Compare Current Mortgage Refinance Rates and Lenders
Review current refinance mortgage rates for October 19, 2018. Use the table below to shop refinance rates and fees for lenders near you. Input your loan amount and property value in the refine your search menu to compare updated interest rates, APRs, and monthly payments to determine how much you can save by refinancing. We recommend that you compare your current mortgage payment to the mortgage payment and fee information presented in the table to understand how long it would take to recover your closing costs if you refinance.
You can also compare mortgage refinance rates and loan payments for different lenders, loan programs and mortgage lengths to determine if you should change your lender and program when you refinance. For example, borrowers with a variable rate loan may want to lock-in a fixed rate mortgage. Or maybe refinancing with a new lender enables you to qualify for a specific mortgage program that reduces your monthly payment. Contacting at least five lenders in the table below enables you to find the refinance terms, lender and loan program that best meet your needs.
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Reasons to Refinance Your Mortgage
Lower Your Interest Rate.
As a rule of thumb, if you are refinancing, your new interest rate should be at least .75% lower than your existing interest rate to justify the refinance closing costs (if any). Additionally, your lower monthly mortgage payment should enable you to recover your mortgage closing costs, or breakeven, within two and a half years. Refinance mortgage rates tend to be slightly lower than home purchase loan rates which can help borrowers save money on their mortgage.
Reduce Your Mortgage Term.
Shortening your mortgage term when you refinance allows you to lower your mortgage rate. For example, the interest rate on a 15 year mortgage is typically .5% - 1.0% less than the interest rate on a 30 year mortgage. A mortgage with a shorter term and lower interest rate results in significantly less total interest expense over the course of the mortgage. For example, a $250,000 15 year mortgage with a 2.750% interest rate saves a borrower approximately $100,000 in total interest expense as compared to a 30 year mortgage with a 3.500% interest rate.
Change Your Mortgage Program.
Refinancing your mortgage also enables you to change your mortgage program. For example, borrowers with an adjustable rate mortgage or interest only mortgage may refinance into a fixed rate mortgage if they are concerned interest rates will increase in the future. Alternatively, borrowers could decide to refinance a fixed rate mortgage into an adjustable rate mortgage to lower their current interest rate or if they believe interest rates will decline in the future.
Take Cash Out of Your Home.
Borrowers can use a cash-out refinance to access the equity in their homes. With a cash-out refinance your new mortgage amount is greater than your current mortgage balance and you keep the difference, less any closing costs, when the refinance closes. Borrowers can use the proceeds from a cash-out refinance for a multitude of purposes including to pay for a remodeling project or college tuition. Please note that refinance mortgage rates for cash-out loans are usually higher than for standard refinancings.
Don’t Be Afraid to Change Lenders When You Refinance.
There is usually no inherent advantage to working with your current lender and we recommend that you use our rate table to shop multiple lenders to decide if you should refinance your mortgage. Your current lender may offer the best refinance terms but you do not know that unless you shop around. Comparing multiple lenders can save you money in the long run and you may learn about mortgage programs that better match your financial and personal goals. Whether it is with your current lender or a new one, when you refinance your primary objectives should be to find the best loan terms and work with a lender that you are confident can deliver.
Lenders Prefer Refinance Borrowers
Don’t get us wrong -- most lenders love any borrower -- but it is usually easier for lenders to process and close refinances than home purchase loans. Refinance applicants have been through the mortgage process before which usually makes them easier for the lender to manage. Additionally, if you are refinancing your loan you usually have made your monthly payments on-time and your credit score is in pretty good shape, which is another plus for lenders. This is one of the reasons why some lenders offer more favorable mortgage terms on refinances. In short, because refinance borrowers are sought after by lenders, they may have more leverage when they negotiate their mortgage rate and fees, which can save you money upfront and in the long run.
Mortgage Rates by Loan Product
Mortgage Rate ReportFriday, October 19, 2018
Mortgage rates moved higher this week as stock market volatility pushed bond yields higher. When the stock market drops, bond yields typically increase which applies upward pressure on mortgage rates, which we saw this week. Ironically, investor concerns over rising interests rates is one of the main factors that led to the equity market sell-off. Rates continue to increase following the Federal Reserve's decision to increase the Federal Funds rate 0.250% to a target range of 2.000% to 2.250% at its September meeting.
The rate hike was the Fed's third of the year as it implements a more aggressive monetary policy in response to a strong economy and labor market. The Fed also reinforced its plan to raise interest rates at least one more time before the end of 2018 and removed language that described its policy as "accommodative" from the meeting statement. The Fed's September meeting statement highlighted strong economic growth including a robust jobs market, household spending, business investment and inflation that is approaching targeted levels. These factors outweigh economic concerns previously identified by the Fed including the impact of a trade tariffs, sluggish wage growth and a slowdown in the housing market.
In implementing its interest rate strategy, it is clear that the Fed is more focused on a robust labor market and accelerating inflation than stalling home sales and prices. Supporting the Fed's outlook, the unemployment rate recently fell to its lowest level an almost five decades despite lower than expected job creation.
Although the housing market continues to be battered by a lack of affordable inventory, higher mortgage rates and a pullback in home construction -- all of which the Fed has acknowledged in recent comments -- the overall direction of the economy is offering no reason for the Fed to change its course on rates. The Fed's actions and consistently bullish signaling pushed mortgage rates to an eight-year high this week.
The interest rate for a 30 year fixed rate mortgage increased 0.125% to 4.750% and the rate for a 15 year fixed rate mortgage moved 0.125% higher to 4.250%. The interest rate on a 5/1 adjustable rate mortgage (ARM) also jumped 0.125% to 4.250%. Jumbo mortgage rates inched up 0.125% to 4.750%, inline with conforming loans. After climbing over much of the past month non-owner occupied mortgage rates reached the key 5.000% level. Providing some relief for borrowers, FHA mortgage rates and VA mortgage rates both remained steady at 4.250%, with both programs appealing to borrowers focused on low or no down payment programs, especially first-time home buyers.
The Fed had clearly communicated its plan to raise rates at its September meeting so few were surprised by the decision as well as the subsequent uptick in mortgage rates. Most signs -- including perhaps most important, the Fed's actions and words -- point to higher rates in the future, although borrowers should expect fluctuations in the near term. While interest rates are impossible to predict, prospective borrowers looking to buy a home or refinance should take advantage of any market pullbacks and may be able to lock in a lower rate by acting sooner rather than later. As lenders react differently to dynamic market conditions, we have also seen much wider variation in mortgage rate pricing, which means borrowers benefit more by shopping multiple lenders.
Because rates change constantly, we continue to actively monitor the mortgage market for new developments. Borrowers should check the FREEandCLEAR rate tables regularly to review personalized, updated mortgage rates for lenders in their area. Our rate tables are free to use and require no personal information.
Why Borrowers Compare Refinance Mortgage Rates on FREEandCLEAR
Comparing refinance mortgage rates can save you thousands. Use our rate tables to find the lender offering the lowest rates and fees
Our rate tables put you in control. You can compare lenders anonymously plus you never need to provide your social security number
Review refinance mortgage rates from leading lenders. Our lenders offer highly competitive terms to win your mortgage business
More FREEandCLEAR Mortgage Resources
Our Mortgage Refinance, Cash-Out, Debt Consolidation or Bi-Weekly refinance calculators enable you to evaluate different refinance scenarios and determine how much money you can save by refinancing
Our comprehensive mortgage refinance guide takes you through the refinance process from start to finish
Refinancing your mortgage is only one option for taking cash out of your home. We review all your cash-out alternatives and provide pros and cons so that you can select the option that is right for you
Make sure all your questions are answered before you start the refinance process. Submit your refinance queries to the FREEandCLEAR Mortgage Expert and receive a thorough answer within 24 hours