Refinance Mortgage Rates Today: Your Texas Guide

It’s easy to assume refinancing is only for people with perfect credit and tons of home equity. Maybe you’ve seen the refinance mortgage rates today and thought they were out of reach because your financial situation isn’t flawless. I’m here to tell you that’s often not the case. Many homeowners count themselves out too early, not realizing that there are flexible loan programs designed for a wide range of circumstances. Whether your credit score has seen better days or you haven’t hit that 20% equity mark, options like an FHA loan could be a perfect fit. Let’s explore the real factors that determine your rate and find a path forward that works for you.

Key Takeaways

Refinance for your goals, not the market: The right time to refinance is when it helps you lower your payment, shorten your term, or access cash. Calculate your break-even point by dividing closing costs by your monthly savings to confirm the decision is profitable for you.
Your financial health shapes your rate: Lenders look at your credit score, loan-to-value (LTV), and debt-to-income (DTI) ratio to set your interest rate. Improving these personal metrics is the most effective way to qualify for a better offer.
Look beyond the interest rate: When comparing lenders, analyze the entire loan estimate, including origination fees and closing costs. Also, check your current loan for prepayment penalties to avoid unexpected expenses that could cancel out your savings.

What Are Today’s Refinance Rates?

When you start looking into refinancing, the first question on your mind is probably about the interest rates. It’s smart to have a pulse on the market, but it’s also important to remember that the rates you see advertised are national averages. They are a great starting point, but they aren’t a personalized quote. Think of them as a benchmark to help you understand the current lending environment.

The actual interest rate you can get depends on several factors we’ll cover later, including your credit score, home equity, and the type of loan you choose. Rates change daily based on economic factors, so the numbers you see one day might be different the next. The key is to understand the different types of refinance loans available and see which one aligns with your financial goals. Whether you’re looking for the stability of a fixed rate or the lower initial payments of an ARM, there’s a structure that can fit your needs. These rates apply to different types of loans, including a cash-out refinance if you’re looking to tap into your home’s equity.

Let’s look at the most common refinance options and the recent average rates to give you a clearer picture of what to expect.

30-Year Fixed Refinance

The 30-year fixed refinance is one of the most popular choices for homeowners, and for good reason. It offers a stable interest rate that won’t change for the entire 30-year life of the loan. This means your principal and interest payment will be the same every month, making it easy to budget. To give you an idea, recent data shows the average current refinance rate for a 30-year fixed loan at 6.93%. While this longer term means you’ll pay more in interest over time compared to a shorter loan, the lower monthly payment can provide valuable breathing room in your budget. This option is ideal if you plan to stay in your home long-term and prioritize predictable payments.

15-Year Fixed Refinance

If your goal is to pay off your mortgage faster and save a significant amount on interest, a 15-year fixed refinance might be the perfect fit. The interest rates on 15-year loans are typically lower than on 30-year loans; for example, recent averages sit around 6.25%. The trade-off is a higher monthly payment because you’re paying the loan off in half the time. However, the long-term savings can be substantial. This is an excellent choice for homeowners who are comfortable with a higher payment and want to build equity more quickly. It puts you on the fast track to owning your home outright, which is a pretty amazing feeling.

Adjustable-Rate Mortgage (ARM) Refinance

An adjustable-rate mortgage, or ARM, offers a different approach. With an ARM, you get a lower, fixed interest rate for an initial period, usually 5, 7, or 10 years. After that introductory period ends, your refinance rate can change periodically based on market conditions. This can be a great strategy if you want to take advantage of a lower initial payment. However, it comes with the risk that your rate and payment could increase in the future. An ARM can be a smart move for homeowners who don’t plan on staying in their home long-term and can sell or refinance before the fixed-rate period ends.

What Influences Refinance Mortgage Rates?

Have you ever watched mortgage rates tick up and down and wondered what’s behind the changes? It’s not as random as it might seem. Refinance rates are tied to the health of the entire economy. While you can’t control these large-scale factors, understanding them can help you feel more confident about your decision to refinance. Think of it as knowing the weather forecast before you plan a big outdoor event. Let’s look at the three main forces that shape the interest rates lenders offer.

Federal Policies and Inflation

The Federal Reserve, or the Fed, plays a huge role in the economy. While the Fed doesn’t directly set mortgage rates, its policies create a ripple effect that lenders feel. The Fed’s main job is to keep inflation stable and employment high. When inflation (the rate at which prices for goods and services rise) gets too high, the Fed often increases the federal funds rate. This makes it more expensive for banks to borrow money, and they pass those higher costs on to consumers in the form of higher interest rates on products like mortgages. Conversely, when the Fed wants to stimulate the economy, it may lower its rate, which typically leads to lower mortgage rates.

The 10-Year Treasury Yield

If you want a reliable indicator of where mortgage rates are heading, look no further than the 10-year Treasury yield. This is the return an investor gets for loaning the U.S. government money for ten years. Mortgage rates tend to follow the direction of this yield very closely. Typically, the 30-year fixed mortgage rate sits about 1.5 to 2 percentage points above the 10-year Treasury yield. When investors feel there’s more risk in the market, that gap can widen, making mortgages more expensive. Watching the 10-year Treasury yield can give you a sneak peek into the future of refinance rates.

Market Demand and Lender Competition

The simple principle of supply and demand also applies to mortgages. When the economy is strong and many people are looking to buy or refinance homes, lenders may raise rates. On the other hand, the mortgage industry is competitive. Lenders are all vying for your business, and this competition can help keep rates in check. An experienced loan officer can help you find the most competitive offers available in the current market. Whether you’re considering a simple rate-and-term adjustment or a cash-out refinance, shopping around with different lenders is one of the most effective ways to secure a favorable rate.

Is Now the Right Time to Refinance?

Deciding whether to refinance your mortgage can feel like trying to predict the weather. You see rates go up and down, hear conflicting advice, and wonder if you should act now or wait for a better opportunity. The truth is, the “right time” to refinance is less about timing the market perfectly and more about what makes sense for your personal financial goals. It’s a strategic move that, when done for the right reasons, can improve your financial health for years to come.

So, how do you know if the timing is right for you? Let’s look at the key signs that point to yes, a few reasons you might want to wait, and how to do the math to make sure it’s a smart decision.

Signs It’s a Good Idea to Refinance

Refinancing can be a great move if your goal is to improve your financial situation. One of the most common reasons to refinance is to secure a lower interest rate, which can reduce your monthly payment and save you a significant amount of money over the life of your loan. You might also consider refinancing to change your loan term, like switching from a 30-year to a 15-year mortgage to pay it off faster. On the other hand, if you need to free up cash, a cash-out refinance lets you tap into your home’s equity for things like home renovations or consolidating high-interest debt. It’s also a smart move if your home’s value has increased enough to let you remove private mortgage insurance (PMI).

When You Should Consider Waiting

While refinancing has its perks, it isn’t always the right call. If current interest rates aren’t much lower than what you already have, the savings might not be enough to justify the closing costs. You should also pause if you think you might sell your home in the next few years. Refinancing costs money upfront, and if you move before your monthly savings cover those costs, you’ll end up losing money on the deal. Another reason to wait is if your credit score has taken a dip, as this will likely result in a higher interest rate. And while it’s tempting to wait for rates to hit rock bottom, trying to time the market is a gamble that rarely pays off. As the Consumer Financial Protection Bureau has noted, rates are always in flux, so waiting for a perfect number could mean missing out on a good one.

How to Calculate Your Break-Even Point

Before you commit to refinancing, you need to find your break-even point. This is the moment when the money you’ve saved with your new, lower monthly payment equals the amount you paid in closing costs. To figure this out, just divide your total closing costs by your monthly savings. For example, if your closing costs are $5,000 and you’ll save $200 per month, your break-even point is 25 months ($5,000 / $200). If you plan to stay in your home longer than that, refinancing is likely a good financial decision. If you might move sooner, it’s best to hold off. A good lender will provide a detailed loan estimate that breaks down all the rates and fees, making this calculation straightforward.

Your Refinance Loan Options in Texas

Once you’ve decided that refinancing makes sense for your financial picture, the next step is figuring out which type of loan fits your goals. In Texas, you have several great options, and the right one for you depends on what you want to achieve. Are you hoping to lower your monthly payment, pay off your house faster, or maybe tap into your home’s equity for a big project? Each path offers different benefits.

Understanding these choices is the key to making a smart move that will serve you well for years to come. Some loans are designed for pure savings, while others help you leverage your home as a financial tool. There are also specialized government-backed programs that make refinancing simpler for those with existing FHA or VA loans. Let’s walk through the most common refinance loans available so you can feel confident about your decision.

Rate-and-Term Refinance

A rate-and-term refinance is the most straightforward option. Think of it as swapping your current mortgage for a new one with better conditions. The main goal here is to either secure a lower interest rate, which reduces your monthly payment, or shorten your loan term to pay off your mortgage faster. This is a great choice if you’re happy with your home but want to improve your loan’s financial structure. You aren’t taking out any additional cash; you’re simply replacing your existing loan balance with a new, more favorable one. It’s an effective strategy for long-term savings and building equity more quickly.

Cash-Out Refinance

If you need access to funds for a major expense, a cash-out refinance could be the perfect fit. This option allows you to tap into your home’s equity by refinancing for more than you currently owe and receiving the difference as a tax-free lump sum of cash. Homeowners often use these funds for home improvements, consolidating high-interest debt, or covering education costs. While your loan balance will increase, you gain access to capital at a much lower interest rate than personal loans or credit cards. It’s a powerful way to make your home’s value work for you and finance your next big goal.

FHA Streamline Refinance

For homeowners who already have an FHA loan, the FHA Streamline Refinance program offers a simplified path to a lower interest rate and monthly payment. The “streamline” name says it all: this process is designed to be faster and easier, with less documentation and underwriting than a traditional refinance. In many cases, a new home appraisal isn’t even required. The primary requirement is that the refinance must result in a “net tangible benefit,” meaning you must see a clear financial advantage, like a significant reduction in your payment. It’s an accessible option for making your FHA-backed mortgage more affordable.

VA Interest Rate Reduction Refinance Loan (IRRRL)

The VA IRRRL, often called a “VA Streamline,” is an exclusive benefit for eligible veterans, servicemembers, and surviving spouses who have an existing VA loan. Its purpose is to help you refinance into a lower interest rate, reducing your monthly mortgage payment. One of the biggest advantages of an IRRRL is its simplicity. It typically requires no appraisal or credit underwriting package, and you can often roll the closing costs into the loan amount, resulting in no out-of-pocket expenses. This loan makes it incredibly straightforward to take advantage of lower rates while keeping the powerful benefits of your VA loan.

What Are the Costs of Refinancing?

Refinancing your mortgage isn’t free, but the costs can be a smart investment if the move saves you money in the long run. When you refinance, you’ll encounter closing costs, much like you did with your original home loan. These fees cover the lender’s expenses for creating the new loan, including everything from the appraisal to the title search.

So, what should you budget for? Typically, refinancing costs run between 2% and 5% of your total loan amount. For a $300,000 loan, that means you could expect to pay anywhere from $6,000 to $15,000. While that number might seem high, remember that the goal is for the long-term savings from a lower interest rate to far outweigh these initial expenses. Understanding exactly what these costs are, how you can pay for them, and how they affect your overall savings is the key to making a confident decision. We can help you get a clear picture of the numbers with a personalized loan estimate.

A Breakdown of Closing Costs

Closing costs are a collection of individual fees required to finalize your refinance. While the exact charges can vary, most homeowners will see similar items on their closing statement. Think of it as paying for the team of professionals who make your new loan happen.

Common closing costs include:

Application Fee: Covers the initial cost of processing your request.
Appraisal Fee: Pays for a professional appraisal to confirm your home’s current market value.
Title Search and Insurance: Ensures there are no other claims on your property and protects you and the lender from future disputes.
Attorney or Closing Fees: Covers the legal work and coordination of the final transaction.
Origination Fee: A charge from the lender for creating the loan.

Should You Roll Costs Into Your Loan or Pay Upfront?

You have two main options for handling closing costs: pay them out-of-pocket at closing or roll them into your new loan balance. Paying upfront means you won’t pay interest on those costs, which saves you money over the life of the loan. However, it requires having a significant amount of cash on hand.

Rolling the costs into your loan is a popular choice because it requires no immediate cash. The fees are simply added to your principal balance. While this increases your total loan amount and the interest you’ll pay over time, it makes refinancing accessible even if you don’t have thousands of dollars saved. A word of caution: if you’re considering a cash-out refinance to consolidate debt, it’s wise to think through the strategy of turning unsecured debt into secured debt against your home.

How Closing Costs Impact Your Savings

To figure out if refinancing is truly worth it, you need to calculate your break-even point. This is the moment when your monthly savings have completely covered your closing costs. After this point, all the savings go directly into your pocket.

Here’s a simple way to calculate it: Divide your total closing costs by your monthly savings. For example, if your closing costs are $6,000 and your new, lower payment saves you $200 per month, your break-even point is 30 months ($6,000 / $200 = 30). If you plan to stay in your home longer than 30 months, refinancing is a great financial move. However, if you think you might sell before you reach that point, you could lose money on the deal.

Texas Refinancing Rules to Know

Refinancing your mortgage in Texas comes with its own set of guidelines, but don’t let that intimidate you. Think of them less as hurdles and more as signposts that help you make a smart financial decision. Understanding these rules ahead of time ensures you’re prepared for the process and can move forward with confidence. The three main areas to be aware of are the state’s unique take on loan-to-value ratios, the standard regulations around closing costs, and the possibility of prepayment penalties on your current loan.

While some rules are set in stone, many have nuances that can work in your favor, especially when you have an expert on your side. For example, Texas has specific regulations around cash-out refinance loans that differ from other types of refinancing. Knowing these details can help you choose the right path for your financial goals, whether you’re aiming for a lower interest rate, a shorter loan term, or tapping into your home’s equity. We’ll break down exactly what you need to know about each of these key rules.

The 80% Loan-to-Value Rule

You may have heard that you need at least 20% equity in your home to refinance, which corresponds to an 80% loan-to-value (LTV) ratio. While that’s a common benchmark, it’s not a strict requirement for every situation in Texas. Recent changes have created more flexibility, making it possible for homeowners to refinance even if they have less equity built up. This is great news if you bought your home recently or if market values have shifted. Don’t count yourself out just because you haven’t hit that 20% milestone. Your specific circumstances and the type of loan you’re seeking will determine your options.

Closing Cost Regulations

Just like when you bought your home, refinancing involves closing costs. These are the fees paid to third parties to finalize the loan. A consumer’s guide from the Federal Reserve explains that these expenses are a standard part of the process and typically include things like appraisal fees, title insurance, and attorney fees. In Texas, these costs are regulated to ensure fairness, but they are an unavoidable part of the budget. It’s important to review the Loan Estimate you receive from your lender, which will provide a detailed breakdown of these costs so you know exactly what to expect. You can often choose to pay them out-of-pocket or roll them into your new loan balance.

Understanding Prepayment Penalties

Before you get too far into the refinancing process, it’s wise to check if your current mortgage has a prepayment penalty. This is a fee that some lenders charge if you pay off your loan ahead of schedule, which is exactly what you do when you refinance. These penalties can sometimes be costly enough to offset the savings you’d get from a new, lower interest rate. You can find this information in your original loan documents or by calling your current lender. Knowing this upfront can prevent any expensive surprises and helps you accurately calculate whether refinancing is the right move for you right now.

What Factors Determine Your Refinance Rate?

While broad economic trends set the stage for mortgage rates, the specific rate you’re offered is deeply personal. Lenders look at your individual financial picture to determine how much risk they’re taking on by lending to you. Think of it like a financial health check-up. The better your numbers look, the better your rate will be.

The good news is that you have a degree of control over these factors. By understanding what lenders are looking for, you can take steps to put your best foot forward. The four main elements that will shape your refinance rate are your credit score, your home’s loan-to-value ratio, your debt-to-income ratio, and the amount of equity you have. Getting a handle on these areas is the most effective way to prepare for a refinance and secure a rate that saves you money. With over 20 years of experience, our team at Josh Moody Loans can help you assess these factors and find the right path forward.

Your Credit Score

Your credit score is one of the most significant factors lenders consider. It’s a quick snapshot of your history with borrowing and repaying money. A higher score shows lenders that you are a reliable borrower, which reduces their risk and often results in a lower interest rate. Generally, homeowners with credit scores above 760 tend to qualify for the very best rates available.

Don’t worry if your score isn’t in the top tier. While a higher score is helpful, there are many refinance programs available for borrowers with a wide range of credit profiles. We specialize in finding solutions for various situations, so even if your credit has seen better days, we can explore options like an FHA loan that may be a great fit.

Loan-to-Value (LTV) Ratio

Your loan-to-value (LTV) ratio compares the amount of money you’re borrowing to the appraised value of your home. To calculate it, you simply divide your loan amount by your home’s value. For example, if you owe $200,000 on a home that’s worth $250,000, your LTV is 80%.

From a lender’s perspective, a lower LTV is less risky. It means you have more equity (or skin in the game), making you less likely to default on the loan. An LTV of 80% or less is often the sweet spot for securing a competitive interest rate and avoiding private mortgage insurance (PMI). If you’re considering a cash-out refinance, your LTV will be a key part of determining how much you can borrow.

Debt-to-Income (DTI) Ratio

Your debt-to-income (DTI) ratio is another key metric lenders use to assess your financial stability. It’s the percentage of your gross monthly income that goes toward paying your monthly debt obligations, like car payments, student loans, and credit card bills. Lenders want to see that you have enough income left over each month to comfortably afford your new mortgage payment.

Most lenders prefer a DTI ratio of 36% or less, though some loan programs allow for higher ratios. If your DTI is on the higher side, you might consider paying down some of your smaller debts before applying for a refinance. This can improve your financial profile and increase your chances of getting approved with a favorable rate.

Your Home’s Equity

Your home equity is the portion of your home that you own outright. It’s your home’s current market value minus what you still owe on your mortgage. While equity is directly related to your LTV, it’s worth looking at on its own because of a common myth: many people believe you need at least 20% equity to refinance.

While 20% equity is the benchmark for a conventional refinance and helps you avoid PMI, it’s not always a strict requirement. There are several government-backed programs designed to help homeowners with lower equity. For instance, an FHA loan can be a fantastic option for those with less equity built up. The key is to explore all your options instead of assuming you don’t qualify.

Why You Should Compare Lenders

When you’re ready to refinance, it’s easy to feel a sense of urgency and want to jump on the first offer you see. But taking a little extra time to compare your options is one of the most important financial decisions you can make. Looking at different lenders side-by-side ensures you find the best possible deal for your specific situation, not just the most convenient one. It’s about finding a loan that saves you money and a lending partner you can trust for the journey ahead.

The Importance of Shopping Around

Think of refinancing your mortgage like any other major purchase. You wouldn’t buy the first car you test drive without seeing what other dealerships can offer. The same principle applies here, but the stakes are much higher. Failing to compare offers can cost you tens of thousands of dollars over the life of your loan. According to the Consumer Financial Protection Bureau, many homeowners don’t shop around, which often means they pay more than they have to. Getting quotes from at least three different lenders gives you the negotiating power to secure a lower rate and better terms, putting you in control of your financial future.

What to Look For Besides the Interest Rate

While a low interest rate is what catches your eye, it doesn’t tell the whole story of a loan offer. The best deal is about the total package. As you compare lenders, look closely at the Loan Estimate for lender fees, such as origination, underwriting, and application fees, as these can vary significantly. You should also consider the loan terms and whether the lender offers the specific product you need, like a Cash-Out Refinance or an FHA Streamline. Finally, don’t underestimate the value of great service. The right loan officer is an experienced guide who answers your questions clearly and makes the entire process feel manageable. The cheapest offer isn’t always the best one if it comes with poor communication and stressful delays.

Common Refinancing Mistakes to Avoid

Refinancing your mortgage can be a brilliant financial move, but the process has a few potential pitfalls. Making an informed decision means knowing what to look out for. When you understand the common slip-ups, you can approach your refinance with confidence and make sure the new loan truly works for you and your financial goals. Let’s walk through some of the most frequent mistakes homeowners make so you can sidestep them entirely. Being prepared is the best way to ensure your refinance journey is smooth and successful.

Forgetting About Closing Costs

It’s easy to get excited about a lower interest rate, but remember that refinancing isn’t free. Just like with your original mortgage, a refinance comes with closing costs. These fees typically range from 2% to 5% of your new loan amount and can include appraisal fees, title insurance, and lender origination fees. Refinancing involves costs, so it’s important to figure out if the savings will be worth it over time. You’ll want to calculate your break-even point, which is the month you’ll start seeing real savings after covering the initial costs. A cash-out refinance can be a great tool, but only if the numbers make sense for your situation.

Focusing Only on the Monthly Payment

A lower monthly payment is often the main goal of refinancing, but it shouldn’t be your only focus. Sometimes, a lower payment is achieved by extending your loan term, which could mean you end up paying more in interest over the life of the loan. For example, if you’re ten years into a 30-year mortgage and refinance into a new 30-year loan, you’re resetting the clock. While your payment might drop, you’ll be paying on your home for a total of 40 years. If your goal is long-term savings, pay close attention to the total interest you’ll pay with the new loan compared to your current one.

Not Comparing Different Lenders

You wouldn’t buy the first car you test drive, and the same principle applies to mortgages. It’s so important to compare offers from at least three different lenders to find the best rate and terms. Each lender has its own overhead and pricing structure, so rates and fees can vary significantly. Shopping around empowers you to find the most competitive offer and avoid overpaying. Beyond the rate, consider a lender’s reputation for customer service and transparency. Checking a lender’s client reviews can give you a clear picture of the experience you can expect and help you find a partner you can trust.

Overlooking Your Current Loan’s Prepayment Penalty

Before you get too far in the refinancing process, take a moment to review your current mortgage documents. Some loans include a prepayment penalty, which is a fee for paying off your mortgage ahead of schedule. This clause is designed to protect the lender’s expected profit from interest payments. If your loan has one, this fee could eat into, or even erase, your potential savings from refinancing. You can check for prepayment penalties by looking at your closing disclosure or other loan paperwork. Knowing this upfront will prevent any costly surprises down the road.

Find Your Best Refinance Option with Josh Moody Loans

When you start thinking about refinancing, it’s easy to feel overwhelmed by all the choices. But taking the time to compare your options is one of the smartest financial moves you can make. Many homeowners stick with the first offer they see, potentially leaving thousands of dollars on the table over the life of their loan. The right refinance plan can help you lower your monthly payment, pay off your mortgage faster, or even tap into your home’s value for other goals.

This is where having an expert in your corner makes all the difference. At Josh Moody Loans, we don’t just show you a list of rates. With over 20 years of experience helping Texas families, we take the time to understand your specific situation. We’ll look at your property value, credit history, and financial goals to find a solution that truly works for you. Whether you’re looking for a straightforward rate-and-term refinance or want to explore a cash-out refinance to fund a home project, we’re here to guide you.

The mortgage landscape is always shifting, and it can be tough to know if you’re making a move at the right time. We help you cut through the noise and calculate whether refinancing makes sense for your bottom line. Our goal is to make the process clear and simple, ensuring you feel confident in your decision. We’ve built our reputation on happy clients, and we’re ready to show you why. Let’s work together to find a refinance option that helps you save money and move closer to your financial goals.

Frequently Asked Questions

What if my credit score isn’t perfect? Can I still refinance? Yes, you absolutely can. While a higher credit score typically helps you secure the lowest interest rates, it’s not a dealbreaker. Many people think you need a top-tier score to even consider refinancing, but that isn’t the case. There are specific loan programs, like FHA loans, that are designed to be more flexible with credit history. An experienced loan officer can look at your complete financial picture and help you find a solution that fits your situation, even if your score has seen some ups and downs.

How do I know if refinancing is actually worth the cost? The best way to figure this out is to calculate your break-even point. This is the point in time when your monthly savings from the new loan have completely paid off your closing costs. To find it, simply divide your total closing costs by the amount you’ll save each month. For instance, if your costs are $4,000 and you save $200 a month, your break-even point is 20 months. If you plan to stay in your home longer than that, refinancing is a financially sound decision.

Is it better to pay for closing costs upfront or roll them into the loan? This really depends on your cash flow and financial goals. Paying for closing costs out-of-pocket means your new loan balance will be lower, and you won’t pay interest on those fees over time. However, if you prefer to keep your cash on hand, rolling the costs into the loan is a very common choice. This makes refinancing more accessible since it requires no upfront payment, though it does slightly increase your total loan amount and the interest you pay over the long run.

I only bought my house a few years ago. Is it too soon to refinance? Not necessarily. The right time to refinance is less about how long you’ve been in your home and more about the numbers. You’ll want to consider if you have enough equity, if the interest rate savings are significant, and if you plan to stay in the home long enough to pass your break-even point. Even if you don’t have the traditional 20% equity, some loan programs offer more flexibility. It’s worth having a conversation to see if a refinance makes sense for you now.

What’s the difference between lowering my payment and saving money long-term? This is a great question because the two don’t always go hand-in-hand. You can lower your monthly payment by extending your loan term, for example, by refinancing a 15-year loan into a new 30-year loan. While this gives you more breathing room in your monthly budget, you could end up paying much more in total interest over the life of the loan. True long-term savings come from securing a lower interest rate on a similar or shorter loan term, which reduces the total amount you pay to the bank.

Refinance Mortgage Rates Today: Should You Act?