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

Check out today's average mortgage refinance rates to see if you should refinance now.

On Sept. 7, 2021, mortgage refinance rates are down for the 15-year and 20-year loan and up for the 30-year. If you are a current homeowner, you should consider monitoring trends in mortgage refinance rates to see if and when refinancing your current loan could be a smart financial move.

Here are today's average rates:

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 3.105%, up 0.003% from yesterday's average of 3.102%. If you refinance at today's average rate, your monthly principal and interest payment would be $427 per $100,000 borrowed. Total interest costs would add up to $53,824 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 2.783%, down 0.007% from yesterday's average of 2.790%. Refinancing at today's average rate would leave you with a monthly principal and interest payment of $544 per $100,000 in mortgage debt. Over the life of the refinance loan, your total interest costs would add up to $30,511 per $100,000 borrowed.

This loan has a lower interest rate than the 30-year, and it can save you a lot of money on your home loan over time because of that low rate and shortened payoff time. However, when you make 120 fewer payments, you must pay a lot more each month to repay your debt on schedule.

15-year mortgage refinance rates

The average 15-year mortgage refinance loan rate today is 2.368%, down 0.003% from yesterday's average of 2.371%. At today's average rate, the monthly principal and interest payment would add up to $661 per $100,000 in refinanced mortgage debt. Your total interest costs over the life of the refinance loan would equal $18,907 per $100,000 borrowed.

With an even shorter repayment time and even lower rate, this loan provides the highest total amount saved over time. However, you will need to be prepared for significantly higher monthly payments because your repayment time is so short.

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 a 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.