The No. 1 Reason Homeowners Refuse to Refinance

Woman contemplating refinance
Photo by Antonio Guillem / Shutterstock.com

Around 19 million homeowners could save money on their mortgages by refinancing — but many fail to do so because “they’re not sure it’s worth it,” according to a recent survey.

A YouGov survey for Forbes Advisor found that 34% of survey respondents cited that reason for not refinancing. Forbes believes “borrower burnout” may be behind such reticence:

“As loans get older and borrowers have more exposure to lower rates, (homeowners) are increasingly confronted with chances to refinance. So even though rates are scraping near record lows, those seasoned borrowers don’t want to go through refinancing again.”

Clifford Rossi, an executive-in-residence and professor of the practice at the Robert H. Smith School of Business at the University of Maryland, tells Forbes that many borrowers simply don’t want to endure the paperwork and other hassles surrounding refinancing, even if they would save money.

The coronavirus pandemic is adding to the potential for refinancing headaches. During these tough times, millions of homeowners have asked for mortgage forbearance. This — combined with a large number of new mortgage requests in a red-hot housing market — has put pressure on mortgage lenders struggling to keep up with demand.

The result is that homeowners who try to refinance often face “stalled applications, poor communication between lenders and borrowers, and even misinformation,” according to Forbes.

Homeowners also are reluctant to refinance because they fear paying high fees, a factor cited by 16% of respondents in the survey.

Other reasons why people are reluctant to refinance now include:

  • Having already refinanced recently: 23%
  • Low credit score: 7%
  • Refinancing is too much work: 7%
  • Too busy to refinance: 5%

Why you should consider a mortgage refinance

Despite such concerns, a mortgage refinance can be a great deal right now. Mortgage rates continue to hover near all-time lows, so homeowner savings can be substantial.

If you are a homeowner, it’s likely wise to at least shop around to see what is available. To get started, check out our story “6 Tips for Refinancing Your Mortgage During the Pandemic.”

If you decide refinancing is right for you, continue your education process by reading “How to Refinance Your Home Loan.”

Then, stop by Money Talks News’ Solutions Center and search for the best rates on a mortgage refinance.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
9 Items Under $25 That Will Keep Your House Clean
9 Items Under $25 That Will Keep Your House Clean

We’ve rounded up some of the best products for cleaning your bathroom, kitchen and every other room.

How to Avoid Being Surprised by 7 Nasty Expenses
How to Avoid Being Surprised by 7 Nasty Expenses

Major expenses are difficult to predict, but there are ways to make sure you’re protected.

15 of the Most Outrageously Overpriced Products
15 of the Most Outrageously Overpriced Products

Retailers mark up products by hundreds of times their cost — but you don’t have to pay the premium.

8 Reasons Your Parents Had an Easier Retirement Than You Will
8 Reasons Your Parents Had an Easier Retirement Than You Will

Here’s why the last decades of life are harder now than they used to be.

8 Common and Costly Homebuying Myths
8 Common and Costly Homebuying Myths

Think you’re ready to buy a house? Don’t fall victim to these rookie mistakes.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
9 Mistakes Everyone Makes When Shopping on Amazon
9 Mistakes Everyone Makes When Shopping on Amazon

Are you losing money due to any of these missteps?

7 Changes Coming to Social Security and Medicare in 2021
7 Changes Coming to Social Security and Medicare in 2021

Recently, both Social Security and Medicare made some major announcements about benefits for 2021.

Can a Divorced Widow Claim Her First Husband’s Social Security Benefits?
Can a Divorced Widow Claim Her First Husband’s Social Security Benefits?

The rules are complicated when it comes to eligibility for survivors benefits.

Can a Twice-Divorced Woman Claim Social Security Survivors Benefits?
Can a Twice-Divorced Woman Claim Social Security Survivors Benefits?

Understanding survivors benefits rules is the key to getting the most from your benefit.

These Are the 10 Worst Cars for Depreciation
These Are the 10 Worst Cars for Depreciation

Two types of vehicles are especially likely to see steep plunges in value.

9 Things You’ll Never See at Costco Again
9 Things You’ll Never See at Costco Again

The warehouse store offers an enormous selection, but these products aren’t coming back.

10 Things I Always Buy at Trader Joe’s
10 Things I Always Buy at Trader Joe’s

From snacks to sweets to side dishes, stock your cart with these time-tested favorites on your next TJ’s run.

Longer Trips to This Type of Store May Raise Coronavirus Risk
Longer Trips to This Type of Store May Raise Coronavirus Risk

An airborne-disease expert recommends exiting these stores within 30 minutes.

5 Ways Social Security Will Change in 2021
5 Ways Social Security Will Change in 2021

These adjustments will affect both workers and retirees in the new year.

11 ‘Disposable’ Items You Should Be Reusing
8 Things You Should Buy at Restaurant Supply Stores
8 Things You Should Buy at Restaurant Supply Stores

You don’t have to be a chef or a restaurant owner to shop here.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

19 High-Paying Jobs You Can Get With a 2-Year Degree
19 High-Paying Jobs You Can Get With a 2-Year Degree

There are easy high-paying majors available in the U.S. — and no bachelor’s degree is required. We’re here to help you find easy degrees that pay well.

Stop Buying These 19 Things Online
Stop Buying These 19 Things Online

The internet has changed how we shop. But for some things, you’re still better off buying the old-fashioned way.

Cut These 11 Expenses Now If You Hope to Retire Early
Cut These 11 Expenses Now If You Hope to Retire Early

Like the idea of financial independence? Part of the FIRE equation is cutting costs.

27 Things You Should Never Pay For — and How to Get Them for Free
27 Things You Should Never Pay For — and How to Get Them for Free

When you know the tricks, you can save big on all kinds of useful things that others pay for.

4 Tax Credits That Will Be More Generous in 2021
4 Tax Credits That Will Be More Generous in 2021

If you are eligible for these tax breaks, they will slash your federal income tax bill — dollar for dollar.

7 Tips for Building an Emergency Food Supply
7 Tips for Building an Emergency Food Supply

A pandemic or natural disaster could leave you reliant on your existing emergency food supply. Is your pantry well-prepared for emergencies? Knowing what to stock up on for emergencies can be a difficult task and we’re here to help.

15 Things You Can Get for Free in December
15 Things You Can Get for Free in December

December is here, which means it’s your last chance to take advantage of fabulous freebies in 2020.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.