When shopping for current mortgage refinance rates the first question that comes out of any borrowers mouth when talking to their mortgage lender is usually centered around the interest rate and how low it is. But what many people forget about is picking the right loan for their situation. By picking the right mortgage loan program potential borrowers can almost guarantee themselves the lowest interest rate possible that will benefit them more by also fitting into their short and long term financial goals.

Different options To Consider For Your Refinance

Adjustable Rate: While the vast majority of borrowers want a fixed rate loan there are borrowers that could benefit from the lower rates and payments of an adjustable rate mortgage. If you know you will refinance or sell your home within the loans pre adjustment period you can expect rates around a quarter to half a percentage point less then a fixed rate..

Pay Points: If you intend to stay in your home for many years it may make sense to pay points on your mortgage to get the lowest refinance rate. Points paid for a lower interest rate are normally tax deductible so along with the lower ate you also get tax savings at the end of the year. The average amount to pay for points is one to two percent of the total loan amount, or $10-$20 per $1000 borrowed.

No Closing Cost Refi: Although the rates on a no closing cost refi are higher then normal they do allow you to refinance almost for free. You will be responsible for pre paid items like interest and taxes but the rest of the fees are paid by the lender. These loans let people that know they will refinance again within a few years or sell their home keep more equity in their property by not using it to finance closing costs.

By using the right program to refinance your mortgage you will definitely set yourself to get the best loan for your goals and finances. On the other hand if you just focus on a low rate you may be passing up a program thats right for you.