Mortgage Rates Today, Dec 21: 30-Year Refinance Rate Rises by 21 Basis Points

If you're a homeowner thinking about refinancing your mortgage, it's important to know that rates are on the move. As of December 21, 2025, the average rate for a 30-year fixed refinance loan has gone up by 21 basis points to 6.88%, according to Zillow. This uptick means that if you're looking to refinance, acting quickly and comparing offers from different lenders could save you more money in the long run.

Mortgage Rates Today, Dec 21: 30-Year Refinance Rate Rises by 21 Basis Points

Understanding the Rate Hike: What Exactly is a Basis Point?

I know when I see terms like “basis points,” it can sound a little confusing. Let's break it down. A basis point is just a tiny unit of measurement used for interest rates and other financial percentages. Specifically, 1 basis point equals 0.01%. So, when we say the 30-year fixed refinance rate rose by 21 basis points, it means it went up by 0.21%. This might not seem like much, but believe me, in the world of mortgages, even small changes can add up over time, and that's why we pay close attention.

The Real Impact: How a 21 Basis Point Rise Affects Your Wallet

To put it plainly, that small jump from last week's average of 6.67% to today's 6.88% makes a difference you can see on your monthly statement. Let's imagine you have a $300,000 loan.

Interest Rate	Estimated Monthly Payment (Principal & Interest)	Monthly Increase
6.67%	$1,939	—
6.88%	$1,963	+$24/month

So, that increase of 0.21% means your monthly payment for that $300,000 loan goes up by about $24. Now, $24 might not sound like a huge deal on its own. But let's think about it over the life of a mortgage.

• Yearly Impact: That $24 extra per month adds up to an additional $288 per year.
• 30-Year Impact: Over the full 30 years of your loan, that seemingly small amount translates to an extra $8,640 in interest payments.

This is precisely why I always tell people to take these numbers seriously. Refinancing is a big decision, and understanding these cost differences is crucial for making the best choice for your financial future.

Why This Matters to You Right Now

The current trend shows that mortgage rates are generally trending upward for fixed-rate loans. This suggests that the window for securing a lower refinance rate might be closing, at least for now. Being aware of these movements helps you make more informed decisions. It underscores the importance of:

• Timing is Key: If you've been on the fence about refinancing, seeing rates tick up is a good reminder to explore your options sooner rather than later.
• Shop Around: National averages are a good benchmark, but they're just averages. The rate you'll actually get depends on many factors, including your credit score, the type of loan you choose, and most importantly, the lender you pick. I've seen firsthand how much variance there can be between lenders for the exact same loan.

Looking at Other Refinance Options

While the 30-year fixed is the most popular for its predictable monthly payments, it's always wise to see what else is out there.

• 15-Year Fixed Refinance Rates: Currently averaging around 5.78%, this option is up 16 basis points from its recent average. Although your monthly payments will be higher for a 15-year loan, you'll pay off your mortgage much faster and save a significant amount on interest over the loan's life. It's a trade-off between immediate monthly cost and long-term savings.
• 5-Year Adjustable-Rate Mortgage (ARM) Refinance Rates: These are holding steady at 7.11%. ARMs can sometimes offer lower introductory rates to start, but the risk is that they can increase after the initial period. With rates already above 7%, anyone considering an ARM should think carefully about how much their payments could rise in the future and if they can comfortably afford that.

Recent Market Trends and What They Mean

It’s helpful to understand the bigger picture. The Federal Reserve has made some interest rate adjustments, but it's important to remember that mortgage rates don't directly follow the Fed's changes. They're influenced by a lot of factors, including, as we're seeing, lingering inflation worries.

Interestingly, despite the recent rise, refinance activity has actually seen a big jump compared to last year. This is likely driven by homeowners who bought when rates were much higher, perhaps near the peak in 2023, and are now looking to lower their payments.

However, a significant portion of homeowners – roughly 70% – still have mortgage rates below 5%. For these folks, there's not much incentive to refinance right now, as their current rates are still quite attractive.

What Can We Expect in 2026?

Forecasting interest rates is always tricky, but the general consensus among economists is that refinance rates are likely to remain relatively stable or see only slight decreases in the coming year. Some projections suggest the 30-year fixed rate might dip closer to 5.9% by the end of 2026, while others anticipate an average around 6.4% throughout the year. It seems unlikely we'll see a dramatic drop unless there's a major shake-up in the economy, like a recession.

My Take on Today's Rates

As someone who has followed the housing market for a while, I see these rate movements as a signal that we're in a period of adjustment. The days of the ultra-low 3% rates are likely behind us for the foreseeable future. This means that for homeowners wanting to refinance, being strategic is more important than ever.

• Don't delay if you see a rate you like.
• Get pre-approved to understand your buying power.
• Speak with multiple lenders. Seriously, I can't stress this enough. Even a slightly better rate from another bank could save you thousands.
• Consider your long-term financial goals. Is paying off your mortgage faster more important than a slightly lower monthly payment today?

We are currently seeing the average rate for a 30-year fixed refinance at 6.88%, a 15-year fixed at 5.78%, and a 5-year ARM at 7.11%, as of December 21, 2025. These figures from Zillow are a snapshot, and your personal situation will dictate the best path forward.