Mortgage Rates Today: 30-Year Fixed Refinance Rate Surges by 22 Basis Points

Are you considering refinancing your mortgage? You might want to pay close attention to what's happening right now. Today, September 18, 2025, the Mortgage Rates Today: 30-Year Fixed Refinance Rate Surges by 22 Basis Points compared to last week's average. According to Zillow, the national average for the 30-year fixed refinance rate has climbed to 6.87%, a significant jump from the previous week's 6.65%. Let's dive into what's driving this change and what it means for you.

Mortgage Rates Today: 30-Year Fixed Refinance Rate Surges by 22 Basis Points

Refinance Rates: A Closer Look at Today's Numbers

Here's a quick snapshot of where refinance rates stand today:

• 30-Year Fixed Refinance Rate: 6.87% (Up 22 basis points from last week's 6.65%)
• 15-Year Fixed Refinance Rate: 5.64% (Up 9 basis points from 5.55%)
• 5-Year ARM Refinance Rate: 7.40% (Down 16 basis points from 7.56%)

As you can see, while the 30-year and 15-year fixed rates have increased, the 5-year ARM has surprisingly decreased. This could suggest some shifting expectations in the market regarding short-term versus long-term interest rate trends.

Is Refinancing a Smart Move Right Now?

This is the million-dollar question, isn't it? With the surge in the 30-year fixed refinance rate, it's crucial to carefully consider whether refinancing makes sense for your individual financial situation. Here's a framework you can use:

• Assess your current rate: What interest rate are you currently paying on your mortgage? If your existing rate is lower than the current refinance rates, refinancing might not be the best decision right now.
• Calculate break-even point: Factor in all the costs associated with refinancing, such as appraisal fees, origination fees, and other closing costs. Determine how long it will take for your monthly savings from a lower interest rate to offset these upfront expenses. If you don't plan to stay in your home long enough to reach the break-even point, refinancing might not be worthwhile.
• Consider your long-term goals: Are you looking to shorten the term of your mortgage? Or free up cash flow through a lower monthly payment? This consideration will help determine what is the best course of action.

Here is a table to see if refinancing is a good choice based on your original interest rate.

Original Interest Rate	Is it a good idea to refinance?
Below 6%	Probably not. Only if planning to shorten mortgage term.
Between 6% and 7%	Do calculations and find break-even point before making a decision.
Above 7%	Very good idea.

The Fed's Rate Cut: How Does It Impact Mortgage Rates?

Let's take a step back and look at the bigger picture: the Federal Reserve's recent decision to cut its benchmark interest rate. On September 17, 2025, the Fed lowered its target range by a quarter percentage point, from 4.25%-4.5% to 4.0%-4.25%. This was the first cut after a pause in rate hikes, signaling a shift towards a more dovish monetary policy.

So, how does this relate to those rising refinance rates we discussed earlier?

Well, the Fed funds rate doesn't directly dictate mortgage rates. Instead, it influences the economic outlook and investor sentiment, which in turn affects the 10-year U.S. Treasury yield – a critical benchmark for 30-year fixed mortgages.

In theory, a Fed rate cut should lead to lower mortgage rates. And in fact, mortgage rates had already fallen in anticipation of this cut, reaching an 11-month low of around 6.35%. However, the market's reaction wasn't a simple one-to-one correlation.

Several factors can explain why refinance rates have increased despite the Fed's action:

• Market Overreaction: The market might have already “priced in” the Fed's rate cut, leading to a temporary correction.
• Inflation Concerns: Despite the rate cut, inflation remains above the Fed's 2% target. If inflation persists, investors may demand higher yields on long-term bonds, pushing mortgage rates up.
• Economic Uncertainty: Lingering concerns about a potential economic slowdown could also be contributing to market volatility and upward pressure on rates.

Fixed-Rate vs. Adjustable-Rate Mortgages: What's the Difference?

When considering refinancing or buying a home, understanding the difference between fixed-rate and adjustable-rate mortgages (ARMs) is crucial:

• Fixed-Rate Mortgages: The interest rate remains the same throughout the loan term, providing stability and predictability. This is ideal for people wanting piece of mind with the certainty over monthly payment.
• Adjustable-Rate Mortgages (ARMs): The interest rate adjusts periodically based on a benchmark index, making them more vulnerable to market fluctuations. Typically ARMs are beneficial in a dropping rate environment as the rate can be adjusted.

Given the current environment, a fixed-rate mortgage might offer more peace of mind for borrowers seeking stability.

What's Next for Mortgage Rates?

Predicting the future of mortgage rates is never an exact science, but we can look to the Fed's upcoming meetings and economic data releases for clues. This current Fed “dot plot” suggests only two more cuts this year.

Key factors to watch include:

• Inflation Reports: Any upward surprise in consumer prices could halt the Fed's easing cycle and push rates higher.
• Labor Market Data: A continued weakening of the job market could prompt the Fed to take more aggressive action, potentially leading to further rate cuts.

My Personal Take

If I were a homeowner with an adjustable-rate mortgage or a high-interest fixed-rate mortgage, I'd be closely monitoring these developments. The Fed's actions are creating both opportunities and risks, and it pays to be prepared. While I don't believe we'll see a return to the rock-bottom rates of the pandemic era anytime soon, there's still potential for further declines, especially if the economy continues to slow. However, it's crucial to remember that the path forward is uncertain, and rates could easily move higher if inflation proves stickier than expected.

For Buyers and Sellers: Navigating the Current Market

For homebuyers, the increase in rate can be detrimental if affordability is an issue. I would advocate for shopping around to see what the best deal is. Sellers could see an increase in buying activity because of the rate decrease.

Final Thoughts

The recent surge in refinance rates is a reminder of the dynamic nature of the mortgage market. While the Fed's rate cut has created some optimism, several factors are still influencing interest rates. By staying informed, carefully evaluating your financial situation, getting information from a professional, and shopping around for the best rates, you can make informed decisions that align with your goals.