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The rate on a 30-year fixed refinance declined to 6.94% today, according to the Mortgage Research Center. The average rate on a 15-year mortgage refinance is 5.96%. On a 20-year mortgage refinance, the average rate is 6.83%.
Related: Compare Current Refinance Rates
30-Year Fixed Refinance Interest Rates
The average rate for a 30-year fixed-rate mortgage refinance is 6.94%, down 0.11 point from a week ago.
On a 30-year fixed mortgage refi, the APR (annual percentage rate) is 6.98%, lower than last week’s 7.09%. APR, or annual percentage rate, includes a loan’s interest rate and a loan’s finance charges. It’s the all-in cost of your loan.
According to the Forbes Advisor mortgage calculator, borrowers with a 30-year fixed-rate mortgage refi of $100,000 will pay $662 per month in principal and interest (not accounting for taxes and fees) at today’s interest rate of 6.94%. You’d pay about $138,156 in total interest over the life of the loan.
20-Year Refi Rates
For a 20-year fixed refinance mortgage, the average interest rate is currently 6.83%, compared to 6.93% last week.
The APR, or annual percentage rate, on a 20-year fixed mortgage is 6.87%. It was 6.98% last week.
At today’s interest rate, a 20-year, fixed-rate mortgage refinance of $100,000 would cost $765 per month in principal and interest – not including taxes and fees. That would equal about $83,559 in total interest over the life of the loan.
15-Year Fixed Refinance Rates
The average interest rate on the 15-year fixed refinance mortgage is 5.96%. Last week, the 15-year fixed-rate mortgage was at 6.03%.
On a 15-year fixed refinance, the annual percentage rate is 6.01%. Last week, it was 6.09%.
At today’s interest rate, a 15-year fixed-rate mortgage would cost approximately $841 per month in principal and interest per $100,000 borrowed. You would pay around $51,467 in total interest over the life of the loan.
30-Year Jumbo Refinance Interest Rates
The average interest rate for a 30-year, fixed-rate jumbo mortgage refinance (a loan above the federal conforming loan limit of $806,500 in most places) declined week-over-week to 7.21%, versus 7.31% last week.
At today’s interest rate on a 30-year, fixed-rate jumbo mortgage refinance, a borrower would pay $679 per month in principal and interest on a $100,000 loan.
15-Year Jumbo Refinance Rates
A 15-year, fixed-rate jumbo mortgage refinance has an average interest rate of 6.37%, down 0.03 point from last week.
At today’s rate, a borrower would pay $864 per month in principal and interest per $100,000 borrowed for a 15-year, fixed-rate jumbo refi. Over the life of the loan, that borrower would pay around $55,496 in total interest.
Are Refinance Rates and Mortgage Rates the Same?
Mortgage lenders charge different interest rates for purchase and refinance loans. Current refinance rates are typically 0.01% to 0.15% higher for a 30-year fixed rate versus a purchase loan.
You can reduce your interest rate by paying your closing costs up front instead of rolling them into the loan with a no-closing-cost refinance loan. Buying discount points and avoiding mortgage insurance can also help.
Know When To Refinance Your Home
Refinancing your mortgage can be a wise move for many reasons, most notably lowering your interest rate or your monthly payments. It can also help you pay down your mortgage sooner, access your home’s equity or get rid of private mortgage insurance (PMI).
But there are closing costs associated with refinancing, so it probably makes more sense to refinance if you know you’ll be keeping your home for some time. You can determine the “break-even point” for a potential refinance, or how long it will take for savings from a new mortgage to surpass any closing costs. Find out what those costs will be and divide them by the monthly savings you’ll realize with the new mortgage.
The Forbes Advisor mortgage refinance calculator can help you run the numbers to see if it’s a good time for you to refinance.
Is Now a Good Time To Refinance?
Now may be a good time to refinance if you can reduce your monthly payment by getting a better interest rate or adjusting your repayment period.
While refinance rates are at multi-year highs, you may qualify for a competitive rate if your credit has improved since getting your existing mortgage or by switching to a shorter loan term, such as a 15-year mortgage. Refinancing from a government-backed loan to a conventional loan with at least 20% equity helps you waive private mortgage insurance, FHA mortgage insurance premiums or the USDA guarantee fees.
There are multiple mortgage refinance options to consider and some that let you tap your home equity.
Consider avoiding refinancing if you can’t get a better rate or reduce your monthly payment. Additionally, you will need to pay closing costs and the application process can be lengthy. These hindrances may exceed the potential benefits of refinancing.
How To Qualify for Today’s Best Refinance Rates
Refinancing a mortgage isn’t that different than taking out a mortgage in the first place, and it’s always smart to have a strategy for finding the lowest rate possible. Here are some suggested approaches to get the best rate:
- Polish up your credit score
- Lower your debt-to-income ratio
- Keep an eye on mortgage rates
- Consider a shorter loan
Having a strong credit score is one of the best things you can do to get approved and get a lower rate. You’re also likely to look better to lenders if you don’t have too much debt relative to your income. You should keep a regular watch on mortgage rates, which fluctuate often. Also see if you can manage a mortgage payment for a shorter loan term since they usually have lower interest rates.
Frequently Asked Questions (FAQs)
How much does it cost to refinance a mortgage?
Closing costs for a refinance can be anywhere from 2% to 6% of the cost of the loan. It’s always a good idea to ask the lender what kind of closing costs they’ll charge before you decide to borrow from them.
How quickly can you refinance a mortgage?
Many lenders refinance your mortgage in about 45 to 60 days, but it depends on the type of mortgage you choose and other factors. Ask your lender what their time frame is before you borrow to make sure its right for you.
How soon can you refinance a mortgage?
In many cases, you can refinance a mortgage as soon as six months after you start paying it down, although some lenders insist that you wait 12 months. You should ask your lender to be sure.