"The average rate for a conventional 30-year mortgage across the U.S. fell this week below 6%, down almost an entire percentage point from January of 2025 and the lowest since 2022, according to data from Freddie Mac.
Better rates are expected to attract more house-hunters as the spring buying season heats up. But experts advise buyers not to settle until they've shopped around, noting that rates can vary a lot depending on the lender. The average gap between the lowest and highest APR is 0.74 percentage points, according to LendingTree, an online loan marketplace."
It is true that a refinance can definitely score a much lower interest rate, moving from a variable loan to a fixed or improving a fixed loan with lower interest. However, what folks forget is that doing so resets the loan clock. So if you're trading a 20 year loan for a 30 year loan all over again, you'll end up paying more in interest over all, even with the rate being lower (depends on the actual math). It makes more sense to resent to a 15-year loan with a lower rate if close to it from an old 30 year loan etc. We went through this before a few times, and refinancing can definitely save cash flow each month for lenders. But definitely do the math before jumping on a loan reset.
Depends on the rate, why do you want to close out your mortgage so quickly?
When rates dropped sub 3% in 2020, I happily extended my mortgage out another 30 years.
Why wouldn't I want to be free of the debt sooner, have stronger cash flow per month and stop sending my money to a lender instead of my retirement account? Guess it depends on how you want to spend your income.
That's funny because by not racing to pay down a <3% debt I have more money to invest in assets that grow at >3% ROI.
Yes, true, but you're also losing money to interest payments you could have avoided. Do the math and see how it works out over the life of your loan versus what it would have been paying down faster. If your ROI on your investments outpaces that, good for you, but most people aren't so lucky.
I'm pretty sure the vast majority of investments outpace 3%