Sign up for our FREE Monthly Email Newsletter
In addition to keeping in the financial know, you may be interested in checking your credit score and report.
¹The credit scores provided under the offers described here use the Equifax Credit Score, which is a proprietary credit model developed by Equifax. The Equifax Credit Score and 3-Bureau scores are each based on the Equifax Credit Score model, but calculated using the information in your Equifax, Experian and TransUnion credit files. The Equifax Credit Score is intended for your own educational use. It is also commercially available to third parties along with numerous other credit scores and models in the marketplace. Please keep in mind third parties are likely to use a different score when evaluating your creditworthiness. Also, third parties will take into consideration items other than your credit score or information found in your credit file, such as your income.
²The Automatic Fraud Alert feature is made available to consumers by Equifax Information Services LLC and fulfilled on its behalf by Equifax Consumer Services LLC.
³Equifax Credit Report Control™ is only available while you have a current subscription to Equifax Complete Premier. Locking your credit file with Equifax Credit Report Control will prevent access to your Equifax credit file by certain third parties, such as credit grantors or other companies and agencies. Credit Report Control will not prevent access to your credit file at any other credit reporting agency, and will not prevent access to your Equifax credit file by companies like Equifax Personal Solutions which provide you with access to your credit report or credit score or monitor your credit file; Federal, state and local government agencies; companies reviewing your application for employment; companies that have a current account or relationship with you, and collection agencies acting on behalf of those whom you owe; for fraud detection and prevention purposes; and companies that wish to make pre-approved offers of credit or insurance to you. To opt out of such pre-approved offers, visit www.optoutprescreen.com/.
4We will require you to provide your payment information when you sign up and we will immediately charge your card $4.95. After that, we will charge the card $19.95 for each month you continue your subscription. You may cancel at any time; however, we do not provide partial month refunds.
Equifax® is a registered trademark and Equifax Complete™ Premier is a trademark of Equifax, Inc. © 2014, Equifax Inc., Atlanta, Georgia. All rights reserved.
Yes, in theory you can, but you have to figure out if you should. It depends largely on whether you have a prepayment penalty built into your mortgage contract, what you hope to gain out of the refinance, and how much money you will have to pay out in closing costs. If your main goal is to save money in interest, look at how long it will take you to recoup any closing costs. Typically you want to be able to pay these off within a year, so you should look for low closing costs or a large drop in your interest rate.
I want to take advantage of these low rates, but my credit is not ideal. When I took out my mortgage, I had a score above 700. However, due to a long bout of unemployment, I got behind on my bills, and my credit has dropped to below 650. Should I refinance?
You could try, but you may find that it’s not worth it. The super-low rates you see are set for prime borrowers—typically defined as people with credit scores above 720. Unless you qualify for that bracket, you’re not going to get the lowest rates anyway.
The real question is whether or not you can save money on a refinance. Depending on when you took your mortgage out and what rate you have, you may still be able to shave a percentage point or more off your current mortgage. Make sure to consult with your mortgage company or another mortgage broker to find out more. Also, if you’re shopping around for interest rates, remember to apply in rapid succession to avoid having too many hard inquiries on your credit report.
My home is underwater. Can I refinance?
Yes, you can, but unfortunately your options are limited because you don’t have any equity in your home. If you want to refinance now, your best bet is the government-backed Home Affordable Refinancing Program (HARP) 2.0, which allows homeowners who have less than 20 percent equity in their homes to refinance. There are several caveats to this program, however: Your mortgage must be owned or guaranteed by Freddie Mac or Fannie Mae, and it has to have been sold to them on or before May 31, 2009. In addition, the loan on your home must be for at least 80 percent of the home’s value, and you must have a good payment history for the last 12 months.
I have a second home that I am renting out right now. Can I refinance this home, even though it is not my primary residence?
Yes, you can, but it depends on how much equity you have in your second property. These days, lenders like to see 20 percent to 30 percent (or more) equity in rental or investment properties. If you have enough equity, mortgage lenders should be willing to work with you. Otherwise you may be facing an uphill battle.
I only have $48,000 left on my $350,000 mortgage, but I am still interested in refinancing. Can I do this?
In this scenario, you may be out of luck. Few lenders will refinance a loan that small because there’s simply not a lot of incentive for them to do it. Your best bet is to amp up your payments if you can and to pay it off as quickly as possible, which will cut down any remaining interest.
The bottom line on refinancing is that interest rates are at record-low levels right now and you should take advantage of them if possible. If you can’t currently qualify for a refinance, try to Increase your equity, pay more each month, and work on your creditworthiness. You might be able to qualify for a refinance soon—before rates rise.
Ilyce R. Glink is the author of several books, including 100 Questions Every First-Time Home Buyer Should Ask and Buy, Close, Move In!. She blogs about money and real estate at ThinkGlink.com and at the Home Equity blog for CBS MoneyWatch.
The information contained in this blog post is designed to generally educate and inform visitors to the Equifax Finance Blog. The blog posts do not give, and should not be assumed to provide, personalized tax, investment, real estate, legal, retirement, credit, personal financial, or other professional advice. Before making any financial decision, you should always consult with the appropriate professionals who can explain your options, rights, and legal responsibilities, and advise you on any tax, legal, credit, or business implications that may result from those decisions. The views and opinions expressed by the authors of blog posts are their own views and may not be the views or opinions of Equifax, Inc. and/or its affiliates.
Equifax maintains this interactive forum for education and information purposes in order to allow individuals to share their relevant knowledge and opinions with other members and visitors. We encourage you to participate in discussions about personal finance issues and other topics of interest to this community, but please read our commenting guidelines first. Equifax reserves the right to monitor postings to the forum and comments will be published at our discretion. Do you have questions or comments about your Equifax credit report or customer-service issues regarding an Equifax product? If so, please contact Equifax directly. All opinions and information expressed or shared in blog comments are solely those of the person submitting the comments, and don't necessarily represent the views of Equifax or its management.