Rates have dropped to the lowest point in years — here are the best lenders for refinancing your mortgage

If you've been waiting for rates to drop to refinance a 8% mortgage, your time has come. Rates are now at their lowest since 2022.

The 30-year fixed-rate averaged 5.98% during the week ending Feb. 26, according to Freddie Mac's Primary Mortgage Market Survey. 

That's significantly lower than the rate from a year earlier, which was 6.76%, and nearly two points lower than when rates peaked at 7.79% in October 2023, according to Freddie Mac's historical data.

Buyers are taking note. As rates started trending downwards last month, mortgage applications spiked.

"The impacts are noticeable, as weekly purchase applications and refinance activity have jumped, underscoring the benefits for both buyers and current owners," Khater said. "It's clear that housing activity is improving and poised for a solid spring sales season." 

If you're looking to refinance your mortgage, here are three lenders that are known for their customer service records, availability and diverse offerings.

Best for speedy closing: Rocket Mortgage

If you want that lower rate as soon as possible, consider Rocket Mortgage.

Its average closing time for refinancing is 21 days — half the national average. Additionally, Rocket is known for its customer satisfaction, garnering top ratings from J.D. Power and the Better Business Bureau.

But Rocket's origination fees fall in line with the national average and the company is completely online, so it does not have physical locations.

Best for lowest rates: Better

Better is known for its comparatively lower rates.

It also lets you roll your lenders' fees into your loan, so you don't have to pay them upfront (make sure your lower rate is worth adding the lender fees to your loan). This could help you lower your rate even if you may not have the cash available to cover those fees.

But, like Rocket, it doesn't have physical locations, so you should use another lender if you're looking for an in-person experience.

Credit Unions are member-owned and run, meaning any money the credit union makes is put back into products for its members.

That means tend to have better rates compared to traditional lenders, and more flexible terms. PenFed Credit Union made our best refinance lenders list as the best credit union option.

Unlike many credit unions with strict membership requirements, anyone can join with a $5 deposit into a PenFed savings account. PenFed offers borrowers refinancing a closing credit of up to $1,500.

To get the best rate possible, you'll want a strong credit score and low debt-to-income ratio. While requirements vary across lenders, here are some of the general guidelines for the minimum qualifications a borrower must meet to refinance.

Correction: An earlier version of this article mischaracterized Rocket Mortgage's origination fees. The fees are in line with those charged by other providers.

At CNBC Select, our mission is to deliver high-quality service journalism and comprehensive consumer advice to our readers, enabling them to make informed financial decisions. Every mortgage review is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of financial products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties and we pride ourselves on our journalistic standards and ethics.

CNBC Select reviews mortgage products using a variety of criteria, including average rates, terms, availability, fees, types of loans offered, online experience and customer satisfaction. 

Additionally, we incorporate findings from independent sources, including lender scores from the J.D. Power mortgage origination and servicing surveys and ratings from the Better Business Bureau.

For home equity loans, we review rates, repayment terms, the amount of equity required and the minimum and maximum loan amounts available.

We also consider requirements for credit scores, debt-to-income ratios and combined loan-to-value ratios.

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