A few important refinance rates receded today. Both 15-year fixed and 30-year fixed refinances saw their average rates recede. At the same time, average rates for 10-year fixed refinances stayed the same. Refinance interest rates are never set in stone — but rates have been historically low. If you plan to refinance your home, now might be a great time to lock in a good rate. But as always, make sure to first take into account your personal goals and circumstances before refinancing, and shop around for a lender who can best meet your needs.
30-year fixed refinance rates
For 30-year fixed refinances, the average rate is currently at 2.99%, a decrease of 5 basis points from what we saw one week ago. (A basis point is equivalent to 0.01%.) One reason to refinance to a 30-year fixed loan from a shorter loan term is to lower your monthly payment. Because of this, a 30-year refinance can be a good idea if you’re having trouble making your monthly payments. However, interest rates for a 30-year refinance will typically be higher than rates for a 15-year or 10-year refinance. It’ll also take you longer to pay off your loan.
15-year fixed-rate refinance
The current average interest rate for 15-year refinances is 2.30%, a decrease of 1 basis point compared to one week ago. With a 15-year fixed refinance, you’ll have a larger monthly payment than a 30-year loan. On the other hand, you’ll save money on interest, since you’ll pay off the loan sooner. You’ll also typically get lower interest rates compared to a 30-year loan. This can help you save even more in the long run.
10-year fixed-rate refinance
The current average interest rate for a 10-year refinance is 2.33%, unmoved from what we saw the previous week. Compared to a 30-year and 15-year refinance, a 10-year refinance will usually have a lower interest rate but higher monthly payment. A 10-year refinance can help you pay off your house much quicker and save on interest. 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 data collected by Bankrate, which is owned by CNET’s parent company. Here’s a table with the average refinance rates reported by lenders across the US:
Average refinance interest rates
|Product||Rate||A week ago||Change|
|30-year fixed refi||2.99%||3.04%||-0.05|
|15-year fixed refi||2.30%||2.31%||-0.01|
|10-year fixed refi||2.33%||2.33%||N/C|
Rates as of Aug. 23, 2021.
How to find the best refinance rate
When searching for refinance rates online, it’s important to remember that your specific financial situation will influence the rate you’re offered. Your interest rate will be influenced by market conditions as well as your credit history and application.
Generally, you’ll want a high credit score, 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.
It’s also worth noting that in recent months, lenders have been stricter with their requirements. As such, you may not qualify for a refinance — or a low rate — if you don’t have a solid credit rating.
Before applying for a refinance, you should make your application as strong as possible in order to get the best rates available. If you haven’t already, try to improve your credit by monitoring your credit reports, using credit responsibly, and managing your finances carefully. Also be sure to compare offers from multiple lenders in order to get the best rate.
When should I refinance?
Generally, it’s a good idea to refinance if you can get a lower interest rate than that 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.
To decide whether a refinance is right for you, consider all of the factors including how long you plan to stay in your current home, the length of your loan term and the amount of your monthly payment. 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.