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The interest rate for a 30-year fixed-term refinancing fell today.
According to Curinos, the average interest rate for refinancing a 30-year fixed-rate mortgage is currently 6.91 percent. For refinancing a 15-year mortgage, the average interest rate is 6.10 percent and for a 20-year mortgage, the average interest rate is 6.73 percent.
Related: Compare current refinancing rates
Refinancing rates for August 27, 2024
30-year fixed refinancing rates
The average interest rate to refinance a 30-year fixed-rate mortgage fell to 6.91% compared to yesterday. Last week, the 30-year fixed rate was 7.07%.
If you refinance a 30-year fixed-rate mortgage, the APR is 6.93%, which is lower than last week. The APR includes the interest rate and financing costs of a loan. It represents the total cost of your loan.
According to Forbes Advisor’s mortgage calculator, borrowers with a $100,000 30-year fixed-rate mortgage refinance at a current interest rate of 6.91% will pay $659 per month in principal and interest (not including taxes and fees). In total, you would pay $137,337 in interest over the life of the loan.
20-year refinancing rates
Refinancing a 20-year fixed-rate mortgage currently averages about 6.73%. At the same time last week, the average was 6.79%.
The annual percentage rate (APR) for a 20-year fixed-rate mortgage is 6.76%, up from 6.82% at the same time last week.
At the current interest rate of 6.73%, a $100,000 20-year fixed-rate mortgage refinance would yield $759 per month in principal and interest, not including taxes and fees. The borrower would pay a total of approximately $82,202 in interest over the life of the loan.
15-year refinancing rates
For a 15-year fixed-term refinance mortgage, the average interest rate is currently 6.10%, compared to 6.24% at the same time last week.
The annual percentage rate for a 15-year fixed-rate mortgage is 6.13%. This time last week it was 6.27%.
At the current interest rate of 6.10%, a 15-year fixed-rate mortgage refinance of $100,000 would cost $849 per month in principal and interest, not including taxes and fees. That’s about $52,878 in total interest over the life of the loan.
Interest rates for refinancing 30-year jumbo bonds
The average interest rate to refinance a 30-year fixed-rate jumbo mortgage is 6.92%. Last week, the average interest rate was 7.06%.
Borrowers refinancing a 30-year fixed-rate jumbo mortgage at today’s interest rate of 6.92% will pay $660 per month in principal and interest on a $100,000 loan.
Interest rates for refinancing 15-year jumbo bonds
The average interest rate for refinancing 15-year fixed-rate jumbo mortgages remained unchanged at 6.66%. Last week, the average rate was 6.76%.
Borrowers with a 15-year fixed-rate jumbo mortgage refinancing at today’s 6.66% rate will pay $880 per month in principal and interest per $100,000. That means that on a $750,000 loan, you would pay a total of about $438,126 in interest over the life of the loan.
Are refinancing rates and mortgage rates the same?
No, mortgage refinance rates are typically higher than purchase loan rates because of the added risk to the lender. Cash-out refinance rates are also higher than a standard rate and term refinance because you are increasing your loan balance by leveraging your equity.
The application process for refinancing a mortgage is similar to that for a home purchase loan in terms of required documentation and home appraisal. Additionally, there are similar closing costs of 2% to 6% of the loan amount, which is an additional cost.
When you refinance, your new interest rate will be based on current refinance rates and your loan term. This rate will replace your existing mortgage repayment terms.
Know when to refinance your home
You may want to refinance your home if you can lower your interest rate, reduce monthly payments, or pay off your mortgage faster. You may want to use cash-out financing to access the equity in your home or take out a new loan to eliminate private mortgage insurance (PMI).
Refinancing your home loan can make sense, especially if you plan to stay in your home for a while. Even if you get a lower interest rate, you still need to consider the cost of borrowing. Calculate the break-even point at which your savings from a lower interest rate exceed your closing costs by dividing your closing costs by the monthly savings from your new payment.
Our mortgage refinance calculator can help you determine if refinancing is right for you.
Is now a good time to refinance?
Now may be a good time to refinance if you can lower your monthly payment by getting a better interest rate or adjusting your repayment term.
While refinance rates are at multi-year highs, you may qualify for a competitive rate if your credit score has improved since you got your existing mortgage or if you switch to a shorter loan term, such as a 15-year mortgage. By refinancing from a government-backed loan to a conventional loan with at least 20% equity, you may be able to forgo private mortgage insurance, FHA mortgage insurance premiums, or USDA guarantee fees.
There are many options available for refinancing your mortgage, some of which allow you to use the equity in your home.
If you can’t get a better interest rate or reduce your monthly payment, you should avoid refinancing. Plus, you’ll have to pay closing costs and the application process can be lengthy. These obstacles can outweigh the potential benefits of refinancing.
How to get today’s best refinancing rates
Refinancing a mortgage is not much different from taking out a mortgage. It is always wise to have a strategy to find the lowest possible interest rate. Here are some suggestions on how to get the best rate:
- Improve your credit rating
- Lower your debt-to-income ratio
- Keep an eye on mortgage rates
- Consider a shorter loan
A good credit score is one of the best things you can do to get approved and get a lower interest rate. You’re also likely to get better approval from lenders if you don’t have too much debt relative to your income. You should keep an eye on mortgage rates regularly, as they often fluctuate. Also, check to see if you can afford a mortgage payment on a shorter loan term, as these usually have lower interest rates.
Frequently Asked Questions (FAQs)
How quickly can you refinance a mortgage?
In many cases, you can refinance a mortgage as early as six months after you start making repayments, although some lenders insist that you wait 12 months. To be sure, ask your lender.
How do you find the best lender for refinancing?
Our guide to the best lenders for mortgage refinancing is a good place to start, but make sure you compare multiple lenders and get more than one quote. It’s always a good idea to research the closing costs lenders charge and make sure you can communicate easily with your lender. Conditions in the real estate market change frequently, so being able to rely on your lender is crucial.
How much does it cost to refinance a mortgage?
Closing costs for a refinance can range from 2% to 6% of the loan cost. It’s always a good idea to ask the lender what closing costs they charge before you decide to take out a loan.
