30-Year Fixed-Rate Mortgage Holds at 6.90% Despite Fed Cuts

On June 19, 2025, the average refinance rate for a 30-year, fixed-rate home loan stood at 6.90%, according to data from a popular real estate marketplace. This rate is indicative of the current market conditions for homeowners looking to refinance their mortgages. For those considering a refinance, the average rates for various loan types and terms are as follows: 20-year conventional mortgages at 6.65%, 15-year conventional mortgages at 5.95%, and 10-year conventional mortgages at 5.87%. Jumbo mortgages are slightly higher, with 30-year rates at 7.50% and 15-year rates at 6.62%. FHA loans offer 30-year rates at 6.59% and 15-year rates at 5.62%, while VA loans provide 30-year rates at 6.70% and 15-year rates at 6.14%.

Mortgage refinancing involves replacing an existing loan with a new one, a process that requires meeting the lender’s criteria, including credit profile, income verification, and debt-to-income ratio. The application process may temporarily lower your credit score due to a hard inquiry, and there is a risk of denial if you do not meet the lender’s requirements. Despite hopes that mortgage interest rates might decrease following the Federal Reserve’s cuts to the federal funds rate late last year, rates have remained near 7% for 30-year, fixed-rate loans nationwide. There was a brief dip in late February where the average rate fell closer to 6.5%, but rates remain significantly higher compared to the pandemic-era lows of 2% to 3%. As of the third quarter of 2024, 82.8% of homeowners with mortgages had rates below 6%, meaning many are experiencing the lock-in effect, unable to move or refinance due to their low rates.

Refinancing can be beneficial under certain conditions. It generally makes sense to refinance if you can secure a rate at least a percentage point lower than your current rate. For example, if you took out a loan at 7% and rates have since declined, refinancing at 6% would likely result in long-term savings. Additionally, refinancing can help tap into home equity via a cash-out refinance, which typically requires at least 20% equity. Refinancing can also be useful for changing loan terms or switching loan types, such as moving from an FHA loan to a conventional loan to eliminate the FHA loan’s lifetime mortgage insurance requirement, or from an adjustable-rate mortgage to a fixed-rate mortgage to avoid potential rate hikes. Furthermore, refinancing can be beneficial if you want to adjust your loan term, such as switching from a 15-year to a 30-year mortgage for smaller monthly payments.

Refinancing involves closing costs, typically ranging from 2% to 6% of the loan amount. For a $300,000 loan, these costs might range from $6,000 to $18,000. Common costs include lender origination fees, appraisal fees, title search and insurance fees, loan application fees, survey fees, attorney fees (if required in your state), recording fees, and prepayment penalties (if applicable in the terms of your current loan). There are various types of mortgage refinance loans available, including rate-and-term refinance, cash-out refinance, no-closing-cost refinance, and streamline refinance. Each type serves different purposes and has its own set of benefits and considerations. For instance, a rate-and-term refinance allows for a lower interest rate or a change in loan term, while a cash-out refinance enables homeowners to tap into their home’s equity. A no-closing-cost refinance covers closing costs in exchange for a higher interest rate, and a streamline refinance offers a more straightforward application process for existing FHA, VA, and USDA loan borrowers.

Homeowners are not required to refinance with their original lender and may benefit from shopping around for better rates and service. Some lenders offer incentives for staying with them, such as waiving closing costs, so it is advisable to check with your existing lender before making a decision. Additionally, if your mortgage has been purchased by certain entities, you might be eligible for programs like Refi Now and Refi Possible. These programs can provide additional benefits and savings for eligible homeowners.