Can I Still Refinance My Mortgage during COVID-19? | Axos Bank

Can I Still Refinance During COVID-19?


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Everyday life has changed dramatically with the pandemic. We’ve been advised to stay home, wear a mask, wash your hands, work remotely, and observe social distancing. Some of us may be wondering if there is anything that hasn’t changed during this unprecedented time in history. There is one common rule that still holds firm — when interest rates are at historic lows, many homeowners can benefit from refinancing.

With adequate income and good credit, you may still be able to take advantage of low interest rates by refinancing your mortgage — even during the COVID-19 crisis. A lower interest rate could reduce your current expenses and potentially help you reap long-term benefits.

What has changed?

In addition to the dramatic increase in refinance volume many lenders are experiencing, there have been other notable changes in the mortgage market over the past few months. When shopping for your next refinance, you may encounter changes, including:

  • Higher credit score requirements, with 700 now being a common minimum for many lenders
  • Above-market interest rates by some lenders meant to limit the number of refinances
  • Verification of a borrower’s employment the day of closing instead of 10 days before
  • Tighter restrictions on jumbo and super jumbo mortgage products
  • The financial documents submitted valid for 60 days instead of 120 days
  • Additional revenue, expense, and income information requested from self-employed borrowers

These changes are not universal for every lender. When you speak with a lender, it can be helpful to review their specific requirements before committing to a refinance. As with many things, it pays to shop around to find a lender who can offer the options you need.

What are some possible roadblocks?

There are some obstacles unique to the COVID-19 pandemic that may add some steps to the refinancing process.

Temporary Forbearance

When a borrower negotiates with their lender to temporarily lower their monthly mortgage payment or even pause their payments, the arrangement is called forbearance. It is an option provided under the federal CARES Act to assist homeowners dealing with hardships such as unemployment or the inability to work due to the COVID-19 crisis. If this is your circumstance as a homeowner, it may be appropriate to wait to refinance until your forbearance ends and three on-time payments are made.

Changes to Income

Consistent income is always a requirement to qualify for a mortgage, and the pandemic offers no exception. If you have lost your job, have been furloughed, or have experienced a decrease in income, it may be appropriate to wait until you have returned to work or your income has stabilized before applying for a new home loan.

Decreased Property Value

Like income and good credit, the equity you have in your home is important when considering a refinance. Significant decreases in home values during the pandemic have not been reported, but property values can vary by location. It’s helpful to check your property value before talking to lenders.

Life is definitely different during this pandemic. However, many homeowners still have the opportunity to secure a lower interest rate — a decision that could improve their immediate situation and solidify their future financial goals.

Because the requirements of lenders vary, it’s wise to shop around when looking to refinance your mortgage.

Axos Bank is here to help. We are offering all of our standard products — conforming, non-conforming, government, jumbo, and portfolio loans. Our customers are benefiting from rate-and-term, cash-out, and streamline refinances. If you want to explore your options and find solutions that meet your specific financial needs, call 888-546-2634 to talk with an experienced Mortgage Specialist. Or visit to learn more.

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Can I Still Refinance During COVID-19?