NEW JERSEY MORTGAGE REFINANCE RATES TODAY
Current mortgage refinance rates in
New Jersey.
Current mortgage refinance rates in
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Compare mortgage refinance rates in New Jersey.
Key Points
• Mortgage refinance rates in New Jersey are influenced by the 10-year U.S. Treasury Note, housing inventory levels, and inflation.
• A mere 1% drop in the interest rate on a $300,000 mortgage can put almost $200 back in a homeowner’s pocket each month.
• In New Jersey, there are many mortgage refinance options to choose from: conventional, cash-out, FHA, VA, 15-year, and adjustable-rate mortgages, each with advantages for certain situations.
• To lock in the best New Jersey mortgage refinance rate, take good care of your credit score and debt-to-income ratio.
• Always compare offers from different lenders and look at total costs, not only the interest rate being offered.
Introduction to Mortgage Refinance Rates
Mortgage refinancing is the process of replacing your current mortgage with a new one. The new mortgage comes with updated terms and a new interest rate. Whether you want to lower your monthly payment, shorten your loan term, or get cash out, the type of refinance you choose will play a big role in the rate you receive. In this guide, we’ll cover what determines current mortgage rates and how to refinance a mortgage so that you get the best available rate for your refinance.
💡 Quick Tip: Some lenders offer a so-called no-closing-cost refinance. However, that usually means either rolling the closing costs into the new mortgage principal or exchanging them for a higher interest rate.
Where Do Mortgage Refi Interest Rates Come From?
Mortgage refinance rates are influenced by a number of things, including the economy and your own financial profile. Economic factors that affect refinance rates include the bond market — and specifically the performance of the 10-year U.S. Treasury Note. When the rates on the note rise, mortgage interest tends to rise as well. Another factor is the housing market. When more homes are available than there are buyers, lenders may lower rates to keep attracting customers. Then there is the economy in general: A strong jobs market and economic growth can lead interest rates to rise, while a recession is usually accompanied by lower interest rates.
How Interest Rates Affect Home Affordability
Interest rates are a key factor in determining the affordability of your refinance payment. Your monthly payment will be directly affected by the loan amount, the term of the home loan, and the mortgage refinance rate. For example, a $200,000 loan with a 6.00% interest rate would have a monthly payment of $1,199. If the interest rate went up to 8.00%, the monthly payment would jump to $1,467. Over the life of the loan, securing a lower mortgage refinance rate could lead to significant savings, potentially tens of thousands of dollars.
Why Refinance in New Jersey?
Refinancing your mortgage can be a smart financial move. If you’re wondering how soon can you refinance a mortgage, know this: It’s helpful to have at least 20% equity in your home. You probably know that when current interest rates are lower than your existing mortgage rate, it might be time to explore a new loan. But that’s not the only reason to refinance, as the list below shows.
Common Reasons to Refinance a Mortgage
• You think you may be eligible for a lower interest rate thanks to an uptick in your credit score.
• You’re considering adjusting your repayment term to better fit your financial situation. Maybe you want a shorter term so you can pay off your loan before retirement. Or perhaps you need a longer term because your monthly payments are squeezing your budget.
• You want to use home equity to cover expenses like college tuition by doing a cash-out refinance.
• Your adjustable rate is about to change, and you want to switch to a fixed-rate loan.
• You have an FHA loan and 20% equity, and you want to stop paying the FHA mortgage insurance premium.
How to Get the Best Available Mortgage Refi Interest Rate
As you begin to explore a refinance, there are a few steps you can take to ensure you’re prepared when the time comes.
• Build your credit score by always making payments on time, keeping your credit utilization ratio low (below 30% or, if possible, lower than 10%), and avoiding new debt.
• Maintain a strong credit score by being prompt with payments and steering clear of new debt.
• Keep your debt-to-income (DTI) ratio under 36%. (Your DTI ratio is your monthly debts divided by your gross monthly income, multiplied by 100.)
• Consider whether you have any cash on hand that you could use to purchase mortgage points to lower your refinance interest rate.
• Examine your monthly budget to assess how large a mortgage payment you can accommodate. This will eventually help you figure out whether you can choose a loan with a shorter term (which saves on interest).
Understand Trends in New Jersey Mortgage Interest Rates
If you’re waiting for an interest rate drop to consider refinancing, it can help to have some perspective on the history of loan rates in New Jersey. No one can predict with certainty where rates are headed, but by understanding where they have been, you’ll be equipped to make a decision that’s right for you.
Historical U.S. Mortgage Interest Rates
Mortgage refinance rates in the United States have seen their fair share of ups and downs. In 2021, the average 30-year fixed mortgage refinance rate was about 3.15%. Fast forward to 2023, and we saw that number climb to 7.00%. These shifts are tied to larger economic movements, like inflation and the Federal Reserve’s policies.
To make the best decision about when to refinance your mortgage, it’s essential to understand these historical trends and how they can help you secure a more favorable mortgage refinance rate. Here’s a graph showing you where mortgage interest rates have been over the last few decades. You can follow current mortgage rates online to expand your intel.
Historical Interest Rates in New Jersey
AAs you’re considering New Jersey refinance rates, it helps to know how high or low U.S. rates have been over a long span of time. Here’s a look at the average U.S. mortgage rate over more than a half-century. The chart shows that a rate around 3.00% is pretty unusual, as is a rate as high as 10.00%.
| Year | New Jersey Rate | National Rate |
|---|---|---|
| 2000 | 7.84 | 8.14 |
| 2001 | 6.95 | 7.03 |
| 2002 | 6.43 | 6.62 |
| 2003 | 5.67 | 5.83 |
| 2004 | 5.66 | 5.95 |
| 2005 | 5.88 | 6.00 |
| 2006 | 6.61 | 6.60 |
| 2007 | 6.38 | 6.44 |
| 2008 | 6.01 | 6.09 |
| 2009 | 4.86 | 5.06 |
| 2010 | 4.79 | 4.84 |
| 2011 | 4.52 | 4.66 |
| 2012 | 3.61 | 3.74 |
| 2013 | 3.75 | 3.92 |
| 2014 | 4.04 | 4.24 |
| 2015 | 3.80 | 3.91 |
| 2016 | 3.62 | 3.72 |
| 2017 | 3.94 | 4.03 |
| 2018 | 4.42 | 4.57 |
Choose the Right Mortgage Refi Type
Once you’ve decided that the time is right to consider a refinance, you’ll want to explore what type of loan you will opt for. These are some common options. Each type has its own features and advantages.
Conventional Refi
A conventional refinance, also known as a rate-and-term refinance, typically comes with a higher interest rate than a refinance with a government-backed mortgage such as an FHA loan. But conventional loans are very popular because of their flexibility. Two loan types you might consider are a 15-year refinance and an adjustable-rate refinance.
15-Year Mortgage Refi
Shifting to a 15-year mortgage from a 30-year loan could be a game-changer, trimming the overall amount of interest you pay — even if your monthly payment will be a bit more. Here’s a comparison: A new 30-year $500,000 loan at 7.50% would mean a monthly payment of around $3,496 and total interest paid of about $758,586. Choose a new 15-year mortgage at 7.50%, and your monthly payment would increase to about $4,635. However, you’d be looking at savings of more than $400,000 over the life of the loan. Of course, some homeowners choose to refinance out of a 15-year term and into a 30-year term. In this case, a lower monthly payment is usually the goal.
Adjustable Rate Mortgage Refi
An adjustable-rate mortgage (ARM) starts with a lower interest rate than a fixed-rate loan, but that rate could change over time. If you’re planning to move before the rate adjusts, an ARM could be a smart refinance option. But it’s important to understand the potential for rate increases and how they could affect your monthly payments and long-term financial goals. Some borrowers will want to adjust out of an adjustable-rate loan and into a fixed-rate one because they desire more predictable payments.
Cash-Out Refi
A cash-out refinance is a smart way to leverage your home equity, giving you a lump sum to use for anything from home improvements to paying off high-interest debt. The rates for these types of refinances are typically a bit higher than those for a traditional refinance, but a cash-out refi is one of the more cost-efficient ways to borrow a large sum. How it works: You get a new mortgage for whatever principal you owe on your old loan, plus an extra sum. The old loan is paid off and you get the remaining cash. How much you can borrow is dictated by your home’s value and your equity.
FHA Refi
FHA refis, which are insured by the Federal Housing Administration, often come with lower mortgage refinance rates than conventional loans. These refis are available to homeowners with an existing FHA loan (look for the FHA Simple Refinance or FHA Streamline Refinance). Homeowners without an FHA loan can apply for an FHA cash-out refinance or FHA 203(k) refinance; the latter is for home rehab projects.
VA Refi
VA refinances, backed by the U.S. Department of Veterans Affairs, consistently offer some of the most competitive mortgage refinance rates available. To be eligible for a VA refinance, also known as an Interest Rate Reduction Refinance Loan (IRRRL), you must already have an existing VA loan. This type of refinance can be a great option for eligible homeowners, potentially lowering monthly payments and saving a significant amount of money on interest.
Compare Mortgage Refi Interest Rates
Whatever type of mortgage refinance you choose, securing a competitive rate can save you money over the life of the loan. Here are some tips:
• Shop around. Request a rate from multiple lenders to compare rates and fees (often you can do this by answering a few simple questions online).
• Make sure you look at each loan’s annual percentage rate (APR), which includes the interest rate and fees, and factors in any discount points you have decided to purchase.
• Remember that sometimes a lower rate means higher mortgage refinancing costs. If a lender says there are no closing costs, you’ll want to look closely at whether they are being rolled into the amount you are borrowing, or whether your fees are higher.
• Spend time running the numbers in a mortgage refinancing calculator to get a clear picture of your new monthly payments and potential savings.
Use an Online Refinance Calculator
Online refinance calculators are a great way to get an estimate of what your new monthly payment will be and to compare different refinance options. They can help you see the impact of different mortgage refinance rates and terms, so you can make an informed decision about which one is right for you. Here are a few of our favorite calculators.
Run the numbers on your home loan.
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Mortgage calculator
Punch in your home loan amount and a new interest rate, and we’ll estimate your payoff date.
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Down payment calculator
Enter a few details about your home loan and we’ll provide your monthly mortgage payment.
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Home affordability calculator
Provide us with a few details and see how much you can afford to spend on a home purchase.
Using the free calculators is for informational purposes only, does not constitute an offer to receive a loan, and will not solicit a loan offer. Any payments shown depend on the accuracy of the information provided.
The Takeaway
Refinancing your mortgage can be a smart financial move, but it does require some careful thought. By taking the time to understand your financial goals and compare different refinance mortgage rates, you can determine whether or not a refinance makes sense for you. Whether you’re looking to lower your monthly payments, tap into your home’s equity, or switch to a different loan timeline, it’s important to understand the process and your options before you move forward.
SoFi can help you save money when you refinance your mortgage. Plus, we make sure the process is as stress-free and transparent as possible. SoFi offers competitive fixed rates on a traditional mortgage refinance or cash-out refinance.
A mortgage refinance could be a game changer for your finances.
FAQ
Can I ask my lender to lower my rate?
You can ask your mortgage lender to lower your interest rate on an existing loan, but don’t count on getting your way. The lender might suggest a refinance or a mortgage recast instead. (In a recast, you pay a lump sum toward the principal, and the lender “recasts” your remaining payments.) Having a strong credit score and a history of making on-time payments can help your case if you request a lower rate. It is also a good idea to research current mortgage rates — including those from competing lenders — so you’re prepared to negotiate.
Can I get equity out of my house without refinancing?
You can tap into your home’s equity without going through a refinance by obtaining a home equity line of credit (HELOC) or a home equity loan. Like a standard mortgage, both of these options are secured by the equity you have in your home (a HELOC or home equity loan is technically a second mortgage). By choosing one of these alternatives, you could save yourself the time and hassle of a full refinance.
How much are closing costs on a refinance?
Closing costs typically range from 2% to 5% of the loan amount. For example, on a $300,000 mortgage refinance, the total closing costs could fall between $6,000 and $15,000. The final amount you’ll pay can be influenced by a number of factors, including your loan amount and lender fees. Keep in mind that these are just estimates and your actual closing costs may vary.
Does refinancing your mortgage hurt your credit?
In the short term, refinancing your home loan can cause a slight dip in your credit score. When you apply for a refinance, the lender will do a hard inquiry on your credit report, which can ding your score by a few points. However, the impact is usually minimal and if you have good credit habits, it’s generally nothing to worry about. While your score may take a hit initially, the long-term savings from a refinance can make getting a new loan a smart financial move for many homeowners.
SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.
SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.
¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.
†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article. Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
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More refinance resources.
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How to Refinance a Home Mortgage Loan
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7 Signs It’s Time for a Mortgage Refinance