Multiple mortgage refinance rates moved down today, causing some homeowners to wonder about refinancing. We saw slumps in the average rates for 10-year fixed, 15-year fixed and 30-year fixed refinances. With rates expected to rise throughout 2022, now might be a good time to act on a refinance. But make sure to first think about your personal goals and circumstances, and compare offers to find a lender who can best meet your needs.
30-year fixed-rate refinance
The current average interest rate for a 30-year refinance is 4.17%, a decrease of 5 basis points from what we saw one week ago. (A basis point is equivalent to 0.01%.) Refinancing to a 30-year fixed loan from a shorter loan term can lower your monthly payments. This makes 30-year refinances good for people who are having difficulties making their monthly payments or simply want a bit more breathing room. In exchange for the lower monthly payments though, rates for a 30-year refinance will typically be higher than 15-year and 10-year refinance rates. You’ll also pay off your loan slower.
15-year fixed-rate refinance
The average 15-year fixed refinance rate right now is 3.39%, a decrease of 15 basis point over last week. Refinancing to a 15-year fixed loan from a 30-year fixed loan will likely raise your monthly payment. On the other hand, you’ll save money on interest, since you’ll pay off the loan sooner. Interest rates for a 15-year refinance also tend to be lower than that of a 30-year refinance, so you’ll save even more in the long run.
10-year fixed-rate refinance
The average 10-year fixed refinance rate right now is 3.39%, a decrease of 6 basis points over last week. A 10-year refinance will typically feature the highest monthly payment of all refinance terms, but the lowest interest rate. A 10-year refinance can help you pay off your house much faster and save on interest in the long run. But you should confirm that you can afford a higher monthly payment by evaluating your budget and overall financial situation.
Where rates are headed
We started 2022 with low refinance rates, but there’s been an uptick recently due to two major factors: inflation and economic growth. That said, rates can always rise and fall for many reasons. The spread of omicron, for instance, kept rates low throughout December and the start of the new year. Overall, rates are expected to go up this year, particularly with the Federal Reserve’s decision to increase interest rates.
We track refinance rate trends using information collected by Bankrate, which is owned by CNET’s parent company. Here’s a table with the average refinance rates supplied by lenders across the country:
Average refinance interest rates
| Product | Rate | Last week | Change |
|---|---|---|---|
| 30-year fixed refi | 4.17% | 4.22% | -0.05 |
| 15-year fixed refi | 3.39% | 3.54% | -0.15 |
| 10-year fixed refi | 3.39% | 3.45% | -0.06 |
Rates as of Feb. 22, 2022.
How to find personalized refinance rates
When looking for refinance rates, know that your specific rate may differ from those advertised online. Market conditions aren’t the only factor in interest rates; your particular application and credit history will also play a large role.
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. To get your personalized refinance rates, you’ll need to speak with a mortgage professional, as the rates you qualify for may differ from the rates advertised online. And don’t forget about fees and closing costs which may cost a hefty amount upfront.
It’s also worth noting that in recent months, lenders have been stricter with their requirements. This means that if you don’t have great credit ratings, you might not be able to take advantage of lowered interest rates — or qualify for a refinance in the first place.
One way to get the best refinance rates is to strengthen your borrower application. 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 offer from multiple lenders in order to get the best rate.
When to consider a mortgage refinance
In order for a refinance to make sense, you’ll generally want to get a lower interest rate than your current rate. Aside from interest rates, changing your loan term is another reason to refinance. Interest rates in the past few months have been at historic lows, but that’s not the only thing you should be looking at when deciding whether to refinance.
A refinance may not always make financial sense. Consider your personal goals and financial circumstances. How long do you plan on staying in your home? Are you refinancing to decrease your monthly payment, pay off your house sooner — or for a combination of reasons? And don’t forget about fees and closing costs, which can add up.
Note that some lenders have tightened their requirements since the beginning of the pandemic. If you don’t have a solid credit score, you may not qualify for the best rate. If you can get a lower interest rate or pay off your loan sooner, refinancing can be a great move. But carefully weigh the pros and cons first to make sure it’s a good fit for your situation.
