Jan. 27, 2022: Mortgage refinance rates are still on the uptick

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Deborah Jaffe/Getty

Various mortgage refinance rates went up again today, making some homeowners wonder if it’s still a good time to refinance. There were increases in the average rates for 10-year fixed, 15-year fixed and 30-year fixed refinances, and rates are expected to rise throughout 2022. If you’re in the market for a refi, make sure to first think about your goals and circumstances, and always compare offers to find a lender who can best meet your personal needs.

30-year fixed-rate refinance

The current average interest rate for a 30-year refinance is 3.73%, an increase of 15 basis points from what we saw one week ago. (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. Be aware, though, that interest rates will typically be higher compared to a 15-year or 10-year refinance, and you’ll pay off your loan at a slower rate.

15-year fixed-rate refinance

For 15-year fixed refinances, the average rate is currently at 3.05%, an increase of 15 basis points compared to one week ago. 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. Interest rates for a 15-year refinance also tend to be lower than that of a 30-year refinance, so you’ll save even more in the long run.

10-year fixed-rate refinance

The current average interest rate for a 10-year refinance is 3.00%, an increase of 8 basis points from what we saw the previous week. Compared to a 30-year and 15-year refinance, a 10-year refinance will usually have a lower interest rate but higher monthly payment. A 10-year refinance can help you pay off your house much quicker and save on interest. However, you should analyze your budget and current financial situation to make sure you’ll be able to afford the higher monthly payment.

Where rates are headed

We started 2022 with low refinance rates, but there’s been an uptick recently due to two major factors: inflation and economic growth. That said, rates can always rise and fall for many reasons. The spread of omicron, for instance, kept rates low throughout December and the start of the new year. Overall, rates are expected to go up this year, particularly with the Federal Reserve’s decision to reduce its bond purchases. 

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 US:

Average refinance interest rates

Product Rate A week ago Change
30-year fixed refi 3.73% 3.58% +0.15
15-year fixed refi 3.05% 2.90% +0.15
10-year fixed refi 3.00% 2.92% +0.08

Rates as of Jan. 27, 2022.

How to shop for refinance rates

When looking for refinance rates, know that your specific rate may differ from those advertised online. Your interest rate will be influenced by market conditions as well as your credit history and application.

Having a high credit score, low credit utilization ratio, and a history of consistent and on-time payments will generally help you get the best interest rates. To get your personalized refinance rates, you’ll need to speak with a mortgage professional, as the rates you qualify for may differ from the rates advertised online. You should also take into account any fees and closing costs that might offset the potential savings of a refinance.

It’s also worth noting that in recent months, lenders have been stricter with their requirements. 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.

Before applying for a refinance, you should make your application as strong as possible in order to get the best rates available. The best way to improve your credit ratings is to get your finances in order, use credit responsibly, and monitor your credit regularly. You should also shop around with multiple lenders and compare offers to make sure you’re getting the best rate.

Is now a good time to 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.

A refinance may not always make financial sense. Consider your personal goals and financial circumstances. How long do you plan on staying in your home? Are you refinancing to decrease your monthly payment, pay off your house sooner — or for a combination of reasons? 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 can be a great move if you get a good rate or can pay off your loan sooner — but consider carefully whether it’s the right choice for you.



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