Best Refinance Mortgage Companies of 2020

In the heavy shadow of coronavirus, many banks and lending institutions are making special concessions for homeowners struggling from 2020’s economic downturn. While the coronavirus has created hardship for some American families, it has also presented a glowing opportunity to refinance your home loan for far more favorable terms.

Finding the best mortgage refinance companies isn’t easy — you’re agreeing to pay a new company for years to come, so you should take the time to ensure you pick the best one. We used our proprietary SimpleScore measuring system to rate and review the best refinance companies to make your decision easier.

In this article

    Current refinance rates

    According to Bankrate’s latest survey of the nation’s largest mortgage lenders, these are the current refinance average rates for a 30-year, 15-year fixed and 5/1 adjustable-rate mortgage (ARM) refinance rates among others.

    Product Interest Rate APR
    30-Year Refinance Rate3.170%3.380%
    30-Year FHA Refinance RateN/AN/A
    30-Year VA Refinance Rate3.150%3.330%
    30-Year Jumbo Refinance Rate3.220%3.280%
    20-Year Fixed Refinance Rate3.190%3.430%
    15-Year Fixed Refinance Rate2.640%2.850%
    15-Year Jumbo Refinance Rate2.660%2.700%
    10/1 ARM Refinance Rate3.180%3.960%
    5/1 ARM Refinance Rate3.180%4.100%
    5/1 ARM Jumbo Refinance Rate3.030%4.050%
    7/1 ARM Refinance Rate3.130%3.990%
    7/1 ARM Refinance Jumbo Rate3.080%3.980%

    Rates data as of 10/19/2020

    The 6 best mortgage refinance companies of 2020

    Mortgage refinance lenders at a glance

    Lender30 Year Fixed APRMin Credit ScoreFees
    Sofi3.325% – 4.310%VariesLender fees: varies
    Bank of America3.572%620Origination fee: varies
    Closing costs: 2% – 5%
    Santander Bank3.558%VariesAppraisal fee: varies
    Returned Payment Fee: $30
    Payment Collection Fee: $10 for online payments, $15 with customer service agent
    Rocket Mortgage2.875%580Origination fee: usually 0.5% to 1% of loan
    Third Federal Savings2.97%VariesClosing costs: $295-$595 for low cost loans
    Return check: $36
    Application fee: none
    Prepayment fee: none
    Raymond James Bank3.463%640Varies

    Best for member perks – SoFi

    While SoFi’s rates are on par with top mortgage refinance lenders, it can be slightly difficult to find specific information — call the lender for more information. Join the online mortgage lending revolution with SoFi — a lender that makes homeownership a social club

    J.D. Power Rating
    N/A
    Min. Credit
    660
    Min. Down Payment
    10%
    SimpleScore
    3.5 / 5.0
    close
    SimpleScore SoFi 3.5
    Perks 2
    Credit Impact 5
    Customer Satisfaction N/A
    Product Variety 3
    Fees 4

    If you’re a current member of SoFi, then getting a home loan with the online lender is extremely beneficial. Furthermore, SoFi gives some flexibility in conventional refinance loans terms, offering 30-, 20-, 15- and 10-year terms on mortgages. Its refinance rates are competitive, but the minimum credit score is slightly higher than what some homeowners may be able to achieve.

    Note: The lender information (Min. Credit Score and Min Down Payment) included refers to a conventional purchase loan. For more information on refinance loans, please visit the lender site.

    Best 15-Year Fixed APR – Bank of America

    All you need is a computer to get rolling with Bank of America’s refinancing. Competitive rates and low fees make Bank of America a strong pick for your mortgage refinance.

    J.D. Power Rating
    3/5
    Min. Credit
    620
    Min. Down Payment
    3%
    SimpleScore
    3.8 / 5.0
    close
    SimpleScore Bank of America 3.8
    Perks 5
    Credit Impact 3
    Customer Satisfaction 3
    Product Variety 4
    Fees 4

    Bank of America is one of the few lenders who actually give an estimated monthly payment for its refinancing options. It puts the lending terms into a format that borrowers can actually understand. When you refinance your 15-year fixed mortgage, you can also choose the cash-out option which can give you extra cash at closing to use for your more urgent needs.

    Note: The lender information (Min. Credit Score and Min Down Payment) included refers to a conventional purchase loan. For more information on refinance loans, please visit the lender site.

    Best 30-Year Fixed APR – Santander

    Santander Bank doesn’t have a large service area or online presence, but it offers rates that rival its larger competitors. Northeasterners will love the convenience of Santander and not for financing cars, but for refinancing homes, too.

    J.D. Power Rating
    3/5
    Min. Credit
    Not specified
    Min. Down Payment
    20%
    SimpleScore
    3.8 / 5.0
    close
    SimpleScore Santander 3.8
    Perks 5
    Credit Impact 5
    Customer Satisfaction 3
    Product Variety N/A
    Fees 2

    When you work with Santander, you have the option of refinancing your 30-year fixed loan with either zero points or three points. There’s the added bonus of the retail sector that allows you to meet with an actual loan specialist rather than the more informal online application. Santander is only available in 11 states and Washington, D.C., so while the refinance options are great, many homeowners won’t qualify. Note, however, that Santander charges varying appraisal fees, late payment fees and returned payment fees. If you’ve had trouble paying on time with your current mortgage, it might be best to not refinance with this bank.

    Note: The lender information (Min. Credit Score and Min Down Payment) included refers to a conventional purchase loan. For more information on refinance loans, please visit the lender site.

    Best for fast refinancing – Rocket Mortgage

    The mortgage rates for Rocket Mortgage are out-of-this-world, and you don’t need amazing credit to qualify. Rocket Mortgage has the power of Quicken Loans with some of the lowest rates available.

    J.D. Power Rating
    5/5
    Min. Credit
    620
    Min. Down Payment
    3%
    SimpleScore
    3.4 / 5.0
    close
    SimpleScore Rocket Mortgage 3.4
    Perks 4
    Credit Impact 4
    Customer Satisfaction 5
    Product Variety 3
    Fees 1

    Rocket Mortgage provides quick, easy service with full online access and low fees. The rates are among the most competitive, and Rocket Mortgage boasts the best customer service with a perfect score from J.D. Power. Backed by Quicken Loans, Rocket Mortgage has streamlined the mortgage origination and refinance process, most notably through a mobile app.

    Note: The lender information (Min. Credit Score and Min Down Payment) included refers to a conventional purchase loan. For more information on refinance loans, please visit the lender site.

    Best for minimal fees – Third Federal Savings & Loan

    Third Federal keeps it simple with one rate for its mortgage products, but it’s less forthcoming about eligibility requirements. Third Federal Savings is all about equal opportunity, giving one rate to all qualifying borrowers.

    J.D. Power Rating
    N/A
    Min. Credit
    Not specified
    Min. Down Payment
    Not specified
    SimpleScore
    4.5 / 5.0
    close
    SimpleScore Third Federal Savings & Loan 4.5
    Perks 5
    Credit Impact 4
    Customer Satisfaction N/A
    Product Variety 4
    Fees 5

    There’s a 60-day rate lock and where most companies charge fees for higher jumbo loans, Third Federal offers discounts instead. If you qualify for its Community Support Lending, you can benefit from zero closing costs and APRs about 2% lower than normal rates. Otherwise, closing fees are $295 if you opt for a Smart ARM or 10-year fixed refinance.

    Note: The lender information (Min. Credit Score and Min Down Payment) included refers to a conventional purchase loan. For more information on refinance loans, please visit the lender site.

    Best for flexibility – Raymond James Bank

    Choose your loan size and pick from seven different kinds of mortgage products for a perfectly customizable experience. Get personalized care with Raymond James for your mortgage refinance, but be prepared to work closely with your lender’s rep because there’s little for you online.

    J.D. Power Rating
    N/A
    Min. Credit
    640
    Min. Down Payment
    3% (varies based on loan type and down payment assistance)
    SimpleScore
    4.3 / 5.0
    close
    SimpleScore Raymond James Bank 4.3
    Perks 5
    Hard/Soft Pull to Credit 4
    Customer Satisfaction N/A
    Product Variety 5
    Fees 3

    Raymond James Bank is not only available in all 50 states, but it also has no minimum loan size requirement for a truly flexible, customizable experience. Despite its multiple products, though, you won’t find the application process online, so you will have to call for further details.

    Note: The lender information (Min. Credit Score and Min Down Payment) included refers to a conventional purchase loan. For more information on refinance loans, please visit the lender site.

    What is a mortgage refinance?

    A mortgage refinance is a powerful financial move that allows homeowners to replace their original mortgage loan with a new loan under new terms and new rates. A mortgage refinance company will offer homeowners new rates to decrease monthly payments and/or longer terms to extend the life of the loan. You can refinance with a new mortgage refinance company or stick with the current one if it’s beneficial.

    How mortgage refinancing works

    A home loan doesn’t last just a few months or years like a personal loan does; instead, it can last for 30 years and more. A lot can happen in so many years, and your needs will likely change. This is when mortgage refinancing can be an invaluable help to your household.

    When you refinance, the process is quite similar to your original home loan. There is plenty of documentation that will need to be submitted, and your credit score and payment history will be heavily weighted in the decision to grant you a new loan.

    While it may take some work to refinance your mortgage, there is a lot that can be gained from the process. This is not ideal for homeowners who intend to move or sell the home in the coming years, but if you are settled in your home and need to adjust your current financing, this could be the right solution for you.

    New rate

    When the novel coronavirus struck in early 2020, the world came to a standstill, and markets plunged in response. With such low rates, many homeowners jumped at the chance to take advantage of the incredible savings they could bring.

    It doesn’t take a global pandemic to bring beneficial mortgage rates, however. If you originally financed your home during a time when rates were very high, you could stand to save a lot of money by refinancing when market rates fall.

    New loan terms

    They don’t call it house-poor for no reason. When you first buy your home, it likely puts a real strain on your budget, but as the years pass, your economic situation can change. Not only can you benefit from a better rate, but sometimes, you can also benefit from better loan terms, too. You could stand to reduce the length of your loan, or you could change from an adjustable-rate mortgage to a fixed-rate that brings greater stability.

    When to refinance

    The market is not the only thing that can dictate when is a good time to refinance your home. Most homeowners will refinance when they stand to gain at least a 1% decrease in rates on their home loan, but if your refinance is based on need, you likely have personal circumstances that will not wait until the market fluctuates in your favor.

    Everyone’s situation is different, but it is always ideal if you can benefit from lower interest rates and better terms when you refinance your mortgage.

    How to choose the best mortgage refinance loan for you

    When you commit to any kind of loan, it is crucial that it is the right kind of loan for you and carries terms that you are able to meet.

    Here’s how to find the best place to refinance a mortgage

    1. Choose your mortgage refinance loan.
      There are many different types of mortgage loan products that you can use to refinance your home loan. Fixed-rate mortgages are available in different lengths, like 15 and 30 years, and there is also adjustable-rate refinancing. You should also consider refinancing options from the Federal Housing Administration, the Department of Agriculture and the Veterans Administration for military households.
    2. Compare interest rates.
      The loan terms for each lender can be very different and not only in the interest rate. You should also give consideration to the length of the loan to see if this is a realistic fit for your family’s needs.
    3. Don’t forget about the fees.
      The fees for your mortgage refinance can vary drastically from lender to lender. Even the best mortgage refinance companies have their own costs for things like origination fees, late fees, application fees and prepayment penalties if you pay your loan off early. Read the fine print and weigh these fees against the other costs associated with each loan to find the one that will work best for you.
    4. Consider the eligibility criteria.
      Some refinance providers have eligibility criteria like credit score or income requirements. Make sure you find out what the criteria are before applying — it doesn’t make sense to waste time on a lender if you know you’ll be denied.

    Mortgage FAQs

    When you apply for any kind of loan, one of the first things that a lender will do is pull your credit report. Before you apply for mortgage refinancing, you should pull a copy of your credit report so you can see what the lenders will see. If you have a lower credit score, you can save time and your credit score by moving to another refinance company rather than applying for a loan that you will not be approved for.

    As the U.S. continues to grapple with COVID-19, the markets continue to fluctuate in response. When the world shut down and the housing market plummeted, it presented a very lucrative opportunity for those who were able to leverage dropping interest rates against their existing home loans.

    As summer slowly brings the reopening of American businesses, current mortgage rates for 2020 are still much lower than we have seen in recent years. This presents a very lucrative opportunity for those households that managed to escape the claws of COVID-19 and are financially sound enough to refinance their mortgage.

    We welcome your feedback on this article and would love to hear about your experience with the mortgage refinance loans we recommend. Contact us at inquiries@thesimpledollar.com with comments or questions.

    Methodology

    SimpleScore

    We’ve created the SimpleScore to help you objectively compare products and services here at The Simple Dollar.

    Our editorial team:

    • Identifies five factors to compare across each brand
    • Determines the rating criteria for each factor
    • Calculate an average of those five factor scores to get one SimpleScore

    We break down each of these five factors and their rating criteria for our review of the best mortgage companies.

    Why do some brands have different SimpleScores on different pages?

    Some brands like Bank of America, Wells Fargo, and Chase have different SimpleScores because they offer more than one financial solution — like home loans, auto loans, personal loans and more.

    For instance, in our Bank of America Mortgage Review, we give the company a 3.8 out 5 based on our five rating factors for mortgages. In our Bank of America Auto Loans Review, we give the company a 4.4 out of 5 based on our rating factors for auto loans. By tailoring our SimpleScore to each financial solution, we’re able to give you a more accurate view of a brand’s services and how it compares to competitors’ services.

    Perks

    Mortgage lending companies that provide more perks receive a higher score from us.

    Hard/Soft credit checks

    We know that credit checks affect your score –– that’s why we favor companies that offer soft credit checks or hard credit checks when you want to see your pre-approval rates.

    Customer satisfaction

    We use the J.D. Power 2019 Mortgage Origination Satisfaction Study℠ to find out how customers rate their experience with each company. (If a company is not included in J.D. Power’s study, we skip this rating factor and average the remaining factor scores.)

    Product variety

    Mortgage lenders that offer more products for their home loans are given higher scores.

    Fees

    Fees can add up fast. Companies that don’t require as many fees for your home loan receive a higher score with us.

    Lena Borrelli

    Contributing Writer

    Lena Borrelli is a Tampa-based freelance writer who has worked with leading industry titans, such as Morgan Stanley, Wells Fargo, and Simon Corporation. Her work has most recently been published on sites like TIME, ADT, Fiscal Tiger, Bankrate and Home Advisor, as well as many other websites and blogs around the world.

    Reviewed by

    • Andrea Perez
      Andrea Perez

      Andrea Perez is an editor at The Simple Dollar specializing in personal finance. Prior to that she specialized in digital marketing content for online learning websites. She holds a master’s degree in journalism and media studies from the University of South Florida.