Home equity
Home equity also is a factor that lenders take into account before approving your request for mortgage refinancing. With most lenders, you need to have at least 20% equity in your home in order to qualify for a mortgage refinance.
This rule, however, applies only to conventional lenders. If you have an FHA mortgage, Fannie Mae or Freddie Mac mortgage, or a USDA home loan, you can qualify to refinance even if you do not have any equity in your home.
