A no-cost refinance is a trade: you accept a rate slightly above par, and the lender credit that comes with it pays your closing costs. The par rate is the zero-point rate for your profile. Sit a notch above it and the lender pays you a credit for accepting the higher rate, and that credit covers title, escrow, and the rest so nothing comes out of pocket. On any given day the best available rate almost always has some cost or some credit attached, rarely exactly zero. The extra interest is usually modest: often an eighth to a quarter percent above par generates enough credit to cover a typical set of closing costs, though it depends on the day's pricing. Jeb's own refinance is a clean example. He took a rate roughly an eighth above the market rate on a large (about seven-figure) loan, and the resulting lender credit, on the order of half a point, covered title, escrow, and the rest, so he paid nothing. Loan size explains why big loans do this more easily. The lender credit is a percentage of the loan amount, so it scales up with loan size, while closing costs (title, escrow, recording) are relatively fixed in dollars. On a large loan, a small rate bump throws off plenty of credit to swallow those fixed costs. On a small loan, the same bump generates far fewer dollars, so you would need a bigger rate premium to cover the same fees. All figures here are illustrative.