By Julia Carpenter
Updated March 15, 2021 1:46 pm ET
Mortgage rates are on the rise after nearly a year of record lows, providing a nudge to homeowners who want to refinance but didn’t get around to it yet.
Does it still make sense to call up your lender and file an application? There is time to figure it out. Here are some questions to consider:
What rate makes sense for me?
First find the difference between your current mortgage rate and the potential savings of a refinance offer. The rate for a refi will vary based on the particular homeowner. Lenders consider credit history, income and home equity when evaluating applications.
The average rate on a 30-year mortgage rose to 3.05% for the week of March 11, according to Freddie Mac. While that is higher than historic lows reached last summer, homeowners with rates above 4% could still benefit from refinancing.
Consider how many months it would take for you to recoup the costs of closing on a refi, along with how long you’ll be staying at this home. If you can recoup closing costs within two years and plan to stay in your house for longer, the savings on interest means the math will likely work out in your favor.