Current Mortgage Refinance Rates, November 20, 2020 | Rates Decline

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Today a few notable refinance rates dropped off.

Both 15-year fixed and 30-year fixed refinances saw their average rates decrease. In addition, the average rate on 10-year fixed refinance remained unaltered.

Mortgage refinance rates are constantly fluctuating. However, they are exceptionally low right now. For those looking to refinance their existing mortgage, this might be the right move to lock in a great deal on an interest rate.

Take a look at local refinance rates.

30-Year Fixed Refinance Rates

Right now, the average 30-year fixed refinance has an interest rate of 3.00%, a decrease of 10 basis points what we saw last week. Just last month a 30-year fixed refinance had a smaller average rate of 1.00%.

You can use our mortgage calculator to get an idea of what your monthly payments will be and find out how much less interest you’ll pay by making additional payments. Our mortgage calculator will also show you how much interest you’ll be charged over the entire loan term.

15-Year Fixed-Rate Refinance

Currently, the average rate for a 15-year fixed refinance loan is 2.54%, a decrease of 3 basis point from what we saw last week.

Monthly payments on a 15-year refinance loan will be bigger compared to a 30-year refinance at the same rate. However, a shorter loan term can help you build up equity in your home much more quickly.

10-Year Fixed-Rate Refinance

The average 10-year, fixed refinance rate is 2.56%, unmoved what we saw last week.

Monthly payments with a 10-year refinance term would cost a massive amount more per month than you would with a 15-year term, but you’ll pay less interest in the long term.

Where Are Rates Going

To determine refinance rate trends, we use data aggregated by Bankrate, which is owned by the same parent company as NextAdvisor. Lenders from across the country supply information to Bankrate, which is provided in the table below:

Average refinance interest rates
ProductRateA week agoChange
30-year fixed refi3.00%3.10%-0.10
15-year fixed refi2.54%2.57%-0.03
10-year fixed refi2.56%2.56%N/C

Rates as of November 20, 2020.

Take a look at mortgage refinance rates for a number of different loans.

Is This the Right Time to Refinance?

In many cases, now is the right time to look into refinancing your existing mortgage. Over the last few months we’ve seen rates drop to record lows. One caveat is that in order to be eligible for the historically low rates you’ll need a strong financial profile. Having a low debt-to-low income ratio, strong credit score, and a healthy down payment is essential. One thing to keep in mind is the Federal Housing Finance Agency has enacted a new 0.5% refinancing fee as of Dec. 1, 2020. This extra cost will apply to conventional refinance loans worth $125,000 or more. You’re likely to find many mortgage lenders that will add the additional fee into their loan offers in one way or another.

Current Landscape for Refinance Rates

Lenders have been unusually busy with refinance loans because of the low interest rates. So while many homeowners can save with a refinance, the time it takes to close on a loan can be longer than usual under normal circumstances. Thanks to the economic downturn, some lenders tightened their lending standards. That means those with weaker financial profiles or less equity in their homes may find it more difficult to qualify for a refinance loan.

When Should You Refinance?

Although there are a number of refinance loan types, the main reasons to refinance are to secure a lower interest rate or to adjust your loan’s term.

Getting a lower interest rate can reduce your monthly payments and save you on interest in the long haul. You can also accomplish the same goal by changing your repayment terms. If you opt for a longer term, you could lower your monthly payments. The trade off to this strategy is you’ll end up paying more interest over the life of the loan. On the other hand, if you refinance to a shorter term loan, say a 15-year mortgage, you’ll pay off your loan sooner and end up paying less interest as a result. Of course, 15-year mortgages have noticeably higher monthly payments compared to 30-year loans. The historically low interest rates that are currently available may allow you to take advantage of a shorter repayment term without increasing your monthly payments by an unreasonable amount. It just depends on how much you’re able to reduce your interest rate by.

If you have a home improvement project you’ve finally got the time to finish, you may be able to fund it with a cash-out refinance. A cash-out refinance enables you to convert the equity you’ve built up in your home into cash. You’ll be taking out a bigger mortgage, but with interest rates where they are, it can be a low-cost way to fund a costly home upgrade.

How to Refinance Your Mortgage

Comparing offers from multiple lenders is essential to getting the best deal on a refinance. To compare offers from every lender you need to look at more than just the interest rate. You should carefully look at the Loan Estimate form each lender will provide after you apply and be sure you’re paying reasonable fees.

What do You Need to Refinance?

Refinancing is a similar process to taking out a mortgage for a home purchase. During the underwriting process, your lender will review your employment, check your credit, and you’ll be required to provide documents to verify your income. Your lender should be able to provide you with a checklist of the supporting documents you’ll need, so you can organize them ahead of time.

How We Got These Rates

The rates we have included are averages provided by Bankrate and are calculated after the close of the previous business day. The lenders that the “Bankrate.com Site Average” tables include are not the same every day.

National lenders provide this mortgage rate information to Bankrate.com. It is possible the mortgage rates we reference has changed since this was published.

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