You can calculate your break-even point by comparing savings to refinance costs. But because you can refinance more than once, you don't need to wait for a "perfect" rate.
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Rates on 30-year mortgage refinance loans have been trending down since mid-July, hitting a five-month low of 6.90% last week. After a brief uptick, the 30-year refi average has resumed its decline, falling another 7 basis points to 6.87%, the lowest since March 12. Real-time data suggests the rate could slip a bit further before Friday morning.
In April and May, the 30-year refi average surged above 7.30%, meaning today's sub-7% level is a significant improvement. Still, refinancing rates were even better in March, when the average hit a 2025 low of 6.71%.
Refinancing could be worth exploring if your mortgage is in the high 7% or 8% range. The goal is to lock in a new rate low enough to . When the savings outweigh the expenses, the move can pay off in a big way over time.
"If you're refinancing solely to lower your interest rate, aim for at least a 1% reduction," said Phil Crescenzo Jr., vice president of the Southeast Division at Nation One Mortgage Corporation. "Sometimes there can be enough benefit from reducing the rate by less than 1%, but this is a good buyer goal in most refinances."
Refinancing isn't just about rates, though. A "cash-out refinance" lets you tap your home's equity at closing to pay off debt, fund renovations, or cover other expenses, Crescenzo said. "Eliminating private mortgage insurance or shortening your mortgage to align with retirement plans are also great reasons to refinance."