Mortgage Rates Today, Jan 29, 2026: 30-Year Refinance Rate Drops by 8 Basis Points

Good news for homeowners looking to potentially lower their monthly payments: the average 30-year fixed refinance rate has dipped by 8 basis points as of January 29, 2026, settling at a promising 6.56%. This small but significant move offers a breath of fresh air in the mortgage market, providing a renewed opportunity for those considering a refinance.

Mortgage Rates Today, Jan 29: 30-Year Fixed Refinance Rate Drops by 8 Basis Points

A Closer Look at Today's Refinance Rates

It's always a good idea to know where things stand, so let's break down the numbers. As per Zillow's latest data, here's where things landed on January 29, 2026:

Source: Zillow, as of Thursday, January 29, 2026

The 30-Year Fixed: Small Drop, Big Potential

The star of the show today is the 30-year fixed refinance rate inching down to 6.56%. Last week, it was sitting at 6.64%. While an 8 basis point difference might seem tiny on paper, I’ve seen firsthand how these small shifts can add up for borrowers over the long haul. Think of it like this: on a $300,000 loan, that 0.08% drop could put roughly $15 to $20 back in your pocket each month. Over the entire life of the loan, that's a noticeable amount of money!

This trend suggests a market that's treading carefully. We’re seeing a bit of a tug-of-war between economic signals and lender confidence. For homeowners who have been on the fence about refinancing, this slight dip might just be the nudge they need to explore their options.

Stability in Shorter Terms and ARMs

It’s not all about the 30-year fixed, of course. The 15-year fixed refinance rate has held steady at 5.64%. This option continues to be a favorite for those who want to pay off their homes faster and save on total interest paid. The stability here is a good sign for borrowers who prefer predictability.

The 5-year adjustable-rate mortgage (ARM) refinance rate also remains unchanged at 7.20%. In my experience, ARMs tend to be less popular when there’s a general sense of economic uncertainty. People are often looking for the security of a fixed rate, especially when rates are already a bit higher.

What's Making the Market Tick?

Understanding why rates move is crucial for making smart financial decisions. This week’s update comes on the heels of the Federal Reserve’s decision to keep its benchmark interest rate unchanged. They’re holding at 3.5%–3.75%, which signals a cautious approach. The Fed has made it clear they're watching the economic data closely, and it seems they're not yet ready to make big moves on rate cuts, with most signs pointing to mid-2026 for any significant changes.

Several economic factors are playing a role in shaping mortgage rates:

• Inflation: While it's thankfully cooling down, inflation is still a notch above the Fed's goal of 2%. This keeps the Fed in a watchful stance.
• The Job Market: Unemployment is holding steady at around 4.2%. While that’s good news, we are seeing a slowdown in how fast wages are growing, which is another piece of the economic puzzle.
• Bond Yields: The 10-year Treasury yield has been moving within a pretty tight range lately. This stability in the bond market usually translates to more predictable mortgage rates for us.

Is Now the Right Time for You to Refinance?

I get asked this question a lot, and the honest answer is: it depends on your situation. Today’s rates, while better than they were a year or two ago, are certainly higher than the incredibly low rates we saw in 2020 and 2021. However, if your current mortgage is clocking in above 7%, refinancing might still be a very smart move, especially if you plan to make your current house your long-term home.

Here’s a quick checklist to help you decide:

• Compare your current rate to today's: Is there a significant difference? Even half a percentage point can make a difference over time.
• Think about how long you'll stay: If you plan to move or sell within the next 5-7 years, you need to make sure refinancing makes sense financially after considering closing costs.
• Consider a rate type switch: Are you currently in an ARM and nervous about potential increases? Refinancing to a fixed rate can bring peace of mind.

What the Numbers Tell Us About Refinance Activity

Looking at the broader picture can be helpful. The Mortgage Bankers Association (MBA) reported that refinance applications actually dropped by 16% in the week ending in late January 2026. This followed a bit of a surge a week or two prior when rates were a little lower.

However, it’s important to see this in context. Despite the recent dip in applications, refinance activity is still a whopping 156% higher than it was during the same week in 2025. Why? Because rates were nearly a full percentage point higher a year ago!

Right now, refinances are making up a pretty solid chunk of the total mortgage application pie, somewhere between 56% and 62%.

Big Picture: Economic Forces at Play

Let's not forget the bigger economic forces. The Federal Reserve's recent pause on rate cuts is a major factor. They're on a “wait-and-see” mode, which is contributing to the market's current feeling of uncertainty, making it hard for rates to make huge, sudden jumps in either direction.

We've also seen some interesting policy moves. There was a recent directive for a $200 billion bond purchase that was designed to lower rates. It did cause a temporary spike in applications, showing how sensitive the market can be to intervention.

And then there are global events. Things like trade tensions and tariff news, especially when they involve places like Greenland, can cause those Treasury yields to do a bit of a “whipsaw.” Since mortgage rates follow Treasury yields quite closely, this can add to the unpredictability.

The Takeaway for Today

So, what does all this mean for you? The modest dip in the 30-year fixed refinance rate to 6.56% is certainly a welcome development. As the Fed continues to monitor inflation and the economy, it seems likely that mortgage rates might stay within a similar range for a little while.

My advice, as always, is to look at your own financial picture. What are your goals? How long do you plan to be in your home? Talking to a trusted mortgage advisor can help you navigate these decisions and figure out if refinancing makes the most sense for your specific situation right now.