Today's Mortgage Refinance Rates -- March 18, 2021: Rates Continue Upward Trend

Mortgage refinance rate went up again on March 18. If you're thinking about refinancing, take a look at today's average rates.

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If you're considering refinancing, it typically makes sense to do so only if you can drop your interest rate. So it's important to keep tabs on mortgage refinance rates. These rates have been trending up from recent record lows, but are still fairly competitive compared with historical norms.

Check out average mortgage refinance rates on March 18, 2021 to see how today's rates compare to the interest you're currently being charged on your 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 3.353%, up 0.017% from yesterday's average of 3.336%. At today's average rate, you'd pay $441 per month in principal and interest per $100,000 refinanced. Total interest costs would add up to $58,717 per $100,000 refinanced over the life of the loan.

20-year mortgage refinance rates

The average 20-year mortgage refinance loan rate today is 3.051%, up 0.006% from yesterday's average of 3.045%. If you refinance at today's average rate, your monthly principal and interest payment would be $557 per $100,000 borrowed. Over the life of the refinance loan, your total interest costs would add up to $33,645 per $100,000 borrowed.

Refinance loans with shorter timelines have lower total interest costs than those with longer payoff times. That's because you won't pay interest for as long. Unfortunately, although the 20-year loan has a lower rate than the 30-year loan, the shortened payoff timeline still means you'll have much higher monthly payments. This tradeoff may be worth it, though, since your loan costs so much less over time.

15-year mortgage refinance rates

The average 15-year mortgage refinance loan rate today is 2.653%, up 0.116% from yesterday's average of 2.637%. A refinance loan at today's average rate would come with a monthly principal and interest payment of $674 per $100,000 borrowed. You'd be looking at total interest costs of $21,323 per $100,000 in mortgage debt over the life of the loan.

The interest rate is much lower on a 15-year refinance loan than on the 20-year or 30-year, but payments are still higher -- again, because of that shortened payoff timeline. The interest savings is considerable, though, and you'll be debt free in half the time compared with a 30-year loan if you choose this option.

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 have to pay 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.