COVID-19 has changed much about the world. The financial world has seen impacts just like the medical world, and mortgage rates are at historic lows as a result. If you’ve been considering a refinance, now is an excellent time to move forward with that plan, but there are a few things you should know first.

1. Credit and Income Requirements Are More Stringent

First, even though rates are at historic lows, lenders are more choosy about who they choose to lend. You will need solid income proof and a healthy credit score to successfully refinance in the current climate. However, if you have these things, then you can get a great rate on your new home loan right now.

2. Not All Lenders Are the Same

While rates tend to stay fairly consistent, they can vary some from one lender to the next. Though rates can vary, it’s the fees that can have the most significant impact from one lender to another. Do some homework to find the right lender for your needs as you seek to refinance. Sometimes higher fees will offset a potentially lower rate, so know all of the costs.

3. Be Prepared for Unusual Closings

The pandemic has created a culture where social distancing is the norm. Lenders are finding creative ways to meet with their clients to get loan documentation signed. It is possible for families who need to be protected against the virus to close on a refinance with socially distanced, masked, or virtual appointments to go over paperwork. Always check with an attorney to see what is legal in your state for these transactions, but with a little bit of creativity, you can refinance safely even in light of the pandemic.

4. Make Sure Refinancing Fits Your Financial Plan

Seeing historically low rates can make it feel like refinancing is necessary, but it’s not the right financial move for every homeowner. When you refinance, you will still pay closing costs on your new loan, and it can take a few years to recoup those costs with the interest savings on a new loan. Consider how long you will be staying in your home and whether or not you can recoup your closing costs. Do not make an emotional decision just because of the low rates, but do refinance if it makes financial sense.

If a refinance has been on your mind, the pandemic has created an ideal world to do so in, but make sure you’re making smart decisions. Consider the costs, both in the short term and the long term, and only move forward if you stand to gain financially with the refinance. If you do, take advantage of these historic lows and enjoy the perks of a new, more affordable mortgage.

Refinancing your current mortgage loan could result in the total finance charge being higher over the life of the loan.


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This is not a commitment to lend. Terms and conditions of programs, products and services are subject to change. All loans are subject to credit approval and property appraisal. Certain restrictions may apply on all programs. First Home Mortgage Corporation of America, First Home Mortgage Services, and First Home Mortgage Company of Maryland are d/b/a’s of First Home Mortgage Corporation. First Home Mortgage Corporation is licensed in Connecticut, Delaware, District of Columbia, Florida, Georgia Residential Mortgage Licensee (Lic. #23135), Indiana, Kentucky, Maine, Maryland, Massachusetts Mortgage Lender and Broker (Lic. #MC71603), Michigan, New Hampshire, Licensed by the New Jersey Department of Banking and Insurance, North Carolina, Pennsylvania, Rhode Island Licensed Lender and Broker, South Carolina, Tennessee, Vermont, Virginia, West Virginia. Equal Housing Lender. First Home Mortgage Corporation NMLS ID #71603 ( Privacy Policy.