Today, a number of benchmark mortgage refinance rates have gone up.
Both the 15-year fixed and the 30-year fixed saw their average rates increase. At the same time, average 10-year fixed refinancing rates also increased.
Refinance interest rates change constantly. However, they are currently very low. For those looking to refinance their existing mortgage, now may be the perfect time to get a record rate.
Here are the average rates for 30-year, 15-year and 10-year refinance loans:
Compare refinance rates for a wide range of different loans here.
Forecast of the 2021 refinancing rate
Refinance and mortgage rates could see ups and downs over the next few months. However, overall, most experts expect interest rates to rise in 2022. Strong economic conditions and rising inflation have contributed to this expected rate hike. Uncertainty surrounding the COVID-19 Omicron variant and the possibility of other coronavirus variants affecting the economy could offset the rate hike. So, even though most experts predict that higher rates will be the trend going forward, we probably won’t see consistent day-to-day or week-to-week gains.
What refinance rate trends mean for you
Even with incremental increases, refinance rates should remain incredibly favorable for borrowers, as they are among the lowest in the industry.
Cash-in refinances have become more common recently due to rapidly rising home values. Getting cash refinance can be a cost-effective way to pay off high-interest debt or make home improvements.
Depending on your personal financial situation, refinancing may or may not make financial sense. Over the long term, rates will likely continue to rise, so it’s worth comparing rates right now with a few lenders to see if you can save.
Pay attention to refinancing fees
For a new mortgage, you will have to pay an initial fee totaling 3% to 6% of the loan amount. If you are refinancing, this is a major expense to consider. Your monthly savings may not have exceeded the initial costs if you refinance too often or sell your home soon after refinancing.
30-year fixed refinancing rates
Currently, the average 30-year fixed refinance has an interest rate of 3.57%, an increase of 3 basis points from a week ago.
You can use our mortgage calculator to figure out the price of your monthly mortgage payments and how much less interest you’ll pay by making additional payments. Our Mortgage Calculator will also tell you how much interest you will be charged over the life of the loan.
15-year refi rate
Currently, the average rate on a 15-year fixed refinance loan is 2.90%, an increase of 8 basis points from a week ago.
Monthly payments on a 15-year refinance loan can be significantly higher than what you would get on a 30-year mortgage. However, a shorter loan term can help you build equity in your home much faster.
Average 10-year fixed refinancing rates
The average 10-year fixed refinance rate is 2.92%, an increase of 8 basis points from what we saw last week.
Monthly payments with a 10-year refinance term would cost even more than what you would pay on a 15-year loan. The upside is that you’ll end up paying even less interest over the life of the loan.
How we determine refinance rates
The chart below shows refinance rate trends over the past week.
These daily refinance rates are provided by Bankrate. The information is based on clients who fit a certain profile, such as the loan is for a primary residence and their FICO score is 740 or higher. You may therefore be eligible for different rates if your financial situation does not meet the survey criteria.
Bankrate is owned by Red Ventures, the parent company of Nextadvisor.
Rates as of January 19, 2022.
Take a look at mortgage refinance rates for a number of different loans.
Frequently asked questions (FAQ) about the refinance rate:
Should I refinance now?
Refinancing is not only about numbers, like the refinance rate, your situation is also an important factor. You’ll want to ask yourself if refinancing will help you achieve your goals
Generally speaking, refinancing makes sense if you can lower your interest rate by 1% or more. However, there are times when getting a lower interest rate isn’t the primary driver of the decision to refinance. As home values rise, many homeowners are choosing to turn their equity into cash through cash refinancing. Cash refinance loans usually have higher rates compared to other options, but it can be a good way to pay for home improvements or pay off other higher-interest debt.
As long as refinancing matches your financial goals and brings you closer to achieving them, now is the time to refinance.
How to make sure you get the lowest refi rate
Your finances have a big impact on the refinance rate you can get. Having a lower loan-to-value ratio for your home and a better credit rating usually results in a lower mortgage refinance rate.
Your personal finances aren’t the only factor that affects the refinance interest rate you qualify for. The equity you have in the property also comes into play. Having at least 20% equity in your property is ideal.
The type of mortgage affects your refinance rate. A shorter term refinance loan usually has better interest rates than a longer term loan. Also, if you want to get money out of your home with a cash refinance, you will be charged a higher interest rate, compared to other types of refinance.
How much does refinancing cost?
Several factors affect the cost of refinancing, including:
- Where you live
- Type of mortgage
- Your lender
- Loan Balance
- FICO score
- The equity you have in the home
Typically, refinance closing costs are 3% to 6% of the loan balance. The type of loan you refinance can impact its cost in different ways. Some government-backed refinance loans, like the FHA Streamline or the VA Interest Rate Reduction Refinance Loan (IRRRL) may not require an appraisal, but may come with high upfront fees to cover mortgage insurance. On the other hand, if you have sufficient equity, you can refinance into a conventional loan to eventually get rid of the mortgage insurance requirement.