Refinance mortgage rates update for November 5, 2025

Current refinancing rate information

Note that Fortune reviewed the most recent Zillow data available as of Nov. 4.

Understanding how mortgage refinancing operates

Refinancing a mortgage means replacing your current home loan with a new one. Just as you did when you first sought a mortgage, you'll need to submit an application for the refinance loan and satisfy the lender's requirements concerning your credit history, income verification, debt-to-income (DTI) ratio, and other factors. 

Your credit score will likely see a slight decrease because of the hard inquiry. Be aware that lenders may deny your request if you fail to meet their criteria.

What's the current situation with mortgage rates?

Late last year, the Federal Reserve reduced the federal funds rate, leading some observers to anticipate a corresponding decrease in mortgage interest rates. Despite expectations, interest rates for 30-year fixed-rate mortgages stayed stubbornly close to 7% nationwide for several months. 

Rates did drop slightly toward the end of February, moving closer to 6.5% than had been seen in a while. However, interest rates are still considerably higher than they were during the pandemic, a time when some homeowners secured mortgages at rates between 2% and 3%. 

A report from Redfin showed that as of the third quarter of 2024, 82.8% of homeowners carrying a mortgage had an interest rate under 6%. Numerous individuals across the U.S. Have experienced a sense of being trapped, either by choice or circumstance, preventing them from relocating or refinancing their homes due to elevated interest rates.

Leading up to the Fed's September and October gatherings, a welcome easing occurred, with rates showing a distinct downward trend before the September session and a slight decline as the October meeting approached. The central bank cut the federal funds rate at both of those meetings, with a quarter percentage point reduction each time.

Consider refinancing your mortgage when conditions are favorable.

Refinancing involves expenses, making it essential to consider the associated costs. A common guideline suggests refinancing is worthwhile if you can obtain a rate that's at least one full percentage point below your existing rate. If interest rates fall, allowing you to switch from a 7% rate to a 6% rate, it's definitely worth serious consideration.

Refinancing could be a good option if you need to access your home's equity. This is often achieved through a cash-out refinance, a process that generally necessitates having at least 20% equity in your property.  

Refinancing offers the flexibility to alter your loan duration or transition between loan categories. For instance, you might shift from an FHA loan to a conventional one, thereby eliminating the need for lifetime mortgage insurance (MIP), or move from an adjustable-rate mortgage. Convert an adjustable-rate mortgage (ARM) into a fixed-rate loan.

Adjusting your loan term can also make refinancing a good option. Opting for a 30-year mortgage instead of a 15-year one can result in lower monthly installments, potentially making them easier to handle if your financial circumstances have shifted since the loan's origination.

Mortgage refinancing expenses

Refinancing involves closing costs, typically ranging from 2% to 6% of the loan amount. For a loan of $300,000, expenses could fall between $6,000 and $18,000, for instance. Typical expenses consist of:

• Lender origination fees.
• Appraisal fees.
• Title search and insurance fees.
• Loan application fees.
• Survey fees.
• Attorney fees (if required in your state).
• Recording fees.
• Any prepayment penalties your current lender might impose.

Various kinds of mortgage refinancing options

Various refinance choices are available, each designed for distinct objectives:

• Rate-and-term refinance: This is what you’re looking for when you seek to lower your interest rate or change your loan term—though be aware if you shorten your repayment term this will almost certainly result in higher monthly Remittances.
• Cash-out refinance: Leverage your home equity by paying off your existing loan and taking out a larger loan, while receiving the difference in cash.
• No-closing-cost refinance: The lender covers closing costs in exchange for a higher interest rate. This refinancing strategy warrants careful consideration, though it may prove beneficial in specific circumstances. 
• Streamline refinance: Available for FHA, VA, and USDA loans, offering a simpler application process and oftentimes less paperwork. 

Refinancing with your current bank or a different financial institution

You don't have to stick with your initial lender for a refinance. Exploring other options could lead to better interest rates and potentially superior service. 

However, certain lenders provide inducements, like foregoing closing fees, to encourage continued patronage. It's advisable to discuss refinancing options with your current lender prior to making any decisions. 

If your mortgage is now owned by Fannie Mae or Freddie Mac, you may qualify for initiatives such as Refi Now and Refi Possible.