December 12, 2023 Mortgage Refinance Rates drop

Homeowners typically use refinancing to save money. Even though elevated interest rates mean that it is unlikely that you will be able to secure a significantly lower rate than your current one, it is still possible to refinance for other reasons, including changing your term length or loan type.

There was a decrease in the average rate for 15-year fixed refinances and 30-year fixed refinances this week, as well as a decline in the average rate for 10-year fixed refinances.

As the pandemic began, millions of homeowners refinanced when mortgage rates reached record lows. According to Matt Graham of Mortgage News Daily, refinance demand is primarily for cash-out refinances for debt consolidation or to fund other major expenses in today’s high-rate environment. For those considering a refinance, Graham suggests getting in touch with a loan originator, keeping an eye on daily rate changes, and creating a game plan to capitalize on the next large rate drop.

Refinance rates for homeowners

There are a number of disadvantages that homeowners face in the current housing market, including elevated mortgage rates, limited inventory, and high home prices.

To find the best deal on refinancing, make sure to compare rates, fees, and the annual percentage rate of different lenders, which are indicative of the total cost of borrowing. We track refinance rate trends using data gathered by Bankrate. Below is a table containing the average refinance rates supplied by lenders nationwide.

Today’s refinance interest rates

Product	Rate	A week ago	Change
30-year fixed refi	7.46%	7.63%	-0.17
15-year fixed refi	6.77%	6.87%	-0.10
10-year fixed refi	6.82%	6.89%	-0.07

Rates as of December 12, 2023.

Refinance rates: how to shop

Market conditions, your credit history, financial profile, and application, as well as your specific credit history and financial profile, will all have an impact on your personal interest rate. You will generally receive the best interest rates if you have a high credit score, low credit utilization ratio, and a history of consistent and on-time payments. Get your finances in order, utilize your credit responsibly, and monitor your credit regularly to ensure you receive the best refinance rates. Also, don’t forget to speak with several lenders and shop around for the best rates.

Refinancing can be a great option if you are able to get a good rate or pay off your loan sooner, but consider whether it is the right choice for you at this time.

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30-year fixed-rate refinance

As of this week, the average interest rate for a 30-year refinance has declined by 17 basis points to 7.46%. Typically, 30-year fixed refinances have lower monthly payments than 15-year or 10-year refinances, so they can be an effective option if your monthly payments are difficult to meet. In contrast, if you refinance for 30 years, it will typically take you longer to repay the loan and you will typically pay more interest.

15-year fixed-rate refinance

Our 15-year fixed refinance rate is currently 6.67 percent, a decrease of 10 basis points from the previous week. Though a 15-year fixed refinance will most likely raise your monthly payment compared to a 30-year loan, you’ll save more money in the long run since you’ll be able to pay off your loan faster. Additionally, 15-year refinance rates are typically lower than 30-year refinance rates, which may allow you to save more money in the long run.

10-year fixed-rate refinance

In the current market, the average rate for a 10-year fixed refinance loan is 6.82 percent, a decrease of 7 basis points from last week. The 10-year refinance term usually has the lowest interest rate but the highest monthly payment among all refinance terms. With a 10-year refinance, you can pay off your house faster and save on interest. However, you should ensure that you are able to afford the higher monthly payment.

When should I refinance?

Generally, refinancing is a good idea if you can obtain a lower interest rate than your current interest rate or if you need to change the term of your loan. Considering other factors, including the length of your loan, the amount of your monthly payment, and how long you intend to stay in your current home, can help you decide whether to refinance. You should also consider fees and closing costs, which can be substantial.

At present, mortgage refinancing rates have reached an all-time high, resulting in a decrease in applicants. If you purchased your home when interest rates were lower than today, refinancing has little financial benefit. Regardless of where interest rates are headed, homeowners should consider refinancing in light of their financial circumstances and goals.