Both the 15-year fixed interest rate and the 30-year fixed interest rate saw an increase in average interest rates over the past seven days. The average interest rate on a 10-year fixed refinance has not changed.
At the beginning of the pandemic, refinancing rates reached an all-time low. But in early 2022, the Federal Reserve began raising interest rates to curb high inflation. Although the Fed doesn’t set mortgage rates directly, its series of rate hikes has caused the cost of borrowing to rise for most consumer credit products, including mortgages and refinancing.
After pausing its rate hike campaign in June, the Fed again voted to raise its short-term policy rate, the federal funds rate, by 25 basis points (or 0.25%) at its Federal Open Market Committee meeting on July 26.
Current mortgage rates for August 2023
Mortgage refinancing rates change daily. Experts recommend shopping around to make sure you’re getting the lowest price. By entering your information below, you may receive a customized quote from one of CNET’s partner lenders.
For these tariffs: Bankrate, like CNET, is owned by Red Ventures. This tool offers partner interest rates from lenders that you can use when comparing multiple refinance rates.
According to Krieg Tidemann, an assistant professor of economics at Niagara University, a higher federal funds rate could lead to a slight increase in mortgage rates.
But if inflation continues to fall and the Fed manages to keep interest rates stable — and eventually cut them in 2024 — mortgage rates should fall somewhat. However, a return of interest rates in the 2% to 3% range is unlikely. Unless you’ve bought a home within the last year, it’s unlikely that you’ll save money by refinancing to a lower-rate mortgage.
Regardless of which way interest rates are going, homeowners shouldn’t focus on market timing, but instead should be deciding whether refinancing makes sense for their financial situation. As long as you can get a lower interest rate than your current one, refinancing will likely save you money. Do the math to see if it makes sense for your current finances and goals. When you decide to refinance, be sure to compare interest rates, fees, and the annual percentage rate (APR) — which reflects the total cost of borrowing — from different lenders to find the best deal.
30-year fixed rate refinance
The average 30-year fixed refinancing rate currently stands at 7.62%, up 22 basis points from this time last week. (One basis point equals 0.01%.) A 30-year fixed refinance typically has lower monthly payments than a 15-year or 10-year refinance. If you’re currently struggling to make your monthly payments, a 30-year refinance could be a good option for you. However, interest rates on a 30-year refinance are typically higher than interest rates on a 10- or 15-year refinance. In addition, it will take longer to pay off your loan.
15-year fixed rate refinance
The current average rate on 15-year refinancing is 6.85%, up 9 basis points from what we saw last week. A 15-year fixed refinance will most likely increase your monthly payment compared to a 30-year loan. However, you can also repay your loan faster and save money over the term of the loan. 15-year refinancing rates are typically lower than 30-year refinancing rates, allowing you to save even more over the long term.
10-year fixed rate refinance
The average 10-year fixed refinancing rate is currently 6.83%, unchanged from a week ago. A 10-year refinance typically has the highest monthly payment of any refinance term, but also the lowest interest rate. A 10-year refinance can help you pay off your home much faster and save on interest. However, you should make sure you can afford a higher monthly payment by evaluating your budget and overall financial situation.
Where are prices going
Mortgage rates hit a 20-year high in late 2022, but now the macro environment is changing again. Interest rates fell significantly in January before rising again in February. Mortgage rates have fluctuated between 6.5% and 7% since the beginning of the summer.
Mortgage rates rise and fall daily in response to a variety of economic factors, including inflation, employment and the outlook for the economy in general.
The latest CPI shows that the annual inflation rate for the 12-month period ended June was 3.0%, down sharply from 4.0% in May.
“Unless there is a radical change in inflation trajectories or a recession, it seems unlikely that the Fed will hike rates further after July. That means mortgage rates are likely to be at or near their peak,” Tidemann said.
Mortgage rates are unlikely to fall dramatically anytime soon, but positive signals from the Fed and a slowdown in inflation could alleviate some of the upward pressure on them.
We follow the development of refinancing rates using the information collected by Bankrate. Here is a table of the average refinancing rates provided by lenders across the country:
Average refinancing rates
| Product | Rate | A week ago | Change |
|---|---|---|---|
| 30 year old solid refi | 7,62 % | 7,40 % | +0,22 |
| 15 years solid refi | 6,85 % | 6,76 % | +0,09 |
| 10 year solid refi | 6,83 % | 6,83 % | N/C |
Prices as of August 14, 2023.
How to find refinancing rates
It is important to understand that the fares advertised online often require certain eligibility conditions. Your interest rate will be affected by market conditions as well as your specific credit history, financial profile and application.
A strong credit score, low credit utilization, and a history of regular and timely payments will generally help you get the best interest rates. You can get a good feel for average interest rates online, but be sure to speak with a mortgage professional to find out what specific interest rates you qualify for. In order to get the best refinancing rates, you should first make your application as descriptive as possible. The best way to improve your credit rating is to get your finances in order, use credit responsibly, and monitor your credit regularly. Don’t forget to talk to multiple lenders and do your research.
Refinancing can be a great move if you can get a good interest rate or pay off your loan sooner – but think carefully if it’s the right choice for you at the moment.
When should I refinance?
Most people refinance because market interest rates are lower than their current rates or because they want to change the term of their loan. When deciding whether to refinance, consider factors other than market interest rates, including the length of time you plan to stay in your current home, the length of the loan term, and the amount of your monthly payments. And don’t forget fees and closing costs, which can add up.
As interest rates rose throughout 2022, the number of refinance applicants dwindled. If you bought your home when interest rates were lower than they are now, refinancing your mortgage may not bring you any financial benefit.
Not all messages on the site express the site’s point of view, but we automatically transmit and translate these messages through programmatic technology on the site and not by a human editor
2023-08-14 14:57:02
#Refinancing #rates #August #Rate #hike
