Mortgage Refinancing Rates Today October 1, 2021 | Tariff increase
Several notable mortgage refinancing rates are higher today.
The average interest rates rose for both 15-year and 30-year fixed interest rates. The average interest rate on 10-year fixed-rate mortgages with refinancing also rose.
Refinancing rates are constantly changing. However, interest rates have been hovering near historic lows for some time. For those looking to refinance their existing mortgage, this could be the perfect time to get a record low interest rate.
Take a look at the current refinancing rates:
Compare the refinancing rates for a wide variety of loans here.
What that means for homeowners
With refinance rates still hovering around 3%, there is still an opportunity to secure a great rate for homeowners who haven’t refinanced in the past few years. When deciding to refinance, however, it is not just a question of the interest rate, but also of the closing costs. So make sure you save more in the long run than you pay for up front. And don’t forget that even with no-closing-cost refinancing, fees still apply, these are usually just added to your credit balance rather than being paid out of pocket.
30-year fixed refi rates
Right now, the average 30 year fixed refinance has an interest rate of 3.15%, an increase of 14 basis points from what we saw last week.
You can use our mortgage calculator to determine how much your mortgage is costing you each month and how an additional monthly payment will affect your mortgage. Our mortgage calculator also shows you how much interest you have to pay over the entire term of the loan.
15-year refinancing rates
For 15-year fixed refinances, we see an average interest rate of 2.44%, an increase of 16 basis points from the previous week.
The monthly payments for a 15-year refinancing loan are higher than for a 30-year refinancing at the same interest rate. However, a shorter repayment term can save you thousands of dollars in interest over the life of the loan.
Average 10-year fixed refinancing rates
The 10-year average fixed refinancing rate is 2.38%, an increase of 13 basis points from the rate observed the previous week.
Monthly payments with a refinancing term of 10 years would cost significantly more per month than with a term of 15 years, but you pay less interest in the long run.
Refinancing rate trends
Currently, refinancing rates are extremely low compared to recent mortgage rate history. According to Freddie Mac’s weekly poll, rates have been hovering around 3% since April 2021.
Even with a moderate increase, interest rates could remain cheap for borrowers. Some experts predict that mortgage rates will remain low and that rates are likely to rise steadily much later this year. Where refinancing rates move over the long term depends on general factors such as inflation and our economic recovery.
This is how we calculate our refinancing rates
Our refinancing rate trends are based on daily interest rate data from Bankrate, which is owned by the same parent company as NextAdvisor. These average overnight refinancing rates are based on a consumer profile that meets these requirements:
- Loan-to-Value (LTV) or 80% or less
- Main residence
- 740+ creditworthiness
- detached house
The information provided by bankrate lenders across the country is shown in the table below:
Prices from October 1st, 2021.
Check out the mortgage refinancing rates for a number of different loans.
Does refinancing still make sense?
Last year was a historically excellent time to refinance, as interest rates had never been lower. However, mortgage rates have risen since January and exceeded the 3% threshold for the first time since last summer.
Even though the days of record-breaking refinance rates are behind us, this is still an exceptional time to refinance for many homeowners. If you can hold onto today’s interest rates, which are just over 3%, you get a deal with an almost unprecedented lows.
So there is still time to save with a refinancing, but this window is closing. Many experts predict that interest rates will continue to rise when the economy returns to pre-pandemic levels over the next year.
This is how you get the lowest refi price
The refinancing rates are influenced by your personal finances. Healthier credit ratings and lower loan-to-value ratios (LTV) usually qualify for a higher discount on their refinancing rate.
Your personal finances are not the only factor that affects the refinance rates that are offered to you. The equity that you have in the house 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 can determine your interest rate. A shorter term loan typically has lower refinancing rates than longer term mortgage refinancing loans, all other things being equal. Your refinancing rate will also be affected by the type of mortgage refinancing that you plan to take out. Cash out refinancing loans typically have higher mortgage refinancing rates than other loans.
Average refinancing costs
There are a handful of things to consider that affect refinancing costs, including:
- Where the property is located
- Type of mortgage
- Which Lender You Choose
- Credit balance
- FICO result
- Home equity
Generally, the closing cost of refinancing is 3% to 6% of the loan balance. The type of loan you are refinancing into can affect costs in a number of ways. Certain government-sponsored refinance loans such as the FHA Streamline or VA Interest Rate Reduction Refinance Loan (IRRRL) may not require a valuation but may come with high upfront fees to cover mortgage insurance. On the other hand, if you have enough equity, you can refinance yourself into a conventional loan to potentially get rid of the mortgage insurance requirement.