Mortgage Refinance Rates on June 8, 2022: Rates Move Higher
Multiple important mortgage refinance rates ticked up today. Both 15-year fixed and 30-year fixed refinances saw their mean rates go higher. In addition, the average rate on 10-year fixed refinance also saw an increase.
Though refinance rates do fluctuate slightly on a daily basis, homeowners can expect to see rates rise over the course of this year. In recent months, rates have been trending up from historic lows seen during the pandemic, and are now closer to 2018 rate levels. That means if you’re looking to shave dollars and interest off your current monthly mortgage payments, these could be the lowest rates of 2022.
Make sure to think about your goals and circumstances, and compare offers to find a lender who can meet your needs.
30-year fixed-rate refinance
The average 30-year fixed refinance rate right now is 5.54%, an increase of 21 basis points compared to 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. This makes 30-year refinances good for people who are having difficulties making their monthly payments or simply want a bit more breathing room. However, interest rates for a 30-year refinance will typically be higher than rates for a 15-year or 10-year refinance.
It’ll also take you longer to pay off your loan.
15-year fixed-rate refinance
The average rate for a 15-year fixed refinance loan is currently 4.69%, an increase of 8 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. However, you’ll also be able to pay off your loan quicker, saving you money over the life of the loan.
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 average 10-year fixed refinance rate right now is 4.60%, an increase of 9 basis points from what we saw the previous 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.
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
At the start of the pandemic, refinance rates dropped to historic lows, but now interest rates are hovering around pre-pandemic levels. The Federal Reserve recently raised rates for the second time in 2022, and plans to increase them several more times throughout the year. Given this policy, along with strong economic growth and inflation, which reached its highest in four decades, rates are expected to keep going up this year.
While there have been some temporary dips in interest rates, it’s impossible to predict when another drop might occur. That means it’s a good idea to try to take advantage of refinancing now and lock in a decent rate. We track refinance rate trends using data collected by Bankrate, which is owned by CNET’s parent company.
Here’s a table with the average refinance rates reported by lenders across the country:
Average refinance interest rates
| 30-year fixed refi | 5.54% | 5.33% | +0.21 |
| 15-year fixed refi | 4.69% | 4.61% | +0.08 |
| 10-year fixed refi | 4.60% | 4.51% | +0.09 |
Rates as of June 8, 2022.
How to find the best refinance rate
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. 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.
You can generally get a good feel for average interest rates online, but make sure to speak with a mortgage professional in order to see the specific rates you qualify for. You should also take into account any fees and closing costs that might offset the potential savings of a refinance. Since the beginning of the pandemic, a lot of lenders have been stricter with who they approve for a loan.
If you have a low credit score or a poor credit history, you might have trouble getting a refinance at the lowest interest rates. Before applying for a refinance, you should make your application as strong as possible in order to get the best rates available. If you haven’t already, try to improve your credit by monitoring your credit reports, using credit responsibly, and managing your finances carefully.
You should also shop around with multiple lenders and compare offers to make sure you’re getting the best rate.
When to consider a mortgage 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. It’s true that in the past year, interest rates have been at a historic low.
But when deciding whether to refinance, be sure to take into account other factors besides market interest rates. Make sure to consider your goals and financial situation, including how long you plan to stay in your current home. It’s helpful to have a specific goal for a refinance — such as decreasing your monthly payment or adjusting the term of your loan.
And don’t forget about fees and closing costs, which can add up. 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.
