RefiNow vs RefiPossible: Mortgage Refinance Comparison
Refinancing your mortgage is a smart way to reduce your monthly payments, lower your interest rate, or even pay off your home faster.
Two popular refinance programs—RefiNow and RefiPossible—have been designed to make this process more accessible to homeowners with income less than 100% of the AMI (Area Median Income).
Both programs, backed by Fannie Mae and Freddie Mac, offer unique advantages for borrowers who may not qualify for traditional refinancing options.
Let’s dive into the details of each program, explore their benefits, and help you decide which refinance option suits your needs.
Plus, if you're ready to start your refinancing journey, Rate’s Mortgage Refinance can help you find the perfect solution to meet your financial goals—get started today!
What Is RefiNow?
RefiNow is a refinance program introduced by Fannie Mae to help low-to-moderate income homeowners refinance their mortgage loan with ease. Fannie Mae designates low income as individuals earning less than 50% of the area median income.
This program is particularly beneficial for borrowers who don’t have high credit scores or a lower debt-to-income ratio (DTI).
The Fannie Mae RefiNow program simplifies the process, making it easier for those who may have been unable to take advantage of lower interest rates.
By focusing on primary residence homeowners with existing mortgages through Fannie Mae, RefiNow provides relief through lower monthly mortgage payments and potentially shorter loan terms.
How Does RefiNow Work?
RefiNow streamlines the refinance loan process for homeowners. It’s designed to help those who might struggle with traditional requirements like income thresholds or high credit scores.
You’ll work with your lender to qualify for the program and take advantage of potential interest rate reductions.
What are the Eligibility Requirements for the RefiNow Program?
Homeowners must meet specific eligibility requirements to qualify for RefiNow. Your income must be at or below 100% of the area median income (AMI), and you should have a current mortgage owned by Fannie Mae.
Your credit score must be at least 620, and you’ll need to demonstrate good payment history.
How Is RefiNow Different From Traditional Refinancing?
RefiNow offers a much more accessible route for lower-income borrowers than traditional refinancing programs.
Unlike standard refinancing options, it features lower income and DTI requirements, making it possible for a broader range of homeowners to benefit from lower mortgage rates.
What Are the Benefits of the RefiNow Refinance Program?
RefiNow offers a variety of benefits that make refinancing within reach for some homeowners struggling to meet traditional criteria.
Lower Monthly Payments
One of the main attractions of RefiNow is the opportunity to reduce your monthly mortgage payment. By refinancing to a lower interest rate, borrowers can save more each month, freeing up money for other financial needs.
Simplified Application Process
The RefiNow program simplifies the application process by needing fewer documents. Borrowers can enjoy a faster, more streamlined experience when applying for a new loan.
Potential to Shorten Loan Term
RefiNow gives borrowers the option to shorten their loan term, allowing them to pay off their mortgage loan faster and build equity quicker. This can be an excellent choice for those looking to own their home outright sooner.
What is RefiPossible?
RefiPossible is another refinance option, offered by Freddie Mac, aimed at helping homeowners lower their mortgage payments.
Similar to RefiNow, it’s tailored for borrowers who may struggle with traditional refinancing requirements.
RefiPossible provides access to lower mortgage rates and offers relief for homeowners dealing with financial hardships.
If your current income is below certain thresholds and your existing loan is owned by Freddie Mac, you may qualify for this program.
How Does RefiPossible Work?
RefiPossible works by offering eligible borrowers a chance to refinance their current mortgage and reduce their monthly payments.
The program focuses on homeowners who are looking for a straightforward way to improve their financial situation without jumping through the hoops of traditional refinancing.
Who Qualifies for RefiPossible?
To qualify for RefiPossible, your loan must be through Freddie Mac, and the amount must be under the limits set by FHFA. Additionally, your income needs to be at or below 100% of the area median income.
Your credit score should be in good standing, and you need to have a solid payment history on your existing mortgage.
What Are the Benefits of RefiPossible?
RefiPossible offers several advantages that make it a valuable option for borrowers looking to save money and simplify the refinance process.
Simpler Qualification Process for Freddie Mac Loans
One of the standout features of RefiPossible is its lenient qualification requirements. Borrowers who may not qualify for other refinance programs can take advantage of this option due to its broader eligibility requirements.
Appraisal Credits
Unlike traditional refinancing options, RefiPossible has an appraisal credit that can be used when an appraisal is offered which can save borrowers money during the refinancing process.*
Helps Lower Mortgage Interest Rates
Homeowners could secure lower interest rates through RefiPossible, reducing their monthly mortgage payment and making homeownership more affordable.
Potential to Build Equity Faster
RefiPossible enables borrowers to reduce their loan term, helping them build equity faster and pay off their home loan sooner.
How Can I Qualify for RefiNow or RefiPossible?
Qualifying for RefiNow or RefiPossible requires meeting specific guidelines set by Fannie Mae or Freddie Mac.
These programs are tailored to help lower-income borrowers who might not meet the stringent requirements of traditional refinancing options.
Income Requirements for RefiNow and RefiPossible
To qualify for RefiNow or RefiPossible, your income must be at or below 100% of the area median income (AMI). If you’re unsure of your eligibility, you can check the AMI in your area through the Fannie Mae Loan Lookup Tool or the Freddie Mac Loan Look-Up Tool.
Credit Score Requirements for RefiNow and RefiPossible
The RefiNow program requires borrowers to have a credit score of at least 620. Maintaining a good payment history on your current mortgage is also essential to qualify.
Additionally, if you have mortgage insurance on your loan, it may carry over to the new mortgage loan.
Credit Score Requirements for RefiPossible
The Freddie Mac Refi Possible program requires borrowers to have a credit score of at least 620. Maintaining a good payment history on your current mortgage is also essential to qualify.
Property Eligibility
Both programs are designed for single-family homes and require that the property be your primary residence. You’ll have the option and can verify your property’s eligibility using the Freddie Mac Loan Look-Up Tool or Fannie Mae resources.
Documentation Needed
You’ll need to gather necessary documentation like income statements, details of your existing loan, and proof of eligibility requirement for the refinance process.
Simplifying Your Search with Mortgage Loan Lookup Tools
Before applying for RefiNow or RefiPossible, it's essential to determine whether Fannie Mae or Freddie Mac owns your current loan. Using the right mortgage loan lookup tool simplifies the process and ensures eligibility.
What is a Mortgage Loan Lookup Tool?
A mortgage loan lookup tool helps you verify if your mortgage is owned by Fannie Mae or Freddie Mac. This is a critical step in determining your eligibility for either the RefiNow or RefiPossible programs.
How to Use the Freddie Mac and Fannie Mae Lookup Tools
By entering your address and other personal details into the Fannie Mae or Freddie Mac mortgage loan lookup tools, you can easily determine your eligibility. The process is quick and ensures you're applying for the correct program.
Why FHA Loans Are Not Eligible for RefiNow or RefiPossible
FHA loans are governed by different rules than those set by Fannie Mae and Freddie Mac, which disqualifies them from RefiNow and RefiPossible.
Instead, FHA loans have their own refinancing options that follow distinct eligibility requirements. Therefore, it’s crucial to check your loan type before applying for any program to avoid confusion and explore the right solutions.
How can I Apply for a Mortgage Refinance?
Rate’s Mortgage Refinance options are tailored to help you secure lower monthly payments or shorten your loan term, all with reduced upfront costs.
Our intuitive app makes it easy to track your mortgage payments and manage your refinance journey from start to finish. With Rate’s fast, streamlined process, applying for a refinance has never been easier.
Start today and explore how Rate’s mortgage refinance can help you achieve your financial goals.
By refinancing, you may pay more in costs and interest over the extended term.
Guaranteed Rate, Inc. is a private corporation organized under the laws of the State of Delaware. It has no affiliation with the US Department of Housing and Urban Development, the US Department of Veterans Affairs, the US Department of Agriculture, or any other government agency.
*Savings, if any, vary based on the consumer’s credit profile, interest rate availability, and other factors. Contact Rate, Inc. for current rates. Restrictions apply.