A few benchmark mortgage refinance rates have gone up today. The 15-year fixed and 30-year fixed refinancing saw their average rates rise. In addition, the average rate on 10-year fixed refinancing has also increased. Although refinancing rates are still changing, they have been lower than they have been in years. For those looking to get a good rate, now is the perfect time to refinance a home. Before you refinance, remember to consider your personal needs and financial situation, and research multiple lenders to find the right one for you.
30-year fixed rate refinancing
The 30-year average fixed refinance rate is currently 3.15%, an increase of 14 basis points from this period last week. (One basis point equals 0.01%.) Refinancing a 30-year fixed loan from a shorter loan term can lower your monthly payments. For this reason, refinancing over 30 years can be a good idea if you are having difficulty making your monthly payments. However, the interest rates for a 30-year refinance will generally be higher than the rates for a 10- or 15-year refinance. It will also take you longer to pay off your loan.
Refinancing at a fixed rate over 15 years
The 15-year average fixed refinance rate is currently 2.44%, an increase of 16 basis points from what we saw the week before. A 15-year fixed refinance will most likely increase your monthly payment compared to a 30-year loan. On the other hand, you will save money on interest, since you will be paying off the loan sooner. 15-year refinance rates are generally lower than 30-year refinance rates, which will help you save even more in the long run.
10-year fixed rate refinancing
The average 10-year fixed refinance rate is currently 2.38%, an increase of 13 basis points from what we saw the week before. A 10-year refinance will usually have the highest monthly payment of all the refinancing terms, but the lowest interest rate. 10-year refinancing can help you pay off your home much faster and save on interest. Just be sure to take a close look at your budget and current financial situation to make sure you can afford a higher monthly payment.
Where are the rates going
We track refinancing rate trends using information collected by Bankrate, which is owned by CNET’s parent company. Here is a table with the average refinance rates provided by lenders in the United States:
Average refinancing interest rates
|30-year fixed refi||3.15%||3.01%||+0.14|
|15-year fixed refi||2.44%||2.28%||+0.16|
|Refi fixed 10 years||2.38%||2.25%||+0.13|
Prices as of October 1, 2021.
How to Find Custom Refinance Rates
It is important to understand that the rates advertised online may not apply to you. Market conditions are not the only factor in interest rates; your particular request and your credit history will also play an important role.
Typically, you’ll need a high credit score, low credit usage rate, and a consistent, on-time payment history in order to get the best interest rates. You can usually get a good idea of average interest rates online, but be sure to speak to a mortgage advisor so you know the specific rates you qualify for. And don’t forget the fees and closing costs, which can get expensive up front.
You should also be aware that many lenders have had more stringent loan approval requirements in recent months. If you have a low credit score or a bad credit history, you might have a hard time refinancing at the lowest interest rates.
Before you apply for refinancing, you need to make your application as strong as possible in order to get the best rates available. The best way to improve your credit rating is to get your finances in order, use credit responsibly, and monitor your credit regularly. Also, be sure to compare offers from multiple lenders to get the best rate.
Is Now the Right Time to Refinance?
For refinancing to make sense, you will generally want to get an interest rate lower than your current rate. Besides interest rates, changing the term of your loan is another reason to refinance. Although interest rates have been low over the past few months, you should look more than market interest rates to decide if refinancing is right for you.
Refinancing may not always make financial sense. Consider your personal goals and your financial situation. How long do you plan to stay at home? Are you refinancing to lower your monthly payments, to pay off your home sooner, or for a combination of reasons? And don’t forget the fees and closing costs, which can add up.
Note that some lenders have tightened their requirements since the start of the pandemic. If you don’t have a strong credit score, you might not qualify for the best rate. Refinancing can be a good decision if you get a good rate or can pay off your loan sooner, but think carefully about whether it’s the right choice for you.