Current refi mortgage rates report for Jan. 22, 2026

Current refi rates data

Note that Fortune reviewed the most recent Zillow data available as of Jan. 21.

How mortgage refinancing works

Boiled down to the basics, mortgage refinancing involves paying off your existing loan with a new one. This process requires meeting the lender’s criteria as is the case for any loan—including your credit profile, income verification, and debt-to-income (DTI) ratio. 

The application process may knock your credit score a little bit due to a hard inquiry, and there’s also the risk of denial if you don’t meet the lender’s requirements.

What’s happening with mortgage rates in the market?

Some observers had hoped that mortgage interest rates might decrease following the Federal Reserve’s cuts to the federal funds rate in late 2024. But mortgage rates long remained near 7% for 30-year, fixed-rate loans nationwide. 

Mortgage interest rates remain significantly elevated compared to the pandemic-era lows in the range of 2% and 3%. As of the third quarter of 2024, 82.8% of homeowners with mortgages had rates below 6%, according to Redfin. This means a large number of Americans have been experiencing the lock-in effect, unable to move or refinance because they’re hanging onto a once-in-a-lifetime rate. 

However, some relief came in sight toward the end of August and beginning of September 2025 and continued in October. Mortgage rates trended noticeably downward, averaging closer to 6% for 30-year, fixed-rate loans than had been seen in almost a year. This was largely connected with markets anticipating the Fed would cut the federal funds rate when it met Sept. 16-17.

The central bank delivered on this expectation, reducing its benchmark rate by a quarter percentage point in September, and followed up with another quarter percentage point cut in October. At its meeting in early December, the Fed opted for a third cut of the same amount.

When it might make sense to refinance your mortgage

Refinancing comes with upfront costs, so it’s important to consider when it’s beneficial. One guideline you’ll often hear is that it makes sense to refi if you can secure a rate at least a percentage point lower than your current rate. For instance, if you took out a loan at 7% and rates have since declined, refinancing at 6% would probably be a smart call in terms of long-term savings.

You might also refinance to tap into your home equity via a cash-out refinance (which typically requires that you have at least 20% equity built up). 

Refinancing can also help if you want to change your loan term or switch loan types, such as moving from an FHA loan to a conventional loan to get rid of the FHA loan’s lifetime mortgage insurance (MIP) requirement, or from an adjustable-rate mortgage to a fixed-rate mortgage to avoid the potential for rate hikes.

Additionally, refinancing can be beneficial if you want to adjust your loan term. For example, switching from a 15-year to a 30-year mortgage can allow for smaller monthly payments, which might be more manageable if your financial situation has changed.

Costs to refinance your mortgage

Refinancing involves closing costs, typically ranging from 2% to 6% of the loan amount. For a $300,000 loan, costs might range from $6,000 to $18,000. Some 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.
• Prepayment penalties (if applicable in the terms of your current loan).

Different types of mortgage refi loans

There are many types of mortgage refinance loans available, and the right one for you will depend on what you’re trying to do and what type of mortgage you currently have. Here are some common refi types:

• Rate-and-term refinance: This is probably the most popular refi, offering the chance to secure a lower interest rate or change your loan term. Just know that if you choose to shorten your loan term, while that does typically come with a lower rate and meaningful lifetime interest savings, you’ll have to budget for higher monthly mortgage payments.
• Cash-out refinance: With a cash-out refi, you can tap your home’s equity by paying off your existing loan balance and accepting a new, larger one. You withdraw the difference in cash. That money can then be used for home improvements, consolidating high-interest debt, or virtually any other financial goal you may have.
• No-closing-cost refinance: Approach this one with a healthy level of skepticism. With this type of refi, your lender covers the closing costs in exchange for charging a higher interest rate. If you don’t have cash on hand for closing costs and could otherwise benefit from a refinance, this option may be worth a look.
• Streamline refinance: Available to existing FHA, VA and USDA loan borrowers, a streamline refi will typically involve less documentation and offer a more straightforward application and approval process.

Refinancing with your existing lender vs. a new one

You’re not required to refinance with your original lender. Shopping around might potentially help you find better rates and service. 

That said, some lenders offer incentives, such as waiving closing costs, for staying with them. So you should at least do the due diligence of checking with your existing lender before making a decision. 

Also, know that if your mortgage has been purchased by Fannie Mae or Freddie Mac, you might be eligible for programs like Refi Now and Refi Possible.