Home refinance interest rates vary from lender to lender. It is important to research all of the options before making the decision to refinance. Refinance rates could be lower than the interest rate on a current mortgage if say the current mortgage was taken out when the rates were higher over all. Refinance should never be higher than the rate on the original loan.
What is an Interest Rate
An interest rate is what a lender charges you to borrow money. Banks and other financial institutions borrow money from the federal government at a prime rate, they then charge consumers a rate of interest that can range anywhere from several points to many points above the prime rate that they have to pay. It is how banks and other financial institution make money. Refinance Rates are a hot topic because of the sub prime mortgage fiasco.
What Determines Home Refinance Interest Rates
Simply put credit worthiness plays the biggest role in what kind of interest rate a consumer will be able to secure. If the credit is good than the interest rate would be lower than say if the credit comes back a little questionable. There are other variables that determine home refinance interest rates. House refinance interest rates are the same rates that are posted for new mortgages, and vary from lender to lender. Typically refinance rates are least expensive with commercial banks which are traditional lenders. Non traditional lenders are going to have higher home refinance rates.
Home refinance interest rates can play a big roll in how much money can be saved over the life of the loan and all options should be considered.