Today’s 15-year refinance rates

Current 15-year refinance rates

By Jeff Ostrowski
Reviewed by Greg McBride, CFA, Chief Financial Analyst for Bankrate

The table below brings together a comprehensive national survey of mortgage lenders to help you know what are the most competitive 15-year refinance rates. This interest rate table is updated daily to give you the most current rates when choosing a 15-year fixed mortgage loan.

Rates as of Wednesday, April 14, 2021 at 6:30 AM

The table above brings together a comprehensive national survey of mortgage lenders to help you know what are the most competitive 15-year refinance interest rates. This interest rate table is updated daily to give you the most current rates when choosing a 15-year refinance home loan.

What is a 15-year fixed-rate refinance mortgage?

Refinancing to a 15-year fixed-rate mortgage can save you money over the long term in two ways. Lenders charge lower interest rates on shorter-term mortgages, reflecting their lower level of risk in extending the loan compared with a typical 30-year loan. Also, since you’re borrowing the money for half as long, you’ll often save tens of thousands of dollars in interest over the life of the mortgage.

However, with a 15-year loan, you’ll have a higher monthly payment. If you can afford the larger payments, refinancing to a 15-year loan can help you reach homeownership sooner while saving you a bundle on interest.

When to consider a 15-year refinance

If you currently have a 30-year mortgage and have room in your budget for a higher monthly mortgage payment, refinancing to a 15-year fixed-rate loan can make good financial sense. You’ll still have the stability of knowing that the monthly payment won’t change, while getting the benefit of a lower interest rate. Plus, you’ll pay off your home faster, freeing up money for other financial goals like saving for retirement when you do. Keep in mind that you need to show the lender that you have enough income to cover a higher payment in order to qualify for the new loan.

On the other hand, if your main goal is to achieve the lowest possible payment, you're better off refinancing to a 20- or 30-year mortgage. While starting fresh with a new long-term loan isn’t the right tactic for everyone, it is an option, especially if you need to trim monthly expenses.

Pros and cons of a 15-year mortgage refinance

Advantages of a 15-year mortgage refinance:

• You’ll fully own your home sooner.
• You’ll save a lot on interest, especially if rates have fallen since you bought the home.
• A larger portion of your monthly payments will go toward the loan principal rather than interest.

Disadvantages of a 15-year mortgage refinance:

• Higher monthly payments compared to longer-term loans due to the shorter repayment period.
• The opportunity cost of tying up money in home equity instead of other financial goals.
• The potential loss of mortgage interest tax breaks due to paying less interest.

Not sure whether to commit to the higher monthly payments? You can mimic the effect of refinancing to a 15-year loan by simply making extra payments on your existing 30-year loan. You’ll pay less interest and shorten the pay off time while still keeping some wiggle room. Should a financial emergency arise, you can revert to your original, lower payment amount for that month, or as long as you need to, without incurring any penalties.

Deciding between a 15-year refi and increasing payments on your existing loan? You can use our Additional Mortgage Payment Calculator to see how extra payments will shorten your pay-off time and lower your interest costs.

When is the best time to refinance into a 15-year mortgage?

When you’ve gotten a raise or two. Say you took a 30-year mortgage five years ago, but your income has risen considerably since then. In that case, it could make sense to refinance into a 15-year loan. Your payments will be higher compared to a 30-year loan, but your higher income will allow you to absorb the new cost and pay down your loan in half the time.

When the monthly payments on a 15-year mortgage won’t be much higher than you’re already paying. This can be especially compelling if your credit score has improved significantly. Say you haven’t refinanced that 30-year loan you took during the rate spike of 2018. Here’s a scenario: If you borrowed $300,000 at 6 percent interest, your monthly payment is $1,799. Rolling the $300,000 balance into a 15-year loan at 2.5 percent would mean a monthly payment of $2,000.

When you're halfway into a 30-year mortgage. Granted, not many people keep loans this long. But in this case, the time could be right for refinancing to a 15-year loan. For one thing, your rate is much higher than you’d pay today. For another, you’ll have a lower principal balance after all those years of repayment.

How to get the best rate

Shopping around is the single most important step you can take before you commit to a mortgage. Rates and closing costs can vary from lender to lender. For ideas, see our reviews of best overall mortgage lenders and best online mortgage lenders. Keep in mind that your credit score is the biggest factor in determining your rate. The best deals go to borrowers with credit scores of 740 or higher. Other considerations include your income and how much you’re putting down or, in the case of a refinance, how much equity you have in the house.

Alternatives to a 15-year refinance

Try a different term. The 30-year and 15-year terms get all the attention, but they’re not the only games in town. A 20-year mortgage speeds up your repayment rate without bumping your payment as dramatically as a 15-year amortization. If you really want to retire that debt, try a 10-year term.

Keep your 30-year loan but make extra payments. Closing costs are a downside to refinancing. If you want to avoid the costs and hassle of a refi, you could keep your 30-year mortgage but speed up your payments. You could put a little more toward the principal each month. Or you could set up automated biweekly payments. This strategy means you essentially make an extra monthly payment over the course of a year. In either scenario, you’ll pay down your principal faster and reach the finish line before 30 years. Make sure to check with your lender that your biweekly payments are being applied correctly.

When to refinance to a 15-year fixed-rate loan from an adjustable-rate mortgage (ARM)

Some people choose an ARM when they purchase their home, perhaps because they didn’t plan to stay in the home for long or needed a low monthly payment to get settled. Priorities can change over time, though. Refinancing to a 15-year fixed-rate loan from your current adjustable-rate mortgage could provide you with stability, predictability and significant savings.

For example, with a 5/1 ARM, the interest rate would reset after five years. That means if the market rate rises, your interest rate and monthly payment would also rise. Since most experts don’t expect mortgage rates to drop significantly from current levels, it could be a good time to refinance to a fixed-rate loan, eliminating the uncertainty and the risk of a rate increase. Choosing a 15-year repayment period would also lower your interest costs and shorten the time to full homeownership.

How much can you potentially save by refinancing?

Refinancing comes with closing costs, just like original mortgages. Closing costs vary, but they can be 2 to 5 percent of the loan amount. On a $100,000 refinance, closing costs of 3 percent would be $3,000 — not an insignificant sum.

You should try to negotiate with your lender to see if the fees can be lowered. The lender may offer to let you fold the closing costs into the loan, so you don’t have to come up with the cash upfront. But that means you’ll also be paying interest on the extra amount. Instead, ask whether the lender would be willing to waive part of the closing costs, such as the application fee or credit check fee. Particularly if you are a repeat customer, you might be able to work out a better deal.

Since the goal of refinancing is saving money, you’ll want to calculate how long it will take you to break even on the closing costs and start realizing actual savings. Our refinance calculator helps you quickly figure how long it will take you to recoup closing costs so you can decide if refinancing is worthwhile.