Refinance
Refinancing options at competitive rates
Whether you’re looking to lower your interest rate, access your home's equity, consolidate debt or make home improvements, Dollar Bank offers a wide range of loan options to fit your refinancing needs. Refinancing options are also available for investment properties and second homes.
There are both home equity and mortgage options for refinancing.
If you're wondering if refinancing is right for you, below are some questions to get you started. Our mortgage experts are also here to help - find a mortgage expert near you!
Use your home's equity to reach your goals
How can a home equity loan to refinance your mortgage work to your benefit? Our loan experts break down everything you need to know and use a real-life example to simplify the details.
If you want to refinance your current mortgage or second lien position mortgage to a lower rate, access the equity in your home, or consolidate other high-interest debt, you may want to consider a home equity term loan.
If you want to refinance a first or second lien position mortgage or loan, be able to access the equity in your home when you need it, or have the convenience of a reusable line, you may want to consider a home equity line of credit (HELOC).
Dollar Bank makes refinancing easy and affordable with these money-saving benefits:
- No prepayment penalty
- No minimum initial draw required for home equity lines of credit
- Not near a Dollar Bank office? No problem, we’ll come to you. With our remote closing and convenient repayment options, we make borrowing with us easy.
Refinance your mortgage with confidence
Mortgage refinancing can be used to lower your interest rate, consolidate debt or make home improvements.
See how much you can save using our Time to Refinance? Mortgage Calculator. Or, try out our other mortgage calculators to determine a monthly payment, compare mortgages, calculate your debt-to-income ratio and more.
The best mortgage option for you could depend on how long you plan to stay in your home:
More than five years
You may want to choose a fixed rate mortgage. You’ll have the security of a fixed rate and payment throughout your term; you can build equity faster by refinancing into a lower interest rate and a shorter term, like a 15- or 20-year fixed-rate, without a big jump in your monthly payment; and you can choose a mortgage with or without closing costs.
Less than five years
You may want to choose an adjustable rate mortgage (ARM). You can save thousands in interest by refinancing into a lower interest rate and with no closing costs; and if you’re in the market for a jumbo loan, our ARMs have the same interest rates for higher loan amounts - up to $766,550.
Closing costs
Did you know that there are advantages to paying closing costs in certain situations?
Paying closing costs
If you plan to stay in your home long-term or keep the same mortgage for at least five years, it may make sense to pay closing costs and benefit from the lower interest rate. Many of the closing costs are fixed amounts. If you have a higher loan balance, your overall finance charge could be lower if you pay the closing costs.
Paying no closing costs
If you do not plan to stay in your home for more than five years or anticipate borrowing in the near future, opting a no closing costs mortgage may be more beneficial. Your interest rate will be a little higher, but you won’t have to worry about recouping your closing costs, which could take several years.
FAQs
There is a rule of thumb as far as an interest rate drop that would make it worth looking at refinancing. If rates drop 1% to 1.5% from the current rate, that is when you should take a look at refinancing. You should consider the total cost, how long it will take to recoup those costs and how long you actually plan on staying in the house.
If you do not plan to stay in your home for more than five years or anticipate borrowing in the near future, opting for a no closing cost mortgage may be more beneficial. Your interest rate will be a little higher, but you won't have to worry about recouping your closing costs, which could take several years.
If you plan on staying in the house a short amount of time, an adjustable rate mortgage (ARM) could be more beneficial since if offers lower monthly principal and interest payments. If you were using a three- or five-year ARM, the rate is fixed for those periods of time. For example, if you have a five-year ARM, the rate is fixed for five years and will adjust to the current rate after the fixed-rate period is up. But, there is borrower protection in the form of annual and lifetime rate caps. So, if you're going to be in the home less than five years, there'd be no reason to pay the higher rate. An ARM can also qualify you for a higher mortgage amount which means you can buy a larger or more expensive house. And, with an ARM, you may not have to refinance when the interest rates drop.
Typically a home equity loan that's used as a mortgage is shorter-term (10 or 15 years) than your traditional 30-year fixed-rate mortgage. If you're comfortable making those payments, it's a great option. You'll save a lot of money on closing costs than if you refinanced with a mortgage. If you plan on being in the house for a while, but are still comfortable with that payment, you'll build equity faster and pay off the loan sooner.
Additionally, refinancing with a home equity loan is a beneficial option if you're looking to do home improvements. Learn more about how using a home equity loan to refinance your mortgage can work to your benefit.
The information presented is general in nature and is for information purposes only. It is not intended to provide specific legal, tax or other advice to individuals.