Take my current home loan for instance – I owe about $235K. Let’s just compare a new 30 year fixed loan: one at 6.375% (my current rate) and one at 4.75%. At 6.375%, my monthly payments would be approximately $1466.86, assuming I didn’t have any points added to my loan for processing, paperwork, etc. At 4.75%, my monthly payments would be approximately $1225.87 – a savings of $240.99 per month. Over the course of a year, I’d be saving $2,891.88.

If refinancing is an option for you, take advantage of the low rates now! These 4% interest rates for home loans won’t last forever. Just hope that you’re not stuck in my situation of not being able to refinance – My refinance was denied!

Since the time of this writing, interest rates have shot up a bit to the 5% range. Still not too bad, especially if your current loan is in the mid 6% and above range. Best of luck to those of you who are looking to refi or get a new home loan.

Prior to going to a lender, it’s often a good idea to do your own credit report so that if there are any bad marks on it, you’ll be aware of them, and you may even be able to start amending them prior to securing a home loan.

The difference in pre-qualification and pre-approval is that a lender can guesstimate the amount of the loan you’ll be able to recieve based on income, debt, etc. and no credit report is necessary with pre-qualification, and with pre-approval, the lender will have to take an in depth look at your credit report to determine exactly the amount that you will be able to secure in a loan.