Mortgage refinancing rates fell on all loans on Tuesday, June 29th.
Check out today’s average rates to see if you can save money by refinancing your current home loan:
Refinancing rates for a 30 year mortgage
The average 30-year mortgage refinancing rate today is 3.319%, down 0.004% yesterday’s average 3.323%. If you refinance at today’s average rate, your monthly principal and interest payment will be $ 439 for every $ 100,000. Your total interest expense over the life of your refinancing loan is $ 58,041 for every $ 100,000.
Mortgage refinancing rates for 20 years
The average 20-year mortgage refinancing rate today is 3.070%, down 0.003% from the 3.073% average yesterday. You would look at the principal and interest payments of $ 558 on $ 100,000 refinanced at today’s average rate. The total interest expense is $ 33,946 for every $ 100,000 in mortgage debt over the life of the refinancing loan.
This loan is provided with higher monthly payments than a 30 year refinancing loan, but the interest costs are lower over time. Since you pay off the loan ten years earlier, you will not pay the bank the same interest, but each payment must be higher.
Mortgage refinancing rates for 15 years
The average 15-year mortgage refinancing rate today is 2.627%, down 0.008% from the 2.635% average yesterday. For every $ 100,000 refinanced at today’s average rate, your total monthly principal and interest payments will be $ 673. The total interest cost will be $ 21,101 per $ 100,000 refinanced at today’s average rate.
This loan has the lowest total costs over time, but has much higher monthly payments than a 30 or 20 year loan. If you don’t mind higher payouts and want to maximize your savings, this is the best option.
Should you refinance your mortgage right now?
Refinancing your mortgage can be a smart financial decision if you can lower your interest rate and lower your monthly payments by getting a new home loan. However, there are a few key points to consider before refinancing.
First, if you extend the maturity of your loan, you can pay a higher overall interest expense over time than with your existing mortgage. This can happen even if you are eligible for a lower interest rate, as you will be paying interest for a longer time. You can avoid this problem by choosing a refinancing loan with a shorter maturity. Or, you may decide that you are willing to pay more interest over the life of the loan in exchange for a lower monthly payment.
Second, you will need to factor in closing costs, which are the upfront payments you will pay when refinancing your mortgage. Ascent research found that closing expenses on refinancing loan for an average home value of $ 5,000 to $ 12,500. However, the closing fees will depend on the amount of your home loan, your location, and your lender.
You will eventually have to offset these closing costs with lower monthly payments, but this can take time. If you save $ 200 a month through refinancing and pay $ 6,000 to close the deal, it will take you 2.5 years to pay off. It’s important to calculate and consider whether you will stay in your home long enough for the refinancing to pay off.
In general, refinancing is recommended if you do not plan to move in the next few years and can lower your mortgage interest rate by 1% or more. With mortgage refinancing rates close to record lows, many borrowers will feel that now is a good time to refinance. Compare rates from best mortgage refinance lenders to get personalized offers and decide if a new home loan is right for you.