The Average Cost to Refinance

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From taking advantage of a lower monthly payment to ditching your FHA mortgage insurance, there are plenty of reasons why you might want to refinance. But how much should you expect to pay? Let’s take a look at the average cost of a refinance and what you might expect to pay for each of your closing costs.  

FeeAverage Cost
Application fee$200
Appraisal fee$500
Title insurance and search$900
Loan origination feeAbout 1% of your principal balance
Attorney fees$700
Total: $2,300 plus 1% of loan principal

Best Places to Refinance:

Refinance Fees Explained

Just like when you get a home loan, you’ll need to pay a variety of costs at closing when you refinance a mortgage. The specific costs you’ll pay and fees you’ll face will vary depending on your refinance options and where you live. As a general rule, you can expect to pay 2%–3% of the total value of your loan when you refinance.

Let’s take a look at some of the most common refinancing closing costs, the average cost of each item and what each fee covers. 

Application Fee

Before you receive a decision on your refinance, your lender will bill you for the cost of processing your application. The application fee usually covers the cost of a credit check and an underwriting analysis of the financial information you submit with your refinance. Some of the best refinance mortgage companies have eliminated the application fee, but most lenders still charge them in some capacity.

Expect to pay about $200 for your refinance application fee if your lender charges one. Keep in mind that this fee is due even if you aren’t approved for a refinance, so make sure you meet your new lender’s criteria before you apply. 

Appraisal Fee

An appraisal is a professional estimation of the amount of money your home is worth. During an appraisal, a home value expert called an appraiser will take a walk around your home, do some outside research and assign a value to your home.

Lenders require a new appraisal on most refinances. This is because they need to be sure that your home value hasn’t fallen since you bought your house. New appraisals are required on all forms of cash-out refinances.

Not every type of refinance requires an appraisal. If your lender requires you to get a new appraisal, you can expect to pay about $500 for this fee. 

Title insurance is a type of protection that safeguards both you and your lender from competing claims on the property you’re buying. During a title search, a title insurance company will research the history of the property to ensure that you don’t have any liens or claims on the property that will prevent the lender from seizing it if you default on your mortgage.

When you refinance with a new lender, you’ll usually need to pay for another title search and title insurance policy. The title search and insurance process typically cost a total of about $900. The good news is that, unlike other types of insurance, you don’t need to pay for title insurance every month — after you pay for it once at closing, you’re protected for as long as you have your loan. 

Loan Origination Fee

Your loan origination fee is typically the largest expense you’ll pay when you refinance your mortgage. The loan origination fee compensates your lender for drawing up the paperwork for your loan, calculating your interest rate and scheduling the inspections and appraisals you’ll need before you can close your refinance.

It’s impossible to put an exact dollar estimate on the loan origination fee because most lenders charge you a set percentage fee based on the value of your loan. As a general rule, expect to pay about 1% of the total value of your loan. For example, if you’re refinancing a $200,000 loan, you’ll typically pay around $2,000 in a loan origination fee.  

Attorney Fees

In some states, attorneys must review and approve loan paperwork before you can sign off on your refinance. They might need to review your loan agreement to make sure that it contains no illegal clauses and that your lender has correctly calculated your fees and interest rates. An attorney may also need to be present at the closing table to verify your refinance.

Attorneys’ fees can vary by state. Expect to pay about $700 in these fees if your refinance requires it. 

Best Mortgage Lenders for Refinancing

Now that you understand how much it costs to refinance, let’s take a look at some of the best places to refinance a mortgage loan.  

1. Best Overall: Quicken Loans®

If you’re looking for a fast and easy way to refinance nearly any type of mortgage loan, Quicken Loans will usually be the right choice for you. The company has streamlined the refinance process — you can now complete your application on your phone or tablet and receive a decision in minutes.

Quicken Loans specializes in providing a wide range of refinancing options. From FHA streamlines to jumbo cash-out refinances, its team does it all. With an easy-to-understand process and plenty of information available online, Quicken Loans is our first choice when it comes to the best refinance mortgage companies. 

2. Best for Veterans: Veterans United

If you have a VA loan, you might want to consider refinancing with Veterans United. Veterans United is the best mortgage company for veterans and anyone looking for a streamlined VA loan refinance. A streamlined refinance allows you to refinance your VA loan to a lower rate or longer term with less paperwork and without the cost of a new appraisal.

In addition to streamlined VA refinances, Veterans United also offers cash-out and standard VA refinances, as well as conventional loan solutions. Veterans United employs a full staff of former service members from all branches — you’ll know that you’re getting advice directly from men and women who have navigated the VA process themselves.

3. Best for Low-Interest Rates: better.com

Better Mortgage Corporation (better.com) is an online mortgage company that has streamlined the mortgage process, cut out the middleman and aims to pass the savings onto you. With better.com, you don’t need to worry about waiting days or even weeks to learn what interest rate you’ll pay on your new loan — just enter a bit of loan info, and you’ll instantly be able to see and compare rates using better.com’s intuitive quote system.

If you find a better insurance estimate somewhere else, better.com will match your new rate. This makes it one of the best refinance choices if you’re searching for the lowest APR possible on your new loan. 

4. Best for Low Credit Score Refinances: Keller Mortgage

You need to meet your new lender’s credit score standards when you apply for a new loan. If you have a conventional mortgage loan that you want to refinance into a new conventional loan, most mortgage companies will typically require you to have a score of 620 or above.

If you’re still working on building your score and you’re just missing this threshold, consider refinancing through Keller Mortgage. In our review, Keller Mortgage had lower credit score requirements when compared to other lenders. To refinance a conventional mortgage loan, you’ll only need a score of 600 points.  

5. Best for Fast Refinances: CloseYourOwnLoan.com

If you need money to pay down debt before it accrues more interest or if you’re struggling to make your monthly mortgage payments each month, you probably want to refinance your mortgage loan as quickly as possible. If your goal is to refinance fast, consider a refinance from CloseYourOwnLoan.com.

CloseYourOwnLoan.com (powered through Magnolia Bank) is a DIY mortgage refinance company offering online loans. You can refinance your mortgage in as little as 3 days when you work through CloseYourOwnLoan.com. Available in most states and able to service multiple types of loans, CloseYourOwnLoan.com is an innovative choice for borrowers looking to close quickly. 

6. Best for In-Person Service: Wells Fargo

Getting approved for an online mortgage refinance can be a simple and convenient solution for many homeowners. However, if you’re less technologically-inclined or you’d like the comfort of knowing that you have a person standing by to help you if you run into trouble, you might want to consider refinancing with Wells Fargo.

With over 8,000 branches across the U.S., Wells Fargo is one of the largest banks offering refinances in the country. No matter where you live, chances are that you’re close to a Wells Fargo branch. With Wells Fargo, you have the option to complete your entire refinance online, head into a local bank or begin your application online and finish it in-person. 

Refinancing the Right Way

Are you getting ready to refinance? The best way to lower your costs is to know and understand all of your loan options. Research a few different lenders and negotiate closing costs with your pick. You might be surprised at just how much leeway your lender might be able to extend to you when it comes to cost.  

Frequently Asked Questions

Q: How do I get pre-approved?

Q: How do I get pre-approved?

First, you need to fill out an application and submit it to the lender of your choice. For the application you need 2 previous years of tax returns including your W-2’s, your pay stub for past month, 2 months worth of bank statements and the lender will run your credit report. Once the application is submitted and processed it takes anywhere from 2-7 days to be approved or denied. Check out our top lenders and lock in your rate today!


Q: How much interest will I pay?

Q: How much interest will I pay?

Interest that you’ll pay is based on the interest rate that you received at the time of loan origination, how much you borrowed and the term of the loan. If you borrow $208,800 at 3.62% then over the course of a 30-year loan you will pay $133,793.14 in interest, assuming you make the monthly payment of $951.65. For a purchase mortgage rate get a quote here. If you are looking to refinance you can get started quickly here.


Q: How much should I save for a down payment?

Q: How much should I save for a down payment?

Most lenders will recommend that you save at least 20% of the cost of the home for a down payment. It is wise to save at least 20% because the more you put down, the lower your monthly payment will be and ultimately you will save on interest costs as well. In the event that you are unable to save 20% there are several home buyer programs and assistance, especially for first time buyers. Check out the lenders that specialize in making the home buying experience a breeze.



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1Based on Quicken Loans data in comparison to public data records.