Today, a few benchmark refinance rates trailed off.
Both the 15-year fixed and 30-year fixed saw their average rates decrease. The average rate on 10-year fixed refinance mortgages also declined.
Throughout the first months of 2022 refinance rates have been on a tear, increasing dramatically. Short-term interest rates have already increased multiple times, and the Fed plans to do so again in the coming months.
A borrower should carefully review the numbers before taking out a new mortgage in the current interest rate environment. Simply put, the cost of refinancing is increasing because rates are higher. With that in mind, your refinance rate isn’t the only thing that matters. The fees you pay to close a home loan matter, and can add up to thousands of dollars.
Here’s where refinance rates are today .
Take a look at today’s refinance rates:
- The average 30-year fixed-rate refinance is 6.90%
- Currently, the average 15-year fixed-rate refinance is 6.23%
- Today, the average 10-year fixed refinance rate is 6.37%
Refinance Rate Trends
September’s Consumer Price Index (CPI) reported annual inflation was lower than August, but still inflated, at 8.2%. And that’s not good for refinance rates.
In response to high inflation that has lasted longer than initially anticipated, the Federal Reserve has increased interest rates in May, June, and July. Because of all of this, we could be stuck with high inflation for much longer than we want, which makes it more likely that the Fed will have to raise interest rates aggressively.
Is It a Good Time to Refinance Right Now?
As a rule of thumb, refinancing can save you money if you can secure an interest rate that’s around 1% lower than your existing rate. That said, the recent spike in refinance rates has drastically reduced the number of homeowners with interest rates that are well above today’s average rates.
There are alternatives to refinancing. With values rising in today’s housing market, homeowners may want to turn that value into cash. With rates where they are, a home equity line of credit (HELOC) may make sense for you because you won’t have to take out a new mortgage. A HELOC can be a reasonable option for financing home repairs or improvements, just be sure to understand all of the fine print regardless fees, the interest rate and the repayment schedule..
Pro Tip: Pay Attention to Refinance Fees
You will pay upfront fees of 3% to 6% of your loan amount when you take out a new home loan. It is a significant expense that needs to be taken into account in the refinancing process. When you refinance frequently or sell your home soon after refinancing, you may not experience enough savings to justify the upfront fees.
Average 30-Year Fixed Refinance Rates
Right now, the average 30-year fixed refinance has an interest rate of 6.90%, a decrease of 3 basis points from what we saw last week.
You can use our mortgage calculator to determine how much your mortgage will cost you every month 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.
Average 15-Year Refinance Rates
Right now, average 15-year fixed refinance rates are 6.23%, a decrease of 3 basis points over the previous week.
Monthly payments on a 15-year refinance loan are tougher to fit into a monthly budget than a 30-year mortgage payment would be. However, a shorter loan term can help you build up equity in your home much more quickly.
10-Year Fixed Refi Rates
The average 10-year, fixed refinance rate is 6.37%, a decrease of 6 basis points from what we saw last week.
Monthly payments with a 10-year refinance term would cost even more than what you’d pay on a 15-year loan. The upside is you’d end up paying even less interest over the life of the loan.
How our refi rates are calculated
Our daily refi rates are based Bankrate’s daily rate data, which is owned by the same parent company as NextAdvisor. These daily refinance rate averages are based on a borrower profile that meets these qualifications:
- Loan to value (LTV) or 80% or less
- Principal residence
- FICO score of 740 or higher
- Single-family home
The information supplied to Bankrate from lenders across the nation is provided in the table below:
|30-year mortgage refinance rate||6.90%||6.93%||-0.03|
|15-year fixed refinance rate||6.23%||6.26%||-0.03|
|10-year fixed refinance rate||6.37%||6.43%||-0.06|
Rates as of November 22, 2022.
Refinance Rate Frequently Asked Questions (FAQ):
Is It Still a Good Time to Refinance?
The decision to refinance isn’t driven only by market factors such as interest rates or home values, your personal situation also matters. You’ll want to ask yourself if refinancing will help you accomplish your goals
If you can reduce your interest rate enough to offset the upfront closing costs, refinancing may be a good idea. There are times, however, when the main reason for refinancing isn’t to secure a lower interest rate. Opening a home equity line of credit has grown in popularity recently as homeowners have decided to capitalize on increasing home values. Home equity lines of credit typically have higher rates compare to other options, but it can be a good way to pay for home upgrades or to pay off other higher interest debt.
As long as refinancing aligns with your financial goals and gets you closer to achieving them, then now is a good time to refinance.
How to Qualify for the Best Refi Rate
Your financial situation has a big effect on the refinance rate you can qualify for. Having a lower loan-to-value ratio for your home and a healthier credit score typically will get you a lower mortgage refinance rate.
Your personal finances aren’t the only consideration that affects the mortgage refinance rate you qualify for. The equity you have in the home also comes into play. You want to have at least 20% equity, or a loan-to-value ratio of 80% or less.
The type of mortgage loan will impact what your refinance rate will be. A loan with a shorter repayment term usually has lower interest rates than refinance loans with longer repayment terms, all else equal. Also, if you want to pull cash out of your home with a cash-out refinance, you should expect to pay a higher mortgage rate for that privilege.
How Much Does It Cost to Refinance?
If you refinance your mortgage, closing costs typically range from 3% to 6% of the loan amount. For a $300,000 loan that’s $9,000 to $18,000 in fees.
But, each lender will assess your personal situation differently. So it’s important to shop around and compare offers. Everything from where the property is located to the type of loan you’re refinancing into can change what you’ll pay to refinance.
Mortgage Interest Rates by Loan Type
Mortgage Refinance Rates
Home Loan Interest Rates
- 30 Year Fixed Mortgage Rates
- 20 Year Fixed Mortgage Rates
- 15 Year Fixed Mortgage Rates
- 10 Year Fixed Mortgage Rates