Current Mortgage Refinance Rates

Compare today's refinance rates

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The Balance / Bailey Mariner

Updated: December 3, 2021

As of today, December 3, 2021, the average 30-year fixed mortgage refinance rate is 3.38%, FHA 30-year fixed is 3.53%, jumbo 30-year fixed is 3.56%; 15-year fixed is 2.63%, and 5/1 ARM is 2.84%. Our rates may differ from what you see in online advertisements from lenders, but they should be more representative of what you could expect from a lender quote, depending on your qualifications. Check out the Methodology section of this page to learn more about what makes our rates different.

A mortgage refinance occurs by paying off an existing home loan with a new home loan. Homeowners can refinance for a variety of reasons, and you can expect the mortgage refinancing rates on loans to be about the same as regular mortgage rates. However, if you opt for a cash-out refinance, you'll usually pay a higher rate.

Today's Mortgage Refinance Rates

Loan Type Refinance Purchase
30-Year Fixed 3.38% 3.26%
FHA 30-Year Fixed 3.53% 3.13%
VA 30-Year Fixed 3.57% 3.20%
Jumbo 30-Year Fixed 3.56% 3.40%
20-Year Fixed 3.19% 3.07%
15-Year Fixed 2.63% 2.53%
Jumbo 15-Year Fixed 3.40% 3.12%
10-Year Fixed 2.60% 2.49%
10/1 ARM 3.63% 2.89%
10/6 ARM 3.97% 3.75%
7/1 ARM 2.67% 2.56%
Jumbo 7/1 ARM 2.42% 2.19%
7/6 ARM 4.06% 4.01%
Jumbo 7/6 ARM 2.98% 2.70%
5/1 ARM 2.84% 2.45%
Jumbo 5/1 ARM 2.27% 2.04%
5/6 ARM 3.92% 4.02%
Jumbo 5/6 ARM 2.79% 2.61%

Given the low interest rate environment in the United States, mortgage refinancing can be a great way to reduce your monthly principal and interest (P&I) payment and overall interest costs. Plus, depending on your current rate, you might also be able to reduce your rate and pay your loan off quicker without a significant impact on your monthly P&I payment. This could save you a lot of money in the long run.

However, you shouldn’t base your decision solely on the interest rate you’ll receive. Make sure to consider the costs associated with a refinance because it usually doesn’t come free. If you decide to refinance your mortgage, the new loan should put you in a better financial position than your old loan. For example, you should receive a better rate or get better repayment terms. If you’re not going to be in a better financial position, then you may as well keep your old loan.

Frequently Asked Questions (FAQs)

Written by Megan Hanna

What Is Mortgage Refinancing?

Refinancing a mortgage is what happens when you get a new mortgage and use it to pay off your existing mortgage. Homeowners often use mortgage refinancing as a way to reduce their interest rate, extend their repayment term to lower the payment, shorten the repayment term to pay the loan off more quickly, take out some of their equity in the form of cash, or consolidate other real estate debt like a home equity loan into a single loan. Determining why you want to refinance your debt can help you find the best mortgage refinancing options. 

Keep in mind that mortgage refinance rates are only one factor you should consider when deciding if a mortgage refinance is right for you. Make sure to consider such things as how much the refinance will cost and the repayment terms you’re going to get (e.g., a fixed rate versus an adjustable rate, a 15-year term versus a 30-year term). Ultimately, you should only refinance your existing mortgage if you’ll end up in a better financial position.

Why Should I Consider Refinancing My Mortgage? 

Some of the common reasons why people choose to refinance their mortgages are to:

  • Reduce the interest rate: People with an existing mortgage might get a lower interest rate with mortgage refinancing. To put this in perspective, the U.S. is currently in a low interest rate environment, with an average rate of 2.73% for a 30-year fixed-rate mortgage in January 2021 compared to an average rate of 4.45% in January 2019. 
  • Lower the payment with a longer repayment term: One way to lower your payment is to reduce your interest rate. Another way is to get a longer repayment term, which is why some people refinance their mortgages. For example, the P&I payment on a $250,000 15-year fixed-rate mortgage with a rate of 3% would be $1,726.45 compared to a monthly P&I payment of $1,054.01 with a 30-year term.
  • Pay it off more quickly with a shorter repayment term: Conversely, some people may choose to use a mortgage refinance to pay off their debt more quickly. Let’s say you had an existing 30-year mortgage with a 6% rate and an original balance of $300,000 that you had been paying on for five years. If you were to refinance the principal balance into a 15-year mortgage with a rate of 2.20%, your P&I payment would increase slightly from $1,798.65 a month to $1,822.26 a month, but your loan would be paid in full in 15 years.
  • Cash out some of their equity: People sometimes choose to refinance their mortgage to cash-out some of their equity. With a mortgage refinance, you might be able to get a bigger mortgage than your original mortgage. The extra money will be distributed to you in cash. Keep in mind you’ll need to have enough equity in your home to support the refinance, either from appreciation in your home’s value or the principal payments you’ve made over time. 
  • Consolidate other housing debt: Sometimes, people have a second mortgage or a home equity loan. They might use a mortgage refinance to consolidate this debt into one loan. In doing so, it’s simpler to keep track of what’s owed. Plus, home equity loans often have variable rates. There’s an additional risk with a variable rate since your payment will change as rates increase or decrease. By combining the debt into one fixed-rate mortgage, you’ll no longer have to worry about changes to your P&I payments.

There are many reasons why people might use mortgage refinancing. Before you decide to do this, think about what you’re trying to accomplish and how much the refinance will cost you. You’ll likely need to pay fees for a new appraisal on your home, as well as other closing costs. That said, carefully consider a mortgage refinance to make sure it’s worth it in the long run and that it’s helping improve your financial condition. 

And remember, take care to avoid situations that could potentially put you in a worse financial position. For example, you might be able to get a lower rate on an adjustable-rate mortgage (ARM) than a fixed-rate mortgage, but you could end up paying a higher rate when it adjusts in the future. Therefore, make sure you aren’t sacrificing long-term benefits for short-term gains. 

How Do Mortgage Refinance Rates Differ From Regular Mortgage Rates?

The purpose of your refinance will play a role in how different the mortgage refinance rate is from a regular refinance rate. If you’re simply refinancing your mortgage to get a lower rate to reduce your interest costs or a shorter repayment term to pay off your loan more quickly, then there may be no difference. However, if you want to take cash equity out of your home (called a cash-out refinance), then the mortgage refinance rate will likely be higher than regular mortgage rates. 

With a cash-out refinance, not only are you increasing your loan amount, but you’re also reducing the amount of equity in your home. This means your loan-to-value (LTV) ratio will be higher (worse) after the cash-out refinance. The increased loan amount and higher LTV ratio are riskier to the lender. Lenders usually make up for this added risk by charging a higher interest rate than what you would have been able to get if you didn’t take out additional cash. 

Why Are Refinance Rates Different from Traditional Mortgage Rates? 

As with a regular mortgage, the rate you can receive on a mortgage refinance will vary based on the type of mortgage you get, i.e., 15-year fixed-rate vs. 30-year fixed-rate. Plus, rates may be higher if you’re planning to take a cash-out refinance. In either case, mortgage rates will typically be lower on mortgage refinances with shorter fixed-rate terms than on refinances with longer fixed-rate terms. 

The reason rates are lower with shorter fixed-rate mortgages than with longer fixed-rate mortgages is because shorter terms are considered less risky than longer terms. One reason longer terms are riskier to lenders is that there is more interest rate risk. If rates go up, lenders are potentially stuck with a low rate loan for a longer period of time. This means they might not be able to make as many new loans, which could carry higher rates and make them more money.

Another reason longer terms are riskier to lenders is that there’s more risk that something unexpected might happen that negatively affects your ability to repay the loan. For example, you might lose your job or there could be a recession or economic downturn that affects your ability to repay. To make up for this additional risk, lenders will charge a higher interest rate on longer fixed-rate term loans. 

How Do I Qualify for Better Mortgage Refinancing Rates?

The biggest thing you can do to qualify for a better mortgage refinancing rate is to make sure your credit score is as good as possible. Your credit score affects the mortgage rate you can get because it’s a measure of how risky you are as a borrower. Lenders see people with better credit scores as carrying a lower level of risk. As a result, you’ll usually be able to get a better mortgage refinancing rate if you have a better credit score. 

To put this in perspective, estimated APRs and monthly payments for four different credit scores on a $350,000 30-year fixed-rate mortgage are shown below:

Credit Score Classification Estimated APR Monthly P&I Payment
800 Excellent 2.32% $1,350
740 Very Good 2.542% $1,391
680 Good 2.719% $1,423
620 Fair 3.909% $1,653

As you can see, people with exceptional credit may be able to receive a rate that’s almost 1.6% less than someone with fair credit. The impact on the monthly P&I payment for a $350,000 loan in our example was a difference of over $300. All of this additional money goes toward interest costs making the same loan cost more for people with worse credit.

That said, it’s smart to wait until you’ve gotten your credit score as high as it can be before you apply for a mortgage refinance. The amount of time for a credit score improvement will depend on the severity of your credit issues. For example, if you’ve built up large credit card balances, this may be a quicker issue to resolve than a recent car repossession. But if you want to qualify for the best mortgage rate possible, be patient and stay the course. Eventually, you’ll improve your credit score.

What Are the Current Average Mortgage Refinancing Rates?

Although you may pay a little more for a cash-out mortgage refinance, you can expect the rates you’ll pay for a non-cash-out mortgage refinance to be similar to regular mortgage rates. The current 15-year fixed-rate mortgage average in the United States is 2.20%. This is compared to a current 30-year fixed-rate mortgage average in the United States of 2.73%. 

Also, rates may vary depending on whether you get a conforming vs. FHA loan, a loan that’s insured by the Department of Veterans Affairs (a VA loan), a loan insured by the USDA, or even a jumbo loan. For example, as of January 2021, the average 30-year fixed rate for a VA loan was 2.422% compared to a rate of 2.812% for a conforming mortgage.  

Rates for some of the most common types of mortgages for the most recent three years are shown below:

Type of Mortgage  Rate as of January 28, 2021 Rate as of January 28, 2020 Rate as of January 28, 2019
30-Year Fixed-Rate Conforming Mortgage 2.812% 3.710% 4.796%
30-Year Fixed-Rate FHA Mortgage 2.803% 3.874% 4.938%
30-Year Fixed-Rate VA Mortgage 2.422% 3.448% 4.649%
30-Year Fixed-Rate USDA Mortgage 2.711% 3.753% 4.860%
30-Year Fixed-Rate Jumbo Mortgage 2.878% 3.802% 4.574%
15-Year Fixed-Rate Conforming Mortgage 2.298% 3.136% 4.093%

Keep in mind, mortgage rates fluctuate based on economic trends like inflation, unemployment rates, and monetary policies set by the Federal Reserve. For this reason, in a low interest rate environment, it’s a good idea to lock in your rate as soon as possible. Conversely, in higher interest environments where rate reductions are expected in the near-term, then it might be wise to hold off locking in the rate for a little while. However, in that situation, you do run the risk that interest rates might increase before you lock yours in.

The bottom line is that mortgage rates change quickly and frequently. Pay attention to what’s happening in the market so you’re able to secure the best possible interest rate. 

Methodology

To find the best mortgage refinance rates, we averaged the lowest rate offered by more than 200 of the country's top lenders, assuming a loan-to-value ratio (LTV) of 80% and an applicant with a FICO credit score in the 700-760 range. The resulting rates are representative of what customers should expect to see when receiving actual quotes from lenders based on their qualifications, which may vary from the rates lenders advertise.

These mortgage rates are for informational purposes only. Rates may change daily and are subject to change without notice. Loans above a certain threshold may have different loan terms, and products used in our calculations may not be available in all states. Loan rates used do not include amounts for taxes or insurance premiums. Individual lender’s terms will apply.