For homeowners looking to save money on their mortgage, refinancing could be the perfect opportunity – if rates are low. Check out today’s rates and see how they stack up against your current loan rate. Here are today’s average mortgage refinance rates for August 10, 2021:
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30-year mortgage refinancing rate
The 30-year average mortgage refinance rate today is 3.048%, up 0.023% from yesterday’s average of 3.025%. A loan at the current average rate would cost you $ 424 per month in principal and interest for every $ 100,000 you refinance. Over the life of the refinance loan, the total interest charge would be $ 52,711 per $ 100,000 of mortgage debt.
20-year mortgage refinancing rate
The 20-year mortgage refinance average rate today is 2.780%, up 0.011% from yesterday’s average of 2.769%. A mortgage refinance loan at the current average interest rate would cost you $ 544 per $ 100,000 borrowed. Your total interest charges over the life of the refinance loan would equal $ 30,476 per $ 100,000 borrowed.
This loan has higher monthly payments than the 30 year loan because you are making payments for a decade less and therefore you are not making as much. Since you spend much less time paying interest, your total costs over time are much lower.
15-year mortgage refinancing rate
The 15-year average mortgage refinance rate today is 2.333%, up 0.015% from yesterday’s average of 2.318%. For every $ 100,000 refinanced at today’s average rate, your monthly principal and interest payment would be $ 659. The total interest charge would be $ 18,612 per $ 100,000 borrowed over the life of the refinance loan.
The monthly payments are very high on this loan as compared to loans offering longer repayment terms. But the cost savings over time are substantial, so you’ll have to decide if it’s worth the compromise.
Should You Refinance Your Mortgage Now?
Refinancing your mortgage can be a smart financial move if you are able to lower your interest rate and monthly payments by getting a new home loan. However, there are a few key things to consider before refinancing.
First, if you extend your loan repayment term, you could end up paying higher total interest charges over time than with your current mortgage. This can happen even if you qualify for a lower interest rate since you would be paying interest over a longer period. You can avoid this problem by choosing a refinance loan with a shorter repayment term. Or you may decide that you are willing to pay more interest over the life of your loan in exchange for a lower monthly payment.
Second, you’ll need to factor in closing costs, which are the upfront fees you will be charged when you refinance your mortgage. Ascent’s research found that the closing costs for a refinance loan for a mid-value home are between $ 5,000 and $ 12,500. However, your closing costs will depend on your mortgage amount, location, and lender.
You might need to offset these closing costs because of your lower monthly payments, but it can take time. If you save $ 200 per month by refinancing and pay $ 6,000 in closing costs, it would take you 2.5 years to break even. It’s important to do the math and determine if you’ll be staying in your home long enough for the refinancing to pay off.
In general, it’s a good idea to refinance if you don’t plan to move in the next few years and can lower your mortgage interest rate by 1% or more. With mortgage refinancing rates nearing all-time lows, many borrowers will find it a good time to refinance. Compare the rates of the best mortgage refinance lenders for personalized offers and decide if getting a new mortgage is right for you now.