Financing strategy · Refinance
Rate and Term Refinance
A rate and term refinance replaces your current mortgage with a new one to change the interest rate, the loan term, or the loan program itself. No meaningful cash is taken out beyond limited closing cost financing, which typically keeps guidelines and pricing more favorable than a cash out refinance.
Who it is designed for
- Homeowners whose current rate is above available market pricing
- Homeowners moving from an adjustable rate to a fixed rate
- Homeowners shortening a term to build equity faster
- FHA borrowers moving to conventional financing to end mortgage insurance
Eligible occupancy types
- Primary residence
- Second home
- Investment property
Down payment or equity
Not applicable, though you may bring funds to close or to reach a target loan to value.
Major benefits
- Potentially lower payment or lower total interest depending on terms
- Move from adjustable to fixed for payment stability
- Change loan type to remove FHA mortgage insurance when you qualify
Important considerations
- Closing costs must be weighed against the monthly change and how long you will keep the home
- Restarting a 30 year term can increase total interest even at a lower rate
- Rates change daily and cannot be promised in advance
How qualification generally works
- Current appraised value and remaining equity
- Income, credit and debt review
- Payment history on the existing mortgage
Documents commonly requested
- Photo ID and Social Security number for each borrower
- Most recent pay stubs covering a full 30 day period, if you receive W2 wages
- W2s and/or federal tax returns for the most recent years requested
- Two months of asset statements for accounts used for down payment and reserves
- Current mortgage statement, homeowners insurance and property tax information on properties you own
- Explanations for large or non payroll deposits
Frequently Asked Questions
Related programs and next steps
Cash Out Refinance
Replace your mortgage with a larger one and take the difference in cash.
Learn more RefinanceRemoving Mortgage Insurance
Options for ending monthly mortgage insurance when you have enough equity.
Learn more RefinanceDebt Consolidation
Use home equity to combine higher rate balances into one payment.
Learn moreConsidering rate and term refinance?
We will review your documents, compare the realistic options, and give you a written preapproval you can use with confidence. Nothing on this page is a commitment to lend.