Refinance rates keep rising on Jan. 5, 2022 – CNET
A number of benchmark mortgage refinance rates moved higher today.
Both 15-year fixed and 30-year fixed refinances saw their average rates trend upward. In addition, the average rate on 10-year fixed refinance also moved up.
Refinance interest rates are never set in stone — but rates have been at historic lows. If you plan to refinance your home, now might be a great time to lock in a good rate. Before refinancing, remember to take into account your personal needs and financial situation, and compare offers from different lenders to find the right one for you.
30-year fixed-rate refinance
The average 30-year fixed refinance rate right now is 3.35%, an increase of 13 basis points over this time last week. (A basis point is equivalent to 0.01%.)
Refinancing to a 30-year fixed loan from a shorter loan term can lower your monthly payments. Because of this, a 30-year refinance can be a good idea if you’re having trouble making your monthly payments. In exchange for the lower monthly payments though, rates for a 30-year refinance will typically be higher than 15-year and 10-year refinance rates. You’ll also pay off your loan slower.
15-year fixed-rate refinance
The average rate for a 15-year fixed refinance loan is currently 2.58%, an increase of 13 basis points from what we saw the previous week.
A 15-year fixed refinance will most likely raise your monthly payment compared to a 30-year loan. On the other hand, you’ll save money on interest, since you’ll pay off the loan sooner. You’ll also typically get lower interest rates compared to a 30-year loan. This can help you save even more in the long run.
10-year fixed-rate refinance
For 10-year fixed refinances, the average rate is currently at 2.59%, an increase of 14 basis points over last week.
A 10-year refinance will typically feature the highest monthly payment of all refinance terms, but the lowest interest rate. A 10-year refinance can help you pay off your house much faster and save on interest in the long run. But you should confirm that you can afford a higher monthly payment by evaluating your budget and overall financial situation.
Where rates are headed
We track refinance rate trends using information collected by Bankrate, which is owned by CNET’s parent company. Here’s a table with the average refinance rates supplied by lenders across the country:
Average refinance interest rates
|Product||Rate||A week ago||Change|
|30-year fixed refi||3.35%||3.22%||+0.13|
|15-year fixed refi||2.58%||2.45%||+0.13|
|10-year fixed refi||2.59%||2.45%||+0.14|
Rates as of Jan. 5, 2022.
How to shop for refinance rates
When searching for refinance rates online, it’s important to remember that your specific financial situation will influence the rate you’re offered. Your interest rate will be influenced by market conditions as well as your credit history and application.
To get the best interest rates, you’ll typically need a high credit score, low credit utilization ratio, and a history of making consistent and on-time payments. Researching interest rates online is always a good idea, but you’ll need to connect with a mortgage professional to get your exact refinance rate. And don’t forget about fees and closing costs which may cost a hefty amount upfront.
Since the beginning of the pandemic, a lot of lenders have been stricter stricter with who they approve for a loan. This means that if you don’t have great credit ratings, you might not be able to take advantage of lowered interest rates — or qualify for a refinance in the first place.
To get the best refinance rates, you’ll first want to make your application as strong as possible. If you haven’t already, try to improve your credit by monitoring your credit reports, using credit responsibly, and managing your finances carefully. Also be sure to compare offer from multiple lenders in order to get the best rate.
When should I refinance?
In order for a refinance to make sense, you’ll generally want to get a lower interest rate than your current rate. Aside from interest rates, changing your loan term is another reason to refinance. While interest rates have been low in the past few months, you should look at more than just the market interest rates when deciding if a refinance is right for you.
To decide whether a refinance is right for you, consider all of the factors including how long you plan to stay in your current home, the length of your loan term and the amount of your monthly payment. Also keep in mind that closing costs and other fees may require an upfront investment.
Note that some lenders have tightened their requirements since the beginning of the pandemic. If you don’t have a solid credit score, you may not qualify for the best rate. Refinancing at a lower interest rate can save you money in the long run and help you pay off your loan sooner. But a careful cost-benefit analysis is necessary to confirm that doing so makes sense.
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January 5, 2022 at 06:30AM