8 Best Mortgage Refinance Companies of February 2023

Refinancing your mortgage is one way to improve your financial position, but for the move to make sense, you need to find the right lender. The best refinance companies will offer competitive interest rates, a smooth application process and a variety of loan options to choose from.

Before you begin your search, use Money’s mortgage refinance calculator to estimate how much you can save by reducing the interest rate on your home loan. Next, compare offers from multiple lenders. We think these eight mortgage lenders are the cream of the crop.

Our Top Picks for the Best Mortgage Refinance Companies of February 2023

• Rocket Mortgage – Best Refinance Lender Overall
• loanDepot – Best for Online Mortgage Refinancing
• Zillow – Best Marketplace
• Better – Best for Fast Closing Time
• Navy Federal Credit Union – Best Credit Union
• Ally Financial – Best for Jumbo Loans
• Nationwide – Best for Custom Loans
• Bank of America – Best for Member Discounts

Best Mortgage Refinance Reviews

Why we chose it: We chose Rocket Mortgage (formerly Quicken Loans) as the best overall mortgage refinance company for its excellent track record in customer satisfaction and web-based customer support. It’s also popular: In 2022, Rocket originated more mortgages than any other company in the United States.

Rocket Mortgage (NMLS ID# 3030) has ranked in the top 3 in the J.D. Power U.S Primary Mortgage Origination Satisfaction Study for eight consecutive years. You can choose to complete your application online, or by phone, with help from one of the company’s home loan experts. In many cases, you can also get in-person assistance from an independent mortgage broker affiliated with Rocket.

Rocket Mortgage’s offerings include Fannie Mae’s RefiNow and Freddie Mac’s Refi Possible, which are refinance options for homeowners with a debt-to-income ratio of up to 65% who currently have a mortgage with one of those government-sponsored enterprises. Homeowners who qualify for these programs will see a reduction of at least 0.5% of their interest rate, and can apply for a grant of up to $500 to cover appraisal costs. Applicants must have a good payment history, a FICO credit score of 620 or higher and at least 3% equity in a one-unit primary residence to be eligible.

Why we chose it: We chose loanDepot as the best online mortgage refinance company because of its widespread availability across the U.S.

loanDepot (NMLS# 174457) stands out for its “mello smartloan,” a digital portal that uses artificial intelligence to verify asset and employment details, perform credit checks and begin the home appraisal process. The online application can be completed in a matter of minutes.

Choosing loanDepot for a mortgage refinance comes with another perk: If you’ve refinanced with the company before, it will waive your lender fees and reimburse your appraisal fees on future refinances.

Why we chose it: We chose Zillow as the best mortgage refinancing marketplace for its ability to connect homeowners with a variety of licensed lenders throughout the country, and its array of tools that help guide the process.

Zillow Home Loans (NMLS ID#: 10287) is the affiliate company of Zillow, Inc., the real estate listing site, but it also offers access to thousands of lenders across the country, including mortgage bankers and brokers, credit unions and community banks.

Zillow Inc.’s Lender Directory allows you to search for a mortgage provider by city, state/territory or zip code. You can also search for a specific bank or loan officer if you have a recommendation from a friend or family member. You’ll be able to read customer reviews before deciding which lenders to apply with, and submit your information directly on Zillow’s website to be paired with local and national lenders (who will contact you directly).

Another neat Zillow feature is its mortgage refinance rate comparison tool, which lets you compare average interest rates for different types of loans (including conforming, government-backed and jumbo loans) as well as different term lengths. Updated daily, the tool can give you an idea of what mortgage interest rate you can expect to qualify for when you apply for a refinance, and compare the market average with the rate you’re offered.

As with any marketplace, once you contact a lender, you’ll be dealing with that company directly and Zillow will no longer be involved in the process.

Why we chose it: We chose Better as the best mortgage refinance company for fast closing times. Homeowners can get a rate quote and a letter of preapproval in just a few minutes — and it comes with a price match guarantee.

Better Mortgage (NMLS ID# 330511) is an online lender with a refinance process that’s fast and straightforward. It also offers some of the lowest closing costs in the industry.

Better says it can afford to forego some of the fees charged by traditional brick-and-mortar lenders — such as application, underwriting and origination fees — because they operate fully online. Additionally, it offers a price guarantee if another lender offers homeowners a more competitive price on one of the refinance products Better offers.

Better customers get direct access to a dedicated loan officer, who can help them navigate the application process by phone. Or they can opt to upload and sign all their documents through the lender’s website instead.

Why we chose it: We chose Navy Federal as the best mortgage refinance credit union because of its fast online pre-approval process, choice of loan terms and benefits for borrowers who are also selling.

Navy Federal (NLMS# 399807) has mortgage refinancing options for its members, ranging from 10- to 30-year loan terms for their VA Streamline (IRRL) and Homebuyers Choice. The lender also offers the Military Choice loan for those who have exhausted their VA loan option. In addition to VA loans, Navy Federal can refinance FHA and conventional loans.

Realty Plus and Navy Federal Title Services are tools that facilitate the mortgage refinance process for homebuyers looking to refinance or sell and buy new property. Realty Plus connects you with an agent coordinator to assist with your mortgage application. Further, if you close your mortgage with Navy Federal using Realty Plus, you can get between $400 and $9,000 cashback.

Navy Federal also offers HomeSquad, an option for potential borrowers to get a faster preapproval for a purchase or refinance loan. Once the application is submitted, HomeSquad allows borrowers to track their loan status 24/7 (online or through a mobile app), upload documents easily, request forbearance assistance and a number of other account activities.

Why we chose it: We chose Ally Financial as the best mortgage refinance company for jumbo loans due to its higher-than-average lending cap and lack of lender fees.

Ally Financial (NLMS# 181005) stands out for its jumbo loan offerings of up to $4 million. For this type of loan, Ally offers a higher lending amount than its competitors, which usually cap that amount at $2 million. Borrowers must pay a down payment of at least 20% for jumbo loans and provide evidence that they can cover expenses for a certain number of months. Unlike other lenders, Ally accepts restricted stock units as reserve capital.

New customers can apply, submit documents and sign paperwork online. Borrowers can also find rates and a refinance mortgage calculator, along with other information regarding refinancing and jumbo loans, on the Ally website.

Why we chose it: We chose Nationwide as the best mortgage refinance company for custom loans because of the variety of products and flexible lending options and its cash back perk.

Nationwide offers mortgage refinance loans in partnership with AXOS Bank (NMLS # 524995). The company provides a full gamut of loan options, including rate and term and cash-out refis, all of which can be customized to meet the borrower's needs.

Borrowers can also get up to 3% annualized cash back on mortgage payments made from Axos’ Total Loan Rewards Checking Account, which can add up to a tidy sum. Depending on the loan amount, and contingent on opening an Axos Bank Checking Account, the bank will either reduce or eliminate its lender fees.

Axos also offers a rate watch option to alert when mortgage rates reach your desired level.

Why we chose it: We chose Bank of America as the best mortgage refinance company for member discounts. Its Preferred Rewards program offers significant price reductions on purchase and refinance closing costs.

Bank of America (NMLS# 399802) members can benefit from its Preferred Rewards program by qualifying for a closing cost reduction of up to $600 from their purchase or refinance origination fees.

The program works in tiers ranging from Gold to Platinum Honors, with discount levels based on members’ banking and Merrill investment account balances.

Like many other lenders, Bank of America provides a range of digital services to borrowers, including an online tool to help track the progress of your mortgage loan or refinance application in real time.

Other mortgage refinance companies we considered

Through our research on the mortgage lending industry, we found that many of the biggest lenders don’t necessarily offer the best refinance products. (Though they might excel in other areas.)

Chase Review

Why we didn’t choose it: We didn’t choose Chase (NMLS# 399798) because of the high number of regulatory actions and customer complaints filed with the Consumer Financial Protection Bureau within the past five years.

PNC Bank Review

Why we didn’t choose it: We didn’t choose PNC Bank (NMLS# 446303) because the application process cannot be fully completed online.

SunTrust Review (now Truist)

Why we didn’t choose it: We didn’t choose SunTrust (NMLS# 399803) because there is no transparent information on fees and closing costs on the website.

Alliant Credit Union Review

Why we didn’t choose it: We didn’t choose Alliant Credit Union (NMLS# 197185) because of the limited number of refinancing options available.

Guild Mortgage Review

Whe we didn’t choose it: We didn’t choose Guild Mortgage (NMLS# 3274) because its loan products are not available in all states.

U.S. Bank Review

Why we didn’t choose it: We didn’t choose U.S. Bank (NMLS# 402761) because of its below-average customer rating.

AmeriSave Mortgage Review

Why we didn’t choose it: We didn’t choose AmeriSave Mortgage (NMLS# 1168) because of the high number of regulatory actions lodged against the company.

Veterans United Home Loans Review

Why we didn’t choose it: We didn’t choose Veterans United (NMLS# 1907) because it offers limited refinancing options.

Mortgage Refinance Guide

When you refinance, you replace your current loan with a new mortgage. Our mortgage refinance guide is designed to help people refinancing their home loans for the first time make an informed decision. Read on to learn about different types of mortgage products, the benefits of refinancing a mortgage and what documents financial institutions require for a complete application.

Types of mortgage refinance

By understanding the different loan types, you can zero in on the best mortgage refinance lenders and products for your needs.

Rate-and-term refinance

A rate-and-term refinance allows you to take advantage of low rates. You take out a new loan with the same loan balance as your existing mortgage. Ideally, you’ll get a low interest rate, a shorter term length or both. Rate-and-term is the most common type of refi.

What to know:

• You can also use this type of refi to switch from an adjustable-rate mortgage to a fixed-rate mortgage.

• Also known as a “no-cash-out refinance.”

What to watch out for:

• You’ll have to pay closing costs, as well as go through the appraisal process, for a second time.

Zero-closing-cost refinance

Some lenders offer “no-closing-cost” or “zero-closing-cost” refinance loans to qualifying applicants.

What to know:

• You’ll still pay closing costs (and any interest that accrues), but they'll be rolled into your mortgage loan and not an upfront cost.

What to watch out for:

• Closing costs are folded into the principal loan amount, so monthly payments are higher than rate-and-term refinance loans.

Cash-out refinancing

One of the benefits of homeownership is the long-term increase in home values. A cash-out refinance converts a portion of the home equity you’ve accumulated into cash, similar to a home equity loan or home equity line of credit (HELOC). A cash-out refi replaces your existing mortgage with a new loan at a higher balance.

What to know:

• Allows you to take advantage of an increase in your home’s value with a tax-free cash advance paid to you at closing.

• Many borrowers use these loans to fund home improvements.

What to watch out for:

• You could end up with a higher interest rate and monthly payment.

• Make sure you borrow an amount that’s feasible to pay off.

Cash-in refinance

A cash-in refinance allows borrowers to lower their mortgage principal during a refinance negotiation. With this type of loan, the borrower makes a lump sum payment on their mortgage, lowering the principal balance on their new loan.

What to know:

• This option may improve the chances of an underwater mortgage qualifying for a refinance.

• If you pay down enough of the principal to bring your home equity above 20%, it will eliminate your monthly private mortgage insurance (PMI) payments.

• Most lenders require a loan-to-value ratio (LTV) of at least 80%.

What to watch out for:

• Your funds will be tied to your home, so you won’t be able to use them to pay off other debt, cover emergency expenses or invest.

Streamline refinance

Streamline refinance allows borrowers to refinance existing government-backed loans, such as an FHA loan, USDA loan or VA loan, with limited documentation or underwriting.

What to know:

• These loans generally don’t require appraisals and may or may not require employment and income verification.

• You’ll need to show a history of on-time monthly mortgage payments.

What to watch out for:

• Government-backed loans come with specific qualification requirements for borrowers.

Low-income enterprise-backed mortgage refinance

In summer 2021, Fannie Mae and Freddie Mac implemented new refinance options for low-income borrowers. Eligible borrowers can now refinance their mortgage at a reduced interest rate and lower monthly payments.

What to know:

• According to the Federal Housing Finance Agency (FHFA), borrowers may save an estimated $100 to $250 a month.

To meet eligibility requirements, borrowers must:

• Have a mortgage backed by Fannie Mae or Freddie Mac (the Enterprises) for the house they live in

• Have an income at or below 80% of their residential area’s median income

• Have no missed payments in the past six months and no more than one missed payment in the past 12 months

• Have a debt-to-income ratio below 65% or a FICO credit score of at least 620

• Have a mortgage loan-to-value (LTV) ratio lower than 97%

• Other federal loan programs that could help consumers who are facing financial hardship include Hope for Homeowners (HFH) and the Home Affordable Refinancing Program (HARP).

What to watch out for:

• This option is not available for cash-out refinance loans

• You need to have lived in the home for at least one year before doing this kind of refi

• Only applies to single-family homes

How does refinancing work?

Refinancing a mortgage works by replacing your existing home loan with a new one. That means your interest rate, monthly payment and loan term will all change.

Say you obtained a $300,000 mortgage at 6% interest, with a monthly payment of $1,799. After 14 years, you have a remaining balance of $223,000 and decide to refinance into a new 30-year mortgage at 5% interest. Your new monthly payment will be $1,197, and your new payback time is 30 years.

Many homeowners are attracted to refinancing because of the possibility of finding lower interest rates, but there are other reasons for taking out a new home loan — like using home equity to pay off higher-interest debt and shortening the term of the loan.

If, for example, you have an outstanding balance of $247,000 on your 30-year mortgage after seven years at 6% interest, your current monthly payment would be about $1,499. You can refinance into a 15-year fixed-rate loan at 5%, which would bring up your monthly payment to $1,949, but you’ll pay off your home in a total of 22 years instead of 30 (and save a lot of money on interest in the process).

Should you refinance your mortgage?

If you’re on the fence about going through with a mortgage refinance, here’s some info on the pros and cons of refinancing, what the money can be used for, and the documentation you’ll need to provide to complete an application.

Under the right circumstance, refinancing can help:

• Secure a lower interest rate on your mortgage
• Lower your monthly payment
• Shorten your loan term
• Pay off higher-interest debt like credit cards

Should I refinance with my current lender?

Before selecting a refinance mortgage lender:

• Shop around and request loan estimates from multiple lenders

• Look into current mortgage rates to see if you can find a better APR than you have now

• Use our mortgage refinance calculator to get an idea of how much you could be saving.

What do you need to refinance your mortgage?

There are three primary factors lenders consider when reviewing mortgage refinance applications: credit score, debt-to-income ratio and loan-to-value ratio (LTV).

• A low debt-to-income (DTI) ratio: You need a DTI of up to 43% for conventional loans or less than 50% for an FHA mortgage refinance, according to the Consumer Financial Protection Bureau (CFPB). Use our DTI ratio calculator to figure out where you stand.

• A healthy FICO credit score: Most mortgage refinance lenders require a minimum credit score requirement of 620, but you’ll get the best rates for a score that’s 740 or higher.

• A Loan-to-value ratio (LTV) of 20% or more: LTV is the amount of the loan you want to take out divided by the appraised value of your home.

You will also have to submit additional paperwork related to your income and the property you are refinancing.

Documentation required to apply for a mortgage refinance:

☑ A copy of your government-issued ID or Social Security card

☑ Proof of income for the last 30 days

☑ W-2s for the past 2 years

☑ Federal tax returns (personal and business) for at least the last 2-3 years

☑ Written explanation if employed less than two years or if there’s a gap or change in employment

☑ Address of property to be refinanced and purchase contract

☑ Homeowners' insurance information such as the agent’s name and contact information

☑ Bank statements and statements of assets

☑ Bankruptcy/ discharge papers (if applicable)

When is refinancing your mortgage not the best idea?

Just because you can refinance doesn’t mean you should.

For starters, if your new interest rate isn’t at least 0.5 to 0.75 percentage points lower than your previous one, most experts argue it’s not worth it.

Refinancing also means new closing costs and other potential fees. If you won’t recoup those costs, it doesn’t make sense to refinance — even if you’re making a lower monthly payment. You should also reconsider a mortgage refinance if:

• Your refi terms won’t save you much in interest
• Your credit score has taken a dive since your original mortgage
• Your new minimum monthly payment will be out of your budget
• You have plans to move out in the near future

Latest News on Mortgage Refinance

A mortgage refinance isn’t a smart option for many homeowners right now.

Current mortgage rates have decreased by nearly 1% since early November and are now hovering around 6% for borrowers with excellent credit. However, those with a credit score of 700 or lower are seeing rates averaging above 7%. With rates remaining elevated for now, it is more important than ever to shop around for a mortgage lender to find the best option.

Many homeowners are currently sitting on a near-record amount of equity. As concerns over a recession mount, some may find a cash-out refinance, home equity line of credit (HELOC) or home equity loan an appealing option to help weather a financial downturn.

If you’re considering a rate and term refinance, it’s more important than ever to take steps to improve your credit score. Use our mortgage refinance calculator to see how your monthly payment could change with a higher score.

As with any type of loan, be sure to consider the pros and cons of a refinance before making a decision. If you decide to go ahead, these steps can help you get started:

1. Define your refinancing goal (e.g. lower your rate, shorten your term, etc.)
2. Check your home equity
3. Check your credit score and credit report
4. Calculate whether refinance costs will be worth it
5. Get your W2, 1099 forms and other documents ready
6. Shop for a lender
7. Lock in your rate

How We Chose the Best Mortgage Refinance Companies

Our methodology considered:

• Lenders that provide a quality customer experience with online tools, pre-approvals, discounts or exclusive refinance programs

• Lender size, reputation and number of complaints.

• Ratings and data from the Mortgage Bankers Association, J.D. Power’s U.S. Mortgage Origination Satisfaction Study and the NMLS (Nationwide Multistate Licensing System or “Nationwide Mortgage Licensing System”)

• Consumer feedback and expert input

Summary of Money’s Best Mortgage Refinance Companies of February 2023

• Rocket Mortgage – Best Refinance Lender Overall
• loanDepot – Best for Online Mortgage Refinancing
• Zillow – Best Marketplace
• Better – Best for Fast Closing Time
• Navy Federal Credit Union – Best Credit Union
• Ally Financial – Best for Jumbo Loans
• Nationwide – Best for Custom Loans
• Bank of America – Best for Member Discounts