Written by Duane Buziak, NMLS #1110647
Refinance and purchase rates are priced differently, and the gap depends on your loan type, equity, and how you use the property. This guide gives Henrico County homeowners and buyers a repeatable way to compare the two, using a soft pull mortgage inquiry so your score stays untouched. Duane Buziak is a mortgage broker based in Glen Allen who has been helping Henrico families find their new homes since 2014. Before you start, have a rough home value, your current loan balance and rate (if you are refinancing), and a general sense of your credit range.
Step 1: Decide Which Two Rates You Are Actually Comparing
“Refinance rate” covers two products. A rate-and-term refinance changes your rate, your term, or both, without taking cash out. A cash-out refinance replaces your loan with a larger one and hands you the difference. Each is priced differently against a purchase loan, so choose one before you compare anything.
Next, fix the occupancy. A primary-residence purchase in Short Pump and a refinance on a rental near Innsbrook are not comparable, because investment properties carry higher pricing in either direction. Compare a primary residence to a primary residence, or a rental to a rental.
The mistake to avoid is setting a purchase quote with 20% down beside a cash-out refinance at 80% loan-to-value and blaming the transaction type for the difference. Part of that gap comes from your equity position and the loan’s risk profile, not from “refinance” versus “purchase” as a label.
Most readers here are Segment B: first-time or general Henrico buyers weighing a purchase against refinancing a first home they already own. Choose the pairing that matches your real decision. If you own in Glen Allen and are deciding between refinancing and moving, compare a rate-and-term refinance to a purchase of the next home.
Aside for Wyndham, Twin Hickory, and River Road homeowners: if you are considering cash-out to fund a renovation, your honest comparison is a cash-out refinance against a rate-and-term refinance plus a separate financing option. Those loan sizes can sit near or above conforming limits, which the next step covers.
Step 2: Gather the Same Inputs for Both Scenarios
Pricing moves on a short list of inputs. Write these down once and use them for both scenarios:
- Credit score range (for example, 700 to 739)
- Loan-to-value (LTV), meaning loan amount divided by home value
- Loan program: conventional, FHA, VA, or USDA where the property qualifies
- Property type (single-family, condo, townhome) and occupancy
- Whether discount points are included, and the lock period
Run both scenarios on identical inputs so the only variable is purchase versus refinance. Quotes with different points or lock periods are the most common reason two rates look different when they are not. A lower rate that includes two points is not comparable to a higher rate with none.
Loan size matters too. For 2026, FHFA set the baseline conforming loan limit at $832,750, with a ceiling of $1,249,125 in the highest-cost areas, per its 2026 conforming loan limit announcement. Henrico County has generally fallen under the baseline, but confirm the figure for your county in FHFA’s table, because loans above the limit are priced on a different basis. This matters for larger homes around Short Pump and Wyndham.
Equity limits also differ by program. Under the guidelines Duane Buziak works with, a conventional cash-out refinance caps at 90% LTV, while a VA cash-out refinance can reach 100% LTV. The same house can therefore produce different rates and different program options depending on the route you take.
Step 3: Pull a National Benchmark, Then Localize It
Start with Freddie Mac’s weekly Primary Mortgage Market Survey. Then open the CFPB’s rate check tool to see typical ranges by credit score and loan size. Read both pages live. Rates change daily, so any number copied into an article, a message, or a spreadsheet is stale quickly, and you should always note the “as of” date beside what you record.
Know what the benchmark is. It is a national average of 30-year fixed conforming rates for borrowers with strong profiles. It is not a Henrico quote, and it is not a refinance-specific number, so do not read it as either. It tells you the direction of the market, not your price.
Local variation comes from three places:
- Loan size: a $300,000 balance in Lakeside and a $750,000 balance in Short Pump price differently.
- Credit profile: the same market can show a wide spread between score tiers.
- Wholesale shelf: the wholesale lender that prices your file affects the final number, and a benchmark cannot capture that.
Use the benchmark as a sanity check. If a quote lands far from the range the CFPB tool shows for your credit and loan size, ask what is driving the difference: points, loan type, or occupancy.
Step 4: Understand Why Refinance and Purchase Rates Differ
The most useful fact is this: cash-out refinances typically price higher than rate-and-term refinances, while rate-and-term refinances and purchase loans are often close for similar borrower profiles. That varies by day and by shelf, so treat it as a pattern, not a promise. The pricing difference is largely driven by loan-level price adjustments (LLPAs), risk-based fees that depend on credit score, LTV, and transaction type, published in Fannie Mae’s LLPA matrix.
| Feature | Purchase Loan | Refinance (Rate-and-Term / Cash-Out) | Why It Matters |
|---|---|---|---|
| Typical pricing | Baseline for your credit and LTV | Rate-and-term often close to purchase; cash-out often priced higher due to LLPAs | The gap you see is usually cash-out risk pricing, not “refinance” itself |
| Maximum LTV | Program dependent (down payment sets it) | Conventional cash-out up to 90%; VA cash-out up to 100% | Higher LTV generally means higher pricing and fewer program choices |
| Appraisal and equity | Appraisal protects the purchase price | Appraisal usually needed; some streamline programs may waive it | Your equity, not the label, decides which options you have |
| Typical timeline | Driven by contract date and closing date | Includes appraisal, title, and a rescission period on primary residences | Plan lock length around the real timeline |
| Credit check method | NoTouch Credit Pull soft pull with Duane Buziak | NoTouch Credit Pull soft pull with Duane Buziak; some providers use a hard pull to quote | A soft pull lets you compare without a score impact |
Two program-specific refinance options are worth knowing, and you should verify current rules before relying on them. The VA Interest Rate Reduction Refinance Loan (IRRRL) is designed to lower the rate on an existing VA loan. FHA streamline refinancing, described in HUD’s Single Family Housing Policy Handbook, offers reduced documentation for existing FHA borrowers who meet its benefit requirements.
One mistake to avoid: assuming a lower refinance rate guarantees savings. Closing costs and a reset loan term can erase the benefit, which Step 6 quantifies.
Step 5: Get Both Quotes Side by Side With a Soft Pull
Duane Buziak runs a mortgage pre-approval without hard pull using NoTouch Credit Pull. That is a no hard inquiry mortgage pre-approval, so your score is not affected while you compare purchase and refinance scenarios on the same day. Call 804-212-8663 with the inputs from Step 2.
On the credit question people ask most: a soft pull does not hurt your score. The CFPB explains how to compare loan offers and how mortgage shopping fits into your credit picture. Credit scoring models generally treat multiple mortgage inquiries within a short window as a single shopping event, but the exact window varies by scoring model, so confirm the details before you collect hard-pull quotes elsewhere. A soft pull sidesteps the question entirely.
Broker independence is the structural point. Duane Buziak is a broker with access to hundreds of wholesale lenders, so one application can show how several shelves price the purchase and the refinance. A provider that works from a single rate sheet can show you only that sheet. Neither approach is wrong, but only one lets you see spread across shelves from one credit check.
Then use the Dare to Compare step. Bring any written quote you already have and ask Duane Buziak to match its inputs line by line: points, lock period, loan amount, loan program, and occupancy. When every input matches, the comparison is verifiable and the difference you see is real.
Step 6: Run the Math Before You Choose
The figures below are hypothetical illustrations, not quotes and not current rates.
Example 1: what a half-point pricing gap costs
Suppose a Glen Allen or Lakeside homeowner is weighing a $400,000 30-year fixed loan at two rates. At 6.25%, principal and interest is $2,462.87 per month. At 6.75%, it is $2,594.39. The half-point gap costs $131.52 per month, or about $47,347 over 360 months ($131.52 × 360). That is what a purchase versus cash-out pricing difference can mean in dollars.
Example 2: refinance breakeven
Now imagine refinancing a $400,000 balance from 7.00% ($2,661.21 per month) to 6.25% ($2,462.87). The monthly savings are $198.34. With $5,500 in closing costs, breakeven is about 27.7 months ($5,500 ÷ $198.34).
Decision rules:
- Compare breakeven to how long you plan to stay. If you expect to remain in your Tuckahoe or Deep Run Park-area home well beyond 28 months, this scenario pays off. If you may move in two years, it likely does not.
- A new 30-year term restarts your amortization and can increase total interest even when the payment falls. Ask about a shorter term or keeping your remaining years.
- Ask whether no-out-of-pocket closing options exist for your scenario, and compare them on total cost, not just cash due at closing.
On timing, ask about lock length and float-down options. Refinances and purchases run on different clocks: a primary-residence refinance includes appraisal, title work, and a three-business-day right of rescission, described in CFPB Regulation Z, section 1026.23, before funds are released. Purchases follow your contract’s closing date. Verify the details for your loan.
Frequently Asked Questions About Refinance and Purchase Rates in Henrico County
Are refinance rates higher than purchase rates?
Not necessarily. Rate-and-term refinance pricing is often close to purchase pricing for similar borrowers, while cash-out is often higher. It varies by day, shelf, credit, and LTV, so compare live quotes with identical inputs rather than relying on a general rule.
Are cash-out refinance rates higher than rate-and-term rates?
Typically yes. Cash-out loans carry risk-based loan-level price adjustments tied to LTV and credit, which usually raise pricing. The size of the difference changes with the market and the wholesale shelf, so ask for both scenarios side by side.
Does checking both rates hurt my credit?
Not with a soft pull. Duane Buziak’s NoTouch Credit Pull lets you compare purchase and refinance scenarios without a hard inquiry. Hard-pull quotes from other providers may register on your report, so ask how a quote is run before you agree to it.
What is a soft pull mortgage pre-approval?
It is a mortgage pre-approval without hard pull: a credit review that does not appear as a hard inquiry or lower your score. It gives you a working picture of your options and pricing, though it is not a loan approval or commitment to lend.
How much equity do I need to refinance in Henrico?
It depends on the program. A conventional cash-out refinance caps at 90% LTV, so you keep at least 10% equity, and a VA cash-out can reach 100% LTV. Rate-and-term and streamline options have their own requirements, so confirm yours with a quote.
Is a VA cash-out refinance different from a conventional one?
Yes. A VA cash-out can reach 100% LTV for eligible borrowers, while conventional cash-out caps at 90%. Pricing, fees, and eligibility also differ. Duane Buziak can price both so you see the tradeoffs on your own numbers.
How does a broker compare rates across shelves?
A broker submits your scenario to multiple wholesale lenders and reviews how each prices it. Duane Buziak has access to hundreds of wholesale lenders, so one soft-pull application can reveal differences that a single rate sheet would hide for both purchase and refinance.
How quickly can I get comparison quotes?
Often the same day once you provide your inputs: rough home value, current balance and rate, credit range, and loan goal. Call 804-212-8663. Rates change daily, so quotes are tied to the date and lock terms you receive.
Take Your Same-Input Quotes to a Henrico Broker Who Can Run Both
Before you move forward, confirm three things: both quotes use identical inputs, your breakeven fits the time you will stay in the home, and you are working from live rates rather than a national benchmark. If those hold, you have a comparison you can trust.
Your dream home in Henrico County is closer than you think. Discover exactly what you can afford with our credit-safe pre-qualification process that protects your score while unlocking your options. Get pre-qualified today and take the first step toward homeownership with a local mortgage expert who understands your community. You can also call Henrico Mortgage by Duane Buziak at 804-212-8663 for a NoTouch Credit Pull comparison, and verify licensing at NMLS Consumer Access.