Today’s 15-year refinance rates

Current 15-year refinance rates

On Saturday, December 05, 2020, according to Bankrate’s latest survey of the nation’s largest refinance lenders, the benchmark 15-year fixed refinance rate is 2.440% with an APR of 2.670%. Meanwhile, the average 15-year fixed jumbo refinance rate is 2.460% with an APR of 2.510%.

Refinance rates continually fluctuate, but for now they are still within a historically low range. Since mortgage experts don’t expect interest rates to drop significantly from current levels, it could be a good time for homeowners to refinance.

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.

Is now the right time to refinance to a 15-year loan?

A variety of factors could motivate your decision to refinance to a 15-year fixed-rate mortgage. If your income has increased since you got your 30-year mortgage, you might want to speed up the timeline to owning your home in full. Or, if interest rates have dropped since you bought your home, you might want to refinance to reduce the total amount of interest that you’ll pay over the life of the loan.

In the current climate of historically low interest rates, 15-year mortgages have become increasingly popular with homeowners. According to the Mortgage Bankers Association, 15-year refinance applications were up nearly 50 percent in the week that ended October 2, compared to the same week in 2019.

If you’ve set your sights on home renovations or repairs are in your plans, a cash-out refinance to a 15-year loan can provide a way to tap the home equity you’ve built up. While you certainly shouldn’t treat your home equity like an ATM, cash-out refis are a lower-cost form of debt compared to credit cards or unsecured loans, which typically have higher rates than 15-year mortgages. It’s prudent to keep the amount of the new mortgage low enough that you can still comfortably afford the monthly payments.

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.

How to find the best fixed-rate refinancing loan

As with any financial product, you don’t want to take the first refinancing deal you’re offered. Each lender sets its own interest rates and fees, so you’ll want to shop around to find the best deal before refinancing. You can quickly compare rates from many lenders with our refinance interest rate table. The table is updated frequently, so you can easily search for the best 15-year fixed-rate loan available for your situation when refinancing your mortgage.

Learn more about specific loan type rates

Loan Type	Purchase Rates	Refinance Rates
The table above links out to loan-specific content to help you learn more about rates by loan type.
30-Year Loan	30-Year Mortgage Rates	30-Year Refinance Rates
20-Year Loan	20-Year Mortgage Rates	20-Year Refinance Rates
15-Year Loan	15-Year Mortgage Rates	15-Year Refinance Rates
10-Year Loan	10-Year Mortgage Rates	10-Year Refinance Rates
FHA Loan	FHA Mortgage Rates	FHA Refinance Rates
30-Year FHA Loan	30-Year FHA Loan Rates	30-Year FHA Refinance Rates
VA Loan	VA Mortgage Rates	VA Refinance Rates
ARM Loan	ARM Mortgage Rates	ARM Refinance Rates
5/1 ARM	5/1 ARM Rates	5/1 Refinance Rates
7/1 ARM	7/1 ARM Rates	7/1 Refinance Rates
10/1 ARM	10/1 ARM Rates	10/1 Refinance Rates
Jumbo Loan	Jumbo Mortgage Rates	Jumbo Refinance Rates
30-Year Jumbo Loan	30-Year Jumbo Loan Rates	30-Year Jumbo Refinance Rates