Current Mortgage Refinance Rates – April 2, 2021: Rates Rise
Thinking of refinancing? Here’s what the average mortgage refinance rates look like today.
On April 2, 2021, mortgage refinancing rates rose again, continuing a trend that has persisted for weeks. In early April, homeowners may consider applying for a new refinance loan if they can lower the interest charges compared to their current home loan.
Here’s what you need to know about current average rates to see if you could save on interest by refinancing your home.
30-year mortgage refinancing rate
The 30-year average mortgage refinance rate today is 3.415%, up 0.01% from yesterday’s average of 3.405%. For every $ 100,000 refinanced at the current average rate, your monthly principal and interest payment would be $ 444. The total interest cost would be $ 59,953 per $ 100,000 of mortgage debt over the term of the refinance loan.
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20-year mortgage refinancing rate
The average 20-year mortgage refinance rate today is 3.127%, up 0.022% from yesterday’s average of 3.105%. A mortgage refinance loan at the current average interest rate would cost you $ 561 per $ 100,000 borrowed. This would be a total interest charge of $ 34,634 per $ 100,000 of mortgage debt refinanced over the term of the loan.
The choice of the duration of the refinance loan is important as it affects the total amount saved as well as the monthly payments. A longer loan term means higher costs over time, but lower monthly payments. A shorter loan term means lower total interest charges, but each payment is higher. Think about what makes sense for your situation.
15-year mortgage refinancing rate
The 15-year mortgage refinance average rate today is 2.692%, up 0.004% from yesterday’s average of 2.688%. At the current average rate, the monthly principal and interest would be $ 676 per $ 100,000 of mortgage debt refinanced. The total interest charge would be $ 21,656 per $ 100,000 borrowed over the term of the refinance loan.
Again, the 15 year loan saves money over time compared to loans with longer repayment terms. But as you can see the monthly payments are much higher than with the 20 or 30 year loan. It is important to weigh the tradeoffs when deciding which loan is the best.
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 lower your 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 because you will 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 will need to factor in the closing costs. These are the upfront fees you will need to pay when you refinance your mortgage. Ascent’s research found that the closing costs for a refinance loan for a mid-value home totaled between $ 5,000 and $ 12,500. However, your closing costs will depend on your mortgage amount, location, and lender.
You might have to offset those closing costs due to your lower monthly payments – but it can take time. If you save $ 200 a 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 record lows, many borrowers will find the time to be right 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.