rate index, on which the rate adjustments are based will remain unchanged.5.Before you begin your search, use Money's mortgage refinance calculator to calculate how much you can save if you lower the interest rate on your home loan.6.