A few benchmark refinance rates declined today. Both 15-year fixed and 30-year fixed refinances saw their mean rates decline. At the same time, average rates for 10-year fixed refinances also sank.
Though refinance rates do fluctuate slightly on a daily basis, homeowners can expect to see rates rise over the course of this year. In recent months, rates have been trending up from historic lows seen during the pandemic, and are now closer to 2018 rate levels. That means if you’re looking to shave dollars and interest off your current monthly mortgage payments, these could be the lowest rates of 2022. Make sure to think about your goals and circumstances, and compare offers to find a lender who can meet your needs.
30-year fixed-rate refinance
For 30-year fixed refinances, the average rate is currently at 5.46%, a decrease of 7 basis points from what we saw one week ago. (A basis point is equivalent to 0.01%.) A 30-year fixed refinance will typically have lower monthly payments than a 15-year or 10-year refinance. 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 average rate for a 15-year fixed refinance loan is currently 4.76%, a decrease of 7 basis point from what we saw the previous 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 4.73%, a decrease of 6 basis points compared to one week ago. 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 faster and save on interest in the long run. 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
At the start of the pandemic, refinance rates dropped to historic lows, but now interest rates are hovering around pre-pandemic levels. The Federal Reserve recently raised rates for the second time in 2022, and plans to increase them several more times throughout the year. Given this policy, along with strong economic growth and inflation, which reached its highest in four decades, rates are expected to keep going up this year. While there have been some temporary dips in interest rates, it’s impossible to predict when another drop might occur. That means it’s a good idea to try to take advantage of refinancing now and lock in a decent rate.
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 provided by lenders across the US:
Average refinance interest rates
| Product | Rate | A week ago | Change |
|---|---|---|---|
| 30-year fixed refi | 5.46% | 5.53% | -0.07 |
| 15-year fixed refi | 4.76% | 4.83% | -0.07 |
| 10-year fixed refi | 4.73% | 4.79% | -0.06 |
Rates as of May 19, 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.
Having a high credit score, low credit utilization ratio, and a history of consistent and on-time payments will generally help you get the best interest rates. You can generally get a good feel for average interest rates online, but make sure to speak with a mortgage professional in order to see the specific rates you qualify for. 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. 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. The best way to improve your credit ratings is to get your finances in order, use credit responsibly, and monitor your credit regularly. Also be sure to compare offers from multiple lenders in order to get the best rate.
When should I refinance?
Most people refinance because the market interest rates are lower than their current rates or because they want to change their loan term. It’s true that in the past year, interest rates have been at a historic low. But when deciding whether to refinance, be sure to take into account other factors besides market interest rates.
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.
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. 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.
