Current Mortgage Refinance Rates -- April 16, 2021: Rates Mixed

Check out today's mortgage refinance rates if you're thinking about refinancing your home loan.

On April 16, 2021, average mortgage refinance rates are mixed, with some trending down and others up a bit. Take a look at the average interest rate for the 30-year, 20-year, and 15-year fixed-rate refinance loans so you can see how they compare to the rate on your current home loan:

Data source: The Ascent's national mortgage interest rate tracking.

30-year mortgage refinance rates

The average 30-year mortgage refinance loan rate today is 3.341%, down 0.021% from yesterday's average of 3.362%. A loan at today's average rate would cost you $439 per month in principal and interest for each $100,000 you refinance. Your total interest costs over the life of the refinance loan would equal $57,942 per $100,000 borrowed.

20-year mortgage refinance rates

The average 20-year mortgage refinance loan rate today is 3.116%, up 0.017% from yesterday's average of 3.099%. If you refinance at today's average rate, you'd have a monthly principal and interest payment of $560 per $100,000 borrowed. Total interest costs would be $34,501 per $100,000 in mortgage debt over the life of the refinance loan.

The interest paid over time is much lower on the 20-year loan than the 30-year loan because you won't pay interest for as long (and because the rate is a bit lower). But because you make so many fewer payments, each one must be much higher.

15-year mortgage refinance rates

The average 15-year mortgage refinance loan rate today is 2.612%, down 0.019% from yesterday's average of 2.631%. You'd be looking at a principal and interest payment of $672 per $100,000 refinanced at today's average rate. Over the life of the refinance loan, you'd pay total interest costs of $20,973 per $100,000 borrowed.

The 15-year refinance loan has the lowest interest costs over time of any of the loans on this list. But even with the reduced interest rate compared with the 20-year or 30-year loan, monthly payments are still much higher. This is the tradeoff you have to make to become debt free so fast.

Should you refinance your mortgage right now?

Refinancing your mortgage can be a smart financial decision if you're able to reduce your interest rate and lower your monthly payments by securing a new home loan. However, there are a few key things to think about before you refinance.

First, if you extend your loan repayment term, you could end up paying higher total interest costs over time than with your existing mortgage. This can occur even if you qualify for a lower interest rate since you'd be paying interest over a longer time. You can avoid this issue by choosing a refinance loan with a shorter repayment term. Or you may decide you're willing to pay more interest over the life of your loan in exchange for a reduced monthly payment.

Second, you will have to consider closing costs, which are the upfront fees you're charged when you refinance your mortgage. The Ascent's research revealed that closing costs on a refinance loan for a median value home total anywhere from $5,000 to $12,500. However, your closing fees will depend on the amount of your home loan, your location, and your lender.

You should eventually make up for these closing costs due to your lower monthly payments -- but that can take time. If you save $200 per month by refinancing and pay $6,000 in closing costs, you would take 2.5 years to break even. It's important to do the math and consider whether you'll stay in your home long enough for refinancing to pay off.

In general, it is a good idea to refinance if you don't plan to move in the next few years and you can reduce your mortgage interest rate by 1% or more. With mortgage refinance rates still relatively low, historically speaking, many borrowers will find it's a good time to refinance. Compare rates from the best mortgage refinance lenders to get some personalized offers and decide whether securing a new home loan now is right for you.