Current Mortgage Refinance Rates -- May 20, 2021: Rates Are Mixed

by Christy Bieber | Updated July 19, 2021 - First published on May 20, 2021

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Large, modern-style home with Today's Mortgage Refinance Rates graphic.

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Considering getting a new mortgage? Take a look at today's average refinance rates.

On May 20, 2021, mortgage refinance rates are mixed, with some up and others down a bit. Rates are up from recent lows, but still remain competitive, so many homeowners could potentially save money by refinancing their current loans.

Check out average mortgage refinance rates for May 20 to see if securing a new loan might make sense for you:

Mortgage Type Today's Interest Rate
30-year fixed refinance loan 3.290%
20-year fixed refinance loan 3.085%
15-year fixed refinance loan 2.573%

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 3.290%, up 0.004% from yesterday's average of 3.286%. Refinancing at today's average rate would leave you with a monthly principal and interest payment of $437 per $100,000 in mortgage debt. Total interest costs would add up to $57,466 per $100,000 borrowed over the life of the refinance loan.

20-year mortgage refinance rates

The average 20-year mortgage refinance loan rate today is 3.085%, down 0.014% from yesterday's average of 3.099%. For each $100,000 refinanced at today's average rate, your total monthly principal and interest payment would be $559. Over the life of the refinance loan, you'd pay total interest costs of $34,127 per $100,000 borrowed.

You'll notice that this loan reduces total costs compared with the 30-year loan, but monthly payments are higher. When you make the payoff time shorter you save on interest by not paying it for as long, but must make higher monthly payments to become debt free on schedule.

15-year mortgage refinance rates

The average 15-year mortgage refinance loan rate today is 2.573%, down 0.004% from yesterday's average of 2.577%. If you refinance at today's average rate, you'd have a monthly principal and interest payment of $670 per $100,000 borrowed. Over the life of the refinance loan, your total interest costs would add up to $20,642 per $100,000 borrowed.

With a shorter payoff time than the 30-year or 20-year loan, the 15-year option comes with a much higher monthly payment but maximizes interest savings over time. It's important to consider the tradeoffs when deciding what loan repayment term makes sense for you.

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 not too far off record lows, many borrowers could find it's still 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.

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