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Several closely followed mortgage refinance rates advanced today. Both 15-year fixed and 30-year fixed refinances saw their average rates climb. At the same time, average rates for 10-year fixed refinances also saw growth.
Rates have been consistently trending up from historic lows seen during the pandemic. While refinance rates do fluctuate slightly on a daily basis, homeowners can expect to see refinance rates increase due to a number of economic variables, including the Federal Reserve’s decision to raise interest rates multiple times in 2022. If you’re looking to shave dollars and interest off of your current monthly mortgage payments, these could be the lowest rates this year 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
The average 30-year fixed refinance rate right now is 5.42%, an increase of 17 basis points compared to 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. This makes 30-year refinances good for people who are having difficulties making their monthly payments or simply want a bit more breathing room. 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 4.65%, an increase of 19 basis points over last week. With a 15-year fixed refinance, you’ll have a larger monthly payment than a 30-year loan. But you’ll save more money over time, because you’re paying off your loan quicker. 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 current average interest rate for a 10-year refinance is 4.59%, an increase of 5 basis points from what we saw the previous 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
Interest rates are expected to go up this year, as the Federal Reserve recently raised rates for the first time since 2018 and plans to increase them multiple times in 2022. During the pandemic, refinance rates dropped to historic lows, but given factors like Federal Reserve policy, strong economic growth and inflation — which reached its highest in four decades — we’re now seeing interest rates closer to pre-pandemic levels. 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 reported by lenders across the country:
Average refinance interest rates
|Product||Rate||A week ago||Change|
|30-year fixed refi||5.42%||5.25%||+0.17|
|15-year fixed refi||4.65%||4.46%||+0.19|
|10-year fixed refi||4.59%||4.54%||+0.05|
Rates as of Apr. 26, 2022.
How to find personalized refinance rates
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. 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.
You should also know that many lenders have had stricter requirements when it comes to approving loans in the past few months. 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. You can do that by monitoring your credit, taking on debt responsibly, and getting your finances in order before applying for a refinance. 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. 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.
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. 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. 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.