March 5, 2024
Mortgage

February 9, 2024—Rates Rise – Forbes Advisor


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The rate on a 30-year fixed refinance jumped today.

The average rate on a 30-year fixed mortgage refinance is 7.40%, according to Curinos, while the average rate on a 15-year mortgage refinance is 6.61%. On a 20-year mortgage refinance, the average rate is 7.25%.

Related: Compare Current Refinance Rates

Refinance Rates for February 9, 2024

30-Year Fixed Refinance Interest Rates

Currently, the average rate for a 30-year, fixed-rate mortgage refinance is 7.40%. That’s compared to 7.15% last week. Borrowers with a 30-year, fixed-rate mortgage of $100,000 will pay $693 per month for principal and interest at the current interest rate of 7.40%, according to the Forbes Advisor mortgage calculator.

Over the life of the loan, the borrower will pay total interest costs of about $149,306. A different way of looking at interest rates is the annual percentage rate, or APR. For a 30-year, fixed-rate mortgage, the APR is 7.46% compared to 7.18% last week. The APR is essentially the all-in cost of the home loan.

20-Year Refinance Interest Rates

For a 20-year fixed refinance mortgage, the average interest rate is currently 7.25% compared to 6.98% at this time last week.

The APR, or annual percentage rate, on a 20-year fixed mortgage is 7.26%. That compares to 7.02% at the same time last week.

At today’s interest rate of 7.25%, a 20-year, fixed-rate mortgage refinance of $100,000 would cost $790 per month in principal and interest—not including taxes and fees. That would equal about $89,647 in total interest over the life of the loan.

15-Year Refinance Interest Rates

For a 15-year fixed refinance mortgage, the average interest rate is currently 6.61% compared to 6.30% at this time last week.

The APR, or annual percentage rate, on a 15-year fixed mortgage is 6.60%. That compares to 6.29% at this time last week.

Using the current interest rate of 6.61%, a 15-year, fixed-rate mortgage refinance of $100,000 would cost $877 per month in principal and interest—not including taxes and fees. That would equal about $57,880 in total interest over the life of the loan.

30-Year Jumbo Refinance Interest Rates

The average interest rate for a 30-year, fixed-rate jumbo mortgage refinance is 7.29%. Last week, the average rate was 7.13%.

Borrowers with a 30-year, fixed-rate jumbo mortgage refinance with today’s interest rate of 7.29% will pay $685 per month in principal and interest on a $100,000 loan.

15-Year Jumbo Refinance Interest Rates

A 15-year, fixed-rate jumbo mortgage refinance is 6.94%, on average, compared to the average of 6.80% last week.

At today’s interest rate of 6.94%, a borrower with a 15-year, fixed-rate jumbo refinance would pay $6,715 per month in principal and interest on a $750,000 loan. Over the life of the loan, that borrower would pay around $458,744 in total interest.

Are Refinance Rates and Mortgage Rates the Same?

No, mortgage refinance rates are typically higher than purchase loan rates due to additional risk for the lender. Cash-out refinance rates are also higher than a standard rate-and-term refinance as you are increasing your loan balance by tapping your equity.

The application process for refinancing a mortgage is similar to getting a home purchase loan regarding the required paperwork and home appraisal. Additionally, similar closing costs from 2% to 6% of the loan amount apply, which is an extra expense.

When you refinance, your new rate is based on current refinance rates and your loan term. This rate replaces your existing mortgage repayment terms.

Know When to Refinance Your Home

You may want to refinance your home when you can lower your interest rate, reduce monthly payments or pay off your mortgage sooner. You may want to use a cash-out finance to access your home’s equity or take out a new loan to eliminate private mortgage insurance (PMI).

A home loan refinance may make sense particularly if you plan to remain in your home for a while. Even if you score a lower interest rate, you need to take the loan costs into consideration. Calculate the break-even point where your savings from a lower interest rate exceed your closing costs by dividing your closing costs by the monthly savings from your new payment.

Our mortgage refinance calculator could help you determine if refinancing is right for you.

Is Now a Good Time To Refinance?

Now may be a good time to refinance if you can reduce your monthly payment by getting a better interest rate or adjusting your repayment period.

While refinance rates are at multi-year highs, you may qualify for a competitive rate if your credit has improved since getting your existing mortgage or by switching to a shorter loan term, such as a 15-year mortgage. Refinancing from a government-backed loan to a conventional loan with at least 20% equity helps you waive private mortgage insurance, FHA mortgage insurance premiums or the USDA guarantee fees.

There are multiple mortgage refinance options to consider and some that let you tap your home equity.

Consider avoiding refinancing if you can’t get a better rate or reduce your monthly payment. Additionally, you will need to pay closing costs and the application process can be lengthy. These hindrances may exceed the potential benefits of refinancing.

How to Qualify for Today’s Best Refinance Rates

Much like when you shopped for a mortgage when purchasing your home, when you refinance here’s how you can find the lowest refinance rate:

  • Maintain a good credit score
  • Consider a shorter-term loan
  • Lower your debt-to-income ratio
  • Monitor mortgage rates

A solid credit score isn’t a guarantee that you’ll get your refinance approved or score the lowest rate, but it could make your path easier. Lenders are also more likely to approve you if you don’t have excessive monthly debt. You also should keep an eye on mortgage rates for various loan terms. They fluctuate frequently, and loans that need to be paid off sooner tend to charge lower interest rates.

Frequently Asked Questions (FAQs)

How soon can you refinance a mortgage?

In many cases, you can refinance a mortgage as soon as six months after you start paying it down, although some lenders insist that you wait 12 months. You should ask your lender to be sure.

How do you find the best refinancing lender?

Our guide to the best mortgage refinance lenders is a good starting point, but make sure you compare multiple lenders and get more than one quote. It’s always a good idea to find out the closing costs lenders charge, and also to make sure you can communicate easily with your lender. Conditions in the housing market change frequently, so being able to depend on your lender is crucial.

How much does it cost to refinance a mortgage?

It can cost as much as 2% to 6% of the full cost of the loan to refinance a mortgage. Make sure to find out the exact closing costs from your lender.



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