Current Mortgage Refinance Rates -- August 17, 2021: Rates Down for All Loans

Does it make sense to refinance now? See how rates for mortgage refinance loans are trending on Aug. 17, 2021.

Average mortgage refinance rates are down across the board today. While it can be hard to time exactly when to get a refinance loan, homeowners should still pay attention to how rates are trending so they can get a good idea if it's the right time to refinance their loan.

Check out today's average mortgage refinance rates for Aug. 17, 2021:

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 3.120%, down 0.008% from yesterday's average of 3.128%. If you refinance at today's average rate, your monthly principal and interest payment would be $428 per $100,000 borrowed. Over the life of the refinance loan, total interest costs would be $54,117 per $100,000 in mortgage debt.

20-year mortgage refinance rates

The average 20-year mortgage refinance loan rate today is 2.862%, down 0.001% from yesterday's average of 2.863%. At today's average rate, the monthly principal and interest payment would add up to $548 per $100,000 in refinanced mortgage debt. Total interest costs would add up to $31,463 per $100,000 borrowed over the life of the refinance loan.

Although your monthly payments are higher if you refinance to the 20-year versus the 30-year loan, you save more over time with this loan option. Your savings comes from the fact you don't pay interest for as long, as well as the lower rate.

15-year mortgage refinance rates

The average 15-year mortgage refinance loan rate today is 2.389%, down 0.004% from yesterday's average of 2.393%. You'd be looking at a principal and interest payment of $662 per $100,000 refinanced at today's average rate. The total costs of interest would add up to $19,084 per $100,000 refinanced at today's average rate.

With such a short timeline, the 15-year refinance loan is much cheaper over time than the 30-year or 20-year loan options. But of course when you pay your loan back in half the time, each monthly payment must be higher.

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'll be 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 near record lows, 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.