Several mortgage refinance rates rose today. Average rates for both 15- and 30-year fixed refinances increased, while 10-year fixed refinance rates remained unchanged. While refinance rates are dynamic, they are currently lower than they’ve been in years. That means now could be an optimal time to lock in a low rate. Before refinancing, we recommend reviewing your finances and goals, and always shopping around to find the right refinance loan for you.
Read more: Here’s how to decide if you should refinance
30-year fixed-rate refinance
The average rate for a 30-year fixed refinance loan is currently 3.07%, an increase of 8 basis points over this time last week. (A basis point is equivalent to 0.01%.) Refinancing to a 30-year fixed loan from a shorter loan term can lower your monthly payments. If you’re having difficulties making your monthly payments, a 30-year refinance could be a good option for you. However, interest rates for a 30-year refinance will typically be higher than rates for a 10- or 15-year refinance. It’ll also take you longer to pay off your loan.
15-year fixed-rate refinance
For 15-year fixed refinances, the average rate is currently at 2.37%, an increase of 7 basis points over last week. Refinancing to a 15-year fixed loan from a 30-year fixed loan will likely raise your monthly payment. However, you’ll also be able to pay off your loan quicker, saving you money over the life of the loan. Fifteen-year refinance rates are typically lower than 30-year refinance rates, which will help you save even more in the long run.
10-year fixed-rate refinance
The average rate for a 10-year fixed refinance loan is currently 2.33%, unmoved over last week. Compared to a 15- or 30-year refinance, a 10-year refinance will usually have a lower interest rate but a higher monthly payment. A 10-year refinance can be a good deal, since paying off your house sooner will help you save on interest in the long run. Just be sure to carefully consider your budget and current financial situation to make sure that you can afford a higher monthly payment.
Where rates are headed
We track refinance rate trends using information collected by Bankrate, which is owned by CNET’s parent company. Here’s a table with the average refinance rates supplied by lenders across the US:
Average refinance interest rates
|Product||Rate||A week ago||Change|
|30-year fixed refi||3.07%||2.99%||+0.08|
|15-year fixed refi||2.37%||2.30%||+0.07|
|10-year fixed refi||2.33%||2.33%||N/C|
Rates as of Sept. 3, 2021.
How to shop for refinance rates
When searching for refinance rates online, it’s important to remember that your specific financial situation will influence the rate you’re offered. Though current market conditions will be a factor, your particular interest rate will depend largely on your application and credit history.
Generally, you’ll want a high credit score, a low credit utilization ratio and a history of making consistent and on-time payments in order to get the best interest rates. Researching interest rates online is always a good idea, but you’ll need to connect with a mortgage professional to get your exact refinance rate. You should also take into account any fees and closing costs that might offset the potential savings of a refinance.
You should also know that many lenders have had stricter requirements when it comes to approving loans in the past few months. This means that if you don’t have great credit ratings, you might not be able to take advantage of lowered interest rates — or qualify for a refinance in the first place.
Before applying for a refinance, you should make your application as strong as possible in order to get the best rates available. The best way to improve your credit ratings is to get your finances in order, use credit responsibly and monitor your credit regularly. Don’t forget to speak with multiple lenders and shop around to find the best rate.
Is now a good time to refinance?
Generally, it’s a good idea to refinance if you can get a lower interest rate than your current interest rate, or if you need to change your loan term. While interest rates have been low in the past few months, you should look at more than just the market interest rates when deciding if a refinance is right for you.
Make sure to consider your goals and financial situation, including how long you plan to stay in your current home. It’s helpful to have a specific goal for a refinance, such as decreasing your monthly payment or adjusting the term of your loan. Also keep in mind that closing costs and other fees may require an upfront investment.
Some lenders have tightened their requirements in recent months, so you may not be able to get a refinance at the posted interest rates — or even a refinance at all — if you don’t meet their standards. Refinancing at a lower interest rate can save you money in the long run and help you pay off your loan sooner. But a careful cost-benefit analysis is necessary to confirm that doing so makes sense.