Loan Types: Refinances
For borrowers with a current mortgage, there are several options for refinancing. Like other loans, you'll want to consider your goals: to secure a lower rate, to lower your monthly payment, to move from a adjustable-rate loan to a fixed-rate loan, or other priority. With your goal in mind, our team will select a program that fits your needs.
Loan Categories
When refinancing, you may qualify for several of the same loan types as a purchase: conventional, non-QM, adjustable rate, or more. Generally, we consider mortgage refinances as fitting one of two categories, a Rate-and-Term or Cash Out Refinance.
Rate and Term
In a Rate-and-Term Refinance, the original loan amount remains unchanged. The borrower is securing a different term on the loan (for example, extending the length to lower monthly payments) and/or lowering the rate based on existing loan offerings.
Cash Out
In a Cash Out Refinance, the borrower has some equity in the home, and is refinancing the loan amount to exceed what they currently owe. The difference in what is owed and the new loan amount allows for a cash withdrawal, which can be put towards other expenses.