Refinance Your Home Loan

When comparing home loans between credit unions and traditional banks, you’ll often find that credit union mortgage rates tend to be more competitive. Credit unions tend to offer lower interest rates on mortgage loan products compared to conventional banks, helping members save money over the life of their loans.

When comparing credit unions vs. banks, you’ll notice that their philosophy, structure and approach to banking are different. Because credit unions are not-for-profit institutions, you’ll enjoy member-focused lending, competitive refinance rates, lower fees and flexible options. If you’re considering switching banks, consider a credit union to refinance your home loan.

While having a good credit score is important, credit unions often take a more flexible approach to lending than traditional institutions. Most lenders prefer to see scores around 700, but credit union home loans may be available to borrowers with lower scores through special programs.

If you’re working on improving your creditworthiness, consider financial counseling or learning how to build good credit before applying. Many credit unions offer guidance on creating a budget and how to save money to help strengthen your financial position.

Your monthly credit union mortgage payment depends on several key factors:

• Loan amount: This is the total amount you’re borrowing from the credit union, which is typically your home’s purchase price minus your down payment.
• Interest rate: This percentage determines how much you’ll pay to borrow the money, and it can vary based on your credit score, market conditions and loan type.
• Loan term: This is the length of time you have to repay the loan, commonly 15 or 30 years. Longer terms typically result in lower monthly mortgage payments but more interest paid over time.
• Down payment: The amount you pay upfront reduces your loan amount and monthly payments, with larger down payments typically resulting in better interest rates.
• Private mortgage insurance (PMI): This is an additional monthly cost required when your down payment is less than 20% of the home’s value, protecting the lender if you default on the loan.
• Property taxes: These annual taxes are often divided into monthly payments and held in an escrow account, with the amount varying based on your location and property value.
• Homeowners insurance: This required insurance protects your property against damage or loss and, like property taxes, is typically divided into monthly payments and held in escrow.
• Loan type: Whether you choose a fixed-rate, adjustable-rate, FHA or another type of loan will affect your interest rate and overall monthly payment structure.

Your payment is directly affected by your mortgage rate. Lower rates mean lower payments, while higher rates increase your monthly cost. To get a clear picture of your potential payments, try our mortgage payment calculator. You can also compare different term lengths using our 15 vs. 30-year mortgage calculator to find the best fit for your budget.

Credit unions can offer competitive mortgage loan rates thanks to their unique structure as member-owned, not-for-profit organizations. Unlike traditional banks that focus on maximizing profits for shareholders, credit unions prioritize their members’ financial well-being. This community-focused approach to lending, combined with lower operating costs and less aggressive profit margins, allows credit unions to pass savings directly to members through better rates.  Learn more about how to get a mortgage to enjoy the benefits of a credit union.

Credit unions offer various mortgage options to meet different needs:

• Fixed-rate loans: With these loans, your interest rate stays the same, providing predictable monthly payments.
• Adjustable rate mortgage (ARM) loans: With these mortgage loans, interest rates may change periodically based on market conditions, potentially starting lower than fixed-rate options.
• VA loans: These are available to veterans and eligible service members and often require no down payment.
• FHA loans: These are government-backed loans with more flexible credit requirements. Use our FHA loan calculator to explore payment options.

If you’re considering refinancing your current mortgage, credit unions can help you evaluate whether it’s the right choice for your situation.

Choosing between a fixed-rate and an adjustable-rate mortgage depends on your financial situation and how long you plan to stay in your home. Unlike adjustable-rate mortgages (ARMs), which may have interest rates that change over time, fixed-rate mortgages lock in your rate for the life of the loan, ensuring your monthly principal and interest payments remain the same.

• When to choose a fixed-rate mortgage: Fixed-rate mortgages offer the security of a locked-in interest rate and consistent monthly payments for the life of your loan. This may be ideal for homebuyers who plan to stay in their home long-term and want predictable payments.
• When to choose an adjustable-rate mortgage: An adjustable-rate mortgage tends to feature a lower, fixed interest rate, along with a lower monthly payment, for an introductory period. The most common periods are terms of three, five, seven or ten years. Generally, this initial fixed rate is lower than that of a standard fixed-rate mortgage, allowing you to potentially save money during the introductory period. After the introductory period, the rate adjusts periodically based on market conditions. This rate can go up or down, potentially altering your monthly payment. 

Our home financing process begins with pre-qualification, where we assess your financial situation and help you determine how much you can afford. Next, you’ll complete a loan application and provide required documentation. Once approved, we’ll guide you through selecting the best financing option for your needs and support you through closing.

In most cases, refinancing your mortgage with a credit union takes between 30 and 45 days to complete. However, timelines can vary depending on your loan type, appraisal requirements and documentation. If you submit complete financial information early in the process, you may experience faster approvals and closing.

Yes, many homeowners refinance through the same credit union that holds their current mortgage. If you’re a California Credit Union member, you can easily refinance your current mortgage and enjoy a simpler process to get the rates or terms you’re looking for.

There is no legal limit on how often you can refinance your mortgage, but some lenders may require waiting periods between loans. Many homeowners typically refinance when interest rates drop, their credit improves or they want new loan terms, lower monthly payments or to access home equity.

Most lenders require homeowners to maintain at least 20% in home equity after a cash-out refinance, though requirements can vary by loan program and credit profile. This means your total new loan amount cannot exceed 80% of your home’s current appraised value. The amount you can borrow depends on your home’s value, existing mortgage balance, income and overall financial qualifications.