Discover Mortgage Refinance Review

ByAshlyn JacksonAug. 20, 2020

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In a Nutshell

For a great loan experience, Discover’s Mortgage Refinance option has an excellent choice for your home refinance needs. With flexible loan options and zero cash at closing, Discover has exceptional incentives to make for a simple pain-free loan process.

pros

  • Fixed Monthly Payment
  • Terms Ranging from 10 to 30 Years
  • Zero Application, Origination or Appraisal Fees

cons

  • Loans from $35,000 to $200,000
  • DTI Ratio cannot exceed 43%
  • Penalty for payoff before 36 months

Discover at a Glance 

Loan types: Refinance and Home Equity 

Repayment terms: 10, 15,20 or 30 years

Minimum Down Payment: Varies depending on loan amount

Minimum Credit Score: 620

Best for: Homeowners looking to take advantage of a better interest rate, consolidate debt or make an improvement on their existing home. 

Overview

Discover Home Loans stands as a choice to be considered for homeowners with any home refinance goals and now there has never been a better time to take advantage of the incentives Discover offers. Whether you're looking to lower your interest rate or add a major upgrade to your home, Discover offers flexible options to meet your needs. For starters, the application process has been moved entirely over the phone or online, eliminating the hassle of in person meetings. The website also boasts about Discovers’ zero closing costs, zero application fee, and zero origination fee. All of this combined can prove to save customers thousands in the process. 

Best For?

Discover’s refinance option is best for those homeowners looking to refinance at a lower than average rate in order to reduce their month to month spending and their spending over the term of their loan. This option is also ideal for debt consolidation, or for those looking to make a large upgrade to their home but who might be short on funds. Homeowners needing less than $200,000 in financing and a decent credit score (at least 620) would benefit most from this refinancing offer. In addition, Discover also offers customer support 7 days a week and assigns you a personal banker to make the loan process as smooth as possible. 

Types of Loans/Products

Home owners can expect to have no cash due at closing, no origination fees and no application fee when completing their home refinance. Also, with its application being completely online, customers can submit documents, and finalize the submission all from the comfort of their home or office. Customers in need of additional support can easily find help 7 days a week from their personal banker, eliminating any unforeseen problems during the loan process

  • 620 credit required
  • Interest rates from 3.99% to 11.99% 
  • Loan Terms at 10, 15, 20 & 30 Years 
  • No Application Fee
  • No Origination Fee
  • No Cash to Close

The Application Process

Discover also makes your loan process simple and removes most of the headache that a traditional application carries. There are 5 steps from start to finish. You don't need much additional information besides your basic personal info which can be easily found from your drivers license, and social security. Apart from this, the info needed is mostly common knowledge such as marital status and income. Follow the prompts given during the application and if you run into any problems, your personal banker can assist in a timely manner. Here is the general process: 

  1. Enter your basic information (Loan amount and property address)
  2. Enter your personal information (Name and income)
  3. Enter Additional Information (DOB, Social Security Number)
  4. Credit Check
  5. You’re given your loan options

Rates and Fees– The Bare Basics 

Discover offers flexible loan options ranging from $35,000 to $200,000. Your interest rates can vary from 3.99% to 11.99% depending on your credit score, debt to income ratio and loan amount. Discover does mention that they prefer you have a 620 credit score, at least, and also a debt to income ratio of less than 43%. 

Apart from this, they offer flexible loan terms ranging from 10-30 years depending on your personal needs and won’t charge you any application fees to get started. Discover is also offering to cover it’s customers origination fees and all closing costs accrued from third parties during the closing period. 

Repayment Terms

Depending on the homeowners financing needs and repayment schedule, customers can choose between 10, 15, 20 or 30 year terms. This is coupled with an interest rate that can range from 3.99% and 11.99% depending on the credit score and credit history of the borrower. 

Help & Support

Discover prides themselves on their excellent customer support - So much so that they offer customers accessibility to support 7 days a week, plus assigns them a personal banker to assist with any dilemmas during the loan process. Customers can reach support at 1-866-219-0257 on Weekdays 8am‐Midnight ET and Weekends 10am‐6pm ET. As an alternative, customers can also check Discover’s FAQ page to find answers to the most commonly asked questions regarding the loan process. 

Summary

Discover offers an appealing deal in regards to their excellent refinance option for homeowners. Customers can count on a fast and easy application, complete with no application fee. There's also the added bonus of flexible loan terms and the possibility of a low interest rate starting at 3.99%. Additionally there is the ideal perk of no closing costs or origination fees for customers looking to save as much as possible. Bottom line, if you have a decent credit history with a score of 620 or above Discover is a perfect choice for your home refinance needs. 

FAQ

  • Does Discover Take Credit Score into consideration? Like all Mortgage lenders, a thorough evaluation of your credit history is taken into account to determine loan eligibility. That being said a DTI ratio of less than 43% and a credit score of at least 620 is suggested. 
  • Are There Any Fees with Discover Home Loans? There is no application fee, closing costs or origination fees. However if you pay off your loan within 36 months of financing you may be subject to an additional charge. 
  • How Much will Discover Allow me to Borrow? Each loan application is judged on a case by case basis dependent on a number of factors ranging from your home’s equity to your credit health. However Discover clearly states on their website that the max is $200,000. 
  • Does Discover Pay my Down Payment for me? Discover states that they will cover your application fees, origination fees and closing costs. They will not cover the down payment. 

Physical Address

PO Box 29029

Phoenix, AZ

85038-9029

Discover