A refinance pays off only when the monthly savings outrun your closing costs before you sell or refinance again, and checking your options does not have to cost you credit points. Duane Buziak, NMLS #1110647, is a soft pull mortgage broker who prices files across hundreds of wholesale lenders. The seven checks below are the ones he runs before a homeowner commits to anything. One clarification first: LowerMortgageRates is Duane Buziak Mortgage Maestro, and it is not Lower.com and has no affiliation with that company.
The credit piece is handled by the NoTouch Credit Pull, a soft credit pull mortgage pre-approval. A soft pull lets a broker see enough of your credit to price your file without recording a hard inquiry, the kind that appears on your report and can lower your score by a few points. That makes a mortgage pre approval without hard pull possible while you compare offers.
1. Calculate Your Break-Even Point
Suppose you owe $350,000 at 7.00% on a 30-year fixed loan. Principal and interest is $2,328.56 a month. Refinancing into a new 30-year loan at 6.25% drops it to $2,155.01, a saving of $173.55 a month. These numbers are an illustration, not a quote. If the refinance costs $6,500 to close, then $6,500 divided by $173.55 gives about 37.5 months. Stay in the home longer than that and the refinance pays; leave in year three and you have lost money.
Break-even is the month when your cumulative savings equal what you paid to close. It works because closing costs are paid up front while savings arrive in small monthly pieces, so time in the home decides the outcome. To find yours:
- Get a Loan Estimate, the standardized form the CFPB explains here, and total the closing costs.
- Subtract the new principal and interest payment from your current one.
- Divide total costs by the monthly saving.
- Compare the result with how many months you realistically expect to stay.
The common mistake is looking only at the rate drop. A new 30-year term restarts the clock. In the illustration above, paying the new loan for all 360 months means about $425,804 in interest. A borrower five years into the old loan who restarts at 30 years adds five more years of payments. If the higher payment is manageable, ask for a 25-year or 20-year term so the payoff date does not move.
Track two figures: break-even months against your planned years in the home, and total interest over the remaining term under each option.
2. Judge Whether the Rate Drop Is Big Enough
No single rate drop justifies a refinance, because the answer depends on your balance, your costs, and how long you will keep the loan. The familiar advice that you need a full 1% drop is a rule of thumb, and it fails in both directions.
Balance does most of the work. Take an illustration with a 0.375% drop, from 6.875% to 6.50%. On a $600,000 balance, the payment falls by about $149 a month. On a $150,000 balance, it falls by about $37. If both homeowners pay roughly $6,500 in closing costs, the larger loan breaks even in about 44 months and the smaller one takes about 174 months, close to 14.5 years. Same rate drop, opposite verdicts. In practice, some fees scale with loan size, but the gap remains large.
Duane Buziak recommends testing the decision with real quotes rather than a formula:
- Ask for pricing at several combinations, such as a higher rate with little to nothing out of pocket at closing, a middle rate, and a lower rate with discount points.
- Calculate the monthly saving for each against your current payment.
- Divide each option’s total costs by its saving to get its own break-even.
- Keep the option whose break-even sits comfortably inside your time horizon.
For context on where the market sits, check the weekly Freddie Mac Primary Mortgage Market Survey and note the date you read it. Those are national averages, so your own quote will differ with credit score, loan size, and property type.
Measure the monthly payment change and the break-even month for every quoted option, side by side. Do not rely on the rate alone.
3. Shop Without Hurting Your Credit
You can compare refinance offers without a hard inquiry by starting with a soft pull. The NoTouch Credit Pull is built for this: a soft-pull pre-approval that reads your credit for pricing purposes only, so a no hard inquiry mortgage pre approval can sit behind every quote you collect. Compare that with a standard hard pull, which is recorded on your report and is what most people fear when they think about rate shopping.
Suppose you want three offers. You run the soft pull once through a soft pull mortgage broker and review pricing from many wholesale sources. You pick the winner and authorize a hard pull only for that one. Your report shows a single hard inquiry instead of three. Because it is a no credit hit mortgage application at the comparison stage, you can keep looking as rates move. Expect the final underwriting step to need a full credit check before closing.
Putting it into practice:
- Ask every provider, in writing if you can, whether the pre-approval uses a soft pull or a hard pull.
- Request a quote or pre-approval that does not trigger a hard inquiry.
- Authorize a hard pull only once you have chosen a provider.
- If you must allow more than one, keep them inside a short window. Scoring models commonly treat mortgage inquiries within roughly 14 to 45 days, depending on the model, as a single inquiry. The CFPB’s mortgage shopping guidance encourages comparing multiple offers.
The classic mistake is letting several providers each pull your credit while you are still browsing. Some of those inquiries may fall outside the window, and each can nudge your score down slightly.
After shopping, pull your credit report and count the hard inquiries. The target is one, belonging to the provider you chose.
4. Check Your Equity and LTV
Your loan-to-value ratio, or LTV, is your loan balance divided by your home’s value, and it drives your pricing, your program options, and whether you pay private mortgage insurance (PMI). Lower LTV generally means better pricing and more choices.
Illustration: you owe $350,000 on a home you believe is worth $450,000. That is 350,000 divided by 450,000, or about 77.8% LTV, under the 80% line where conventional loans typically drop PMI. Now suppose the appraisal comes in at $430,000. The same balance is 81.4% LTV, just over the line, and your plan changes. The gap between estimate and appraisal is the entire risk.
LTV also caps what you can borrow if you take cash out. A conventional cash-out refinance goes up to 90% LTV. A VA cash-out refinance goes up to 100% LTV. Those are separate programs with separate limits, so confirm which one applies to you.
To work it out:
- Estimate your home’s value from recent comparable sales.
- Divide your current payoff balance by that value.
- Ask your broker which appraisal or waiver path applies to your file.
- Rerun the math with the confirmed value.
The common mistake is treating an online estimate as the appraised value. Automated estimates can miss renovations, condition, and local sales. Plan on your number being a range.
Track your LTV percentage against the 80% line, and against the program limit for any cash you want to take out.
5. Match the Refinance Program to Your Loan
The right refinance program depends on the loan you hold today, and each program has its own rules, documentation, and cost structure. The main options:
- FHA Streamline: for existing FHA loans, with reduced documentation and a net tangible benefit requirement. Check eligibility on HUD.gov.
- VA IRRRL: for existing VA loans, with reduced documentation and its own cost-recovery rules. Current terms are on the VA.gov IRRRL page.
- Conventional: follows Fannie Mae and Freddie Mac guidelines. The 2026 conforming limits from FHFA are $806,500 for most counties and $1,249,125 in high-cost areas.
- Non-QM: for borrowers whose income or credit profile does not fit standard guidelines, such as self-employed owners using bank statements, usually at different pricing.
Illustration: a veteran with an existing VA loan may qualify for an IRRRL with less paperwork than a full conventional refinance, subject to current VA rules. A homeowner with an FHA loan may find a streamline cheaper than moving to conventional, or may find that a conventional refinance with a drop in PMI is the better deal. The only way to know is to price the options.
Start by identifying your current loan type from your mortgage statement. Check the official program page, then ask Duane Buziak which programs apply to your file and what each requires.
The common mistake is assuming you must switch loan types, or that a streamline skips the net-benefit test. Streamlines are designed to reduce your cost or improve your terms, and the rules check for exactly that.
For each eligible program, compare the documentation required and the total cost to close, then take both into the break-even math from the first strategy.
6. Compare Total Costs on the Loan Estimate
Compare APR, points, and fees on the Loan Estimate, not the headline rate. The annual percentage rate (APR) folds many upfront costs into one yearly figure, so it is a better yardstick than the interest rate alone. Points are prepaid interest, with one point equal to 1% of the loan amount.
Illustration on $350,000: Quote A is 6.25% with 1 point, which costs $3,500 up front and carries a payment of $2,155.01. Quote B is 6.50% with no points and a payment of $2,212.24. Quote A saves $57.23 a month, so the $3,500 extra takes about 61 months to recover. If you expect to keep the loan five years or less, Quote B wins despite the higher rate.
A related misconception is that a “no-cost” refinance is free. The costs are folded into a higher rate or covered by a lender credit. The better phrase is no-out-of-pocket closing options, and the same break-even test applies.
How to compare cleanly:
- Collect Loan Estimates on the same day, with the same loan amount, term, credit score assumption, and lock period, because rates move daily.
- Line up Section A (origination charges), Section B (services you cannot shop for), and Section C (services you can shop for).
- Compare points and lender credits separately from the rate.
- Use Dare to Compare, Duane Buziak’s side-by-side check: you bring a competing Loan Estimate and it is lined up against pricing on the same assumptions.
The common mistake is comparing quotes with different point and credit structures, which makes a cheap quote look expensive, or the reverse. Record the APR and total closing costs for each quote, then the break-even on any points.
7. Decide Between a Broker and a Single Lender
A broker can price your refinance across hundreds of wholesale lenders, while a retail lender quotes from its own rate sheet. Duane Buziak works as the broker, so one file is compared against many wholesale sheets, and the quote you hold is the result of that comparison rather than a single lender’s menu.
The structural differences are easy to check:
| Factor | Duane Buziak (broker) | Rocket Mortgage | Movement Mortgage |
|---|---|---|---|
| Business model | Broker placing loans with wholesale lenders | Retail lender originating its own loans | Retail lender originating its own loans |
| Rate sheets priced | Hundreds of wholesale lenders | Its own pricing | Its own pricing |
| Soft-pull pre-approval | NoTouch Credit Pull | Confirm with provider before applying | Confirm with provider before applying |
| Competing quote review | Dare to Compare | Provides its own Loan Estimate | Provides its own Loan Estimate |
| Licensed states | VA, FL, TN, GA, DC, NC, SC, MD | Confirm for your state | Confirm for your state |
Before you pick, ask each provider how many rate sheets they can access, whether they offer a soft pull, and which programs they cover. Then count how many options each one actually priced for you.
A smaller mistake is assuming that any similar-sounding online name is the same company. Lower.com, for example, is a separate business, so confirm the name, the licensing, and the NMLS number before sharing documents. You can verify any individual or company through NMLS Consumer Access.
To judge the result, track the number of options priced and the spread between the highest and lowest quote on the same day.
Questions Homeowners Ask Before They Refinance
How do I know if refinancing my mortgage is worth it?
A refinance is worth it when your break-even point arrives well before you expect to sell or refinance again. Divide total closing costs by your monthly payment saving, and compare the answer with your planned time in the home.
What is a break-even point on a refinance?
It is the month when your accumulated savings equal your closing costs. In the illustration above, $6,500 in costs and $173.55 in monthly savings give a break-even of about 37.5 months.
Does checking refinance rates hurt my credit score?
Not when the check is a soft pull. Hard inquiries can lower a score slightly, but a soft credit pull mortgage review does not record one. Scoring models also commonly group mortgage inquiries made within a short window.
What is the NoTouch Credit Pull and how does it work?
It is a soft-pull pre-approval that lets Duane Buziak price your file without a hard inquiry. A standard hard pull is logged on your credit report, while this one is not, so you can compare offers first and authorize a hard pull only for the provider you choose.
Is LowerMortgageRates the same as Lower.com?
No. LowerMortgageRates is operated by Duane Buziak Mortgage Maestro and is not affiliated with Lower.com. Check any provider’s name and NMLS number on NMLS Consumer Access.
How much does it cost to refinance?
Closing costs commonly run from roughly 2% to 6% of the loan amount, depending on the loan, the property, and the state. Your Loan Estimate shows the exact figure, and Sections A, B, and C show where it comes from.
What are the 2026 conforming loan limits?
The FHFA 2026 baseline conforming limit is $806,500, and the ceiling in high-cost areas is $1,249,125. Loans above the applicable limit are generally priced as jumbo loans, which can change your options.
Is a no-cost refinance really free?
No. The costs are still paid, usually through a higher rate or a lender credit. A no-out-of-pocket closing option can make sense, but run the same break-even math on it.
How much equity do I need to refinance?
A common target is at least 20% equity, which means an LTV of 80% or lower, to avoid PMI on a conventional loan. Conventional cash-out refinances go up to 90% LTV, and VA cash-out refinances go up to 100% LTV.
How does a mortgage broker differ from a single retail lender on a refinance?
A broker prices your file across many wholesale lenders, while a retail lender quotes only from its own products. That usually gives you more options to compare, though the final saving depends on your credit, loan size, and program.
Run the Math, Take the Soft Pull, Then Compare Loan Estimates
Start with break-even, because it tells you quickly whether a refinance is worth pursuing at all. If the number works, run the NoTouch Credit Pull so you can gather quotes without a hard inquiry. Then line up same-day Loan Estimates and compare APR, points, and fees. Skip the rule-of-thumb shortcuts: a fixed 1% rule is the one most likely to steer you wrong.
Don’t let uncertainty about mortgage rates cost you thousands. Discover your personalized options with a trusted mortgage professional who can compare rates across hundreds of wholesale lenders without impacting your credit score. Schedule your free consultation today and take the first step toward securing the right mortgage solution for your unique financial goals.