30-Year Mortgage Rates Fall to 6.67% as Refinancing Becomes More Attractive

On August 25, 2025, the average refinancing rate for a 30-year fixed-rate mortgage stood at 6.67%, according to data from Zillow. This rate represents a slight decrease compared to earlier in the year, when rates remained near 7%. The refinancing rates for other mortgage types and terms varied, with conventional 15-year mortgages at 5.79%, jumbo 30-year mortgages at 7.13%, and VA 30-year mortgages at 6.29% [1]. These figures reflect a market where refinancing opportunities are gradually becoming more attractive for some homeowners, although rates remain significantly higher than the historically low levels seen during the pandemic.

The recent rate movements have not fully aligned with broader monetary policy trends. Although the Federal Reserve has implemented rate cuts in late 2024, mortgage rates have shown little movement, maintaining their elevated levels. A brief decline toward the end of February 2025 brought rates closer to 6.5%, but this improvement has not been sustained [1]. As a result, many homeowners remain locked into their current mortgages, particularly given that 82.8% of those with mortgages as of the third quarter of 2024 held rates below 6% [1].

Homeowners considering refinancing typically weigh the potential benefits of securing a lower interest rate against the costs involved. These include closing costs, which generally range from 2% to 6% of the loan amount [1]. A commonly cited rule of thumb suggests that refinancing becomes worthwhile if the new rate is at least one percentage point lower than the existing rate. For example, a homeowner with a 7% mortgage could potentially benefit from refinancing if rates drop to 6%. Additionally, refinancing can be a strategy to tap into home equity or adjust loan terms for better financial flexibility [1].

Various types of refinance options are available to meet different financial goals. Rate-and-term refinancing is ideal for reducing interest rates or shortening loan terms, though it often results in higher monthly payments. Cash-out refinancing allows homeowners to access equity for expenses such as home improvements or debt consolidation, though it typically requires at least 20% equity in the property. For borrowers with existing FHA or VA loans, streamline refinancing offers a simplified process with reduced documentation and faster approval times [1].

Lenders typically charge closing costs for refinancing, including lender origination fees, appraisal fees, title search and insurance fees, and other administrative charges. These costs can be substantial and must be factored into the overall decision to refinance. Some lenders offer no-closing-cost refinancing in exchange for a higher interest rate, which may be suitable for borrowers with limited upfront capital [1].

While refinancing with a current lender may offer incentives such as reduced closing costs, it is also advisable to compare rates and terms across multiple lenders to secure the most favorable deal. Homeowners whose mortgages were acquired by Fannie Mae or Freddie Mac may be eligible for specialized programs such as Refi Now or Refi Possible, which can facilitate refinancing under specific conditions [1].

Source: [1] Current refi mortgage rates report for Aug. 25, 2025 (https://fortune.com/article/current-refi-mortgage-rates-08-25-2025/)