Today's Mortgage Refinance Rates -- October 7, 2021: Rates Down for Most Loans

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How are mortgage refinancing rates trending on Oct. 7, 2021? Check out average rates for 30-year, 20-year and 15-year fixed-rate refinance loans.

Average mortgage refinance rates are down for two loans and up for one today. Although your individual rate will be affected by your personal financial details, these average rates can give you a good idea of what you would pay if you refinanced your current home loan. Here's what they look like on Thursday, Oct 7:

Mortgage Type Today's Interest Rate
30-year fixed refinance loan 3.250%
20-year fixed refinance loan 2.939%
15-year fixed refinance loan 2.484%

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 3.250%, down 0.001% from yesterday's average of 3.251%. A mortgage refinance loan at today's average interest rate would cost you $435 per $100,000 borrowed. ​​Over the life of the refinance loan, your total interest costs would add up to $56,674 per $100,000 borrowed.

20-year mortgage refinance rates

The average 20-year mortgage refinance loan rate today is 2.939%, down 0.009% from yesterday's average of 2.948%. If you refinance at today's average rate, you'd have a monthly principal and interest payment of $552 per $100,000 borrowed. Total interest costs would add up to $32,372 per $100,000 borrowed over the life of the refinance loan.

You may be surprised the monthly payments are so much higher with this loan than with the 30-year loan, especially as the interest rate is quite a bit lower. But, remember, you're making payments for a decade less time so each payment must be higher to pay your loan balance in full. You will save a lot of money over time, though, due to the short payoff timeline and low rate.

15-year mortgage refinance rates

The average 15-year mortgage refinance loan rate today is 2.484%, up 0.004% from yesterday's average of 2.480%. You'd be looking at a principal and interest payment of $666 per $100,000 refinanced at today's average rate. During your entire loan repayment period, you'd pay total interest costs of $19,887 per $100,000 refinanced.

This loan has even higher monthly payments than the 20-year loan despite its lower rate. But because you repay your loan so quickly, your total interest costs are very low and this loan is considerably cheaper than the 30-year or 20-year refinance options.

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.

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