NORTH CAROLINA MORTGAGE REFINANCE RATES TODAY
Current mortgage refinance rates in
North Carolina.
Current mortgage refinance rates in
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Compare mortgage refinance rates in North Carolina.
Key Points
• Mortgage refinance rates are influenced by economic factors such as the bond market and housing inventory.
• Even a 1% drop in the refinance rate can make a world of difference in your monthly payments. Over the long haul, this can add up to some serious savings.
• In North Carolina, mortgage refinance rates often follow national trends.
• A 15-year mortgage can lead to substantial savings in interest over the loan’s lifetime, even though it comes with higher monthly payments.
• FHA refinances, backed by the Federal Housing Administration, often come with lower mortgage refinance rates, making them a flexible and attractive option for many homeowners.
Introduction to Mortgage Refinance Rates
Mortgage rates are an important consideration, as your monthly loan payment is likely a significant part of your budget. When you opt for a mortgage refinance, you’re essentially trading in your current home loan for a new one, with updated terms and — ideally — a more favorable interest rate. The reason behind your refinance will dictate the type of refi you pursue, which, in turn, can influence the interest rate you’re offered. This guide will illuminate the process and help you secure the most competitive rate available. Step one? Understand how rates are determined in the first place.
💡 Quick Tip: How soon can you refinance your mortgage? It varies by loan type, but typical waiting periods are 6 to 12 months.
Where Do Mortgage Refinance Interest Rates Come From?
As you look at current mortgage refinance rates in North Carolina, it’s important to understand why they might shift by as little as a fraction of a percentage point. The performance of the 10-year U.S. Treasury Note is the most important determinant of current mortgage rates. When 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. The overall economy plays a role as well: A strong jobs market and economic growth can lead interest rates to rise, while a recession is usually accompanied by lower interest rates. Of course, there are factors that are personal to each borrower, such as credit score, that help determine what rate you will be offered.
How Interest Rates Affect Home Affordability
Why so much fuss about tiny percentage shifts? Imagine a $200,000 loan with a 6.00% interest rate and a 30-year term. That would mean a monthly payment of $1,199. But if that rate were 8.00%, your monthly payment would jump to $1,467. You can see more examples below. Look closely at total interest. Obtaining even a half-percentage-point lower rate in a mortgage refinance can save you tens of thousands of dollars.
| Interest Rate | Monthly Payment | Total Interest |
|---|---|---|
| 6.00% | $1,199 | $231,677 |
| 6.50% | $1,264 | $255,085 |
| 7.00% | $1,330 | $279,021 |
| 7.50% | $1,398 | $303,403 |
| 8.00% | $1,467 | $328,309 |
Why Refinance in North Carolina?
Refinancing your mortgage can be a strategic financial move for several reasons, as the list below shows.
Common Reasons to Refinance a Mortgage
• To take advantage of a lower mortgage rate due to improved credit or market conditions.
• To change the repayment term on your loan for lower monthly payments (a longer repayment term) or quicker payoff (a shorter term).
• To access home equity to meet financial goals like college funding.
• To move from an adjustable-rate mortgage to a fixed-rate mortgage (or vice versa).
• To remove the FHA mortgage insurance premium from a Federal Housing Administration loan.
How to Get the Best Available Mortgage Refi Rate
These are key steps to take as you think about how to refinance a mortgage that will help prepare you to get a good rate when the time comes:
• Pay your bills on time and steer clear of new debt to nurture your credit score.
• Assess the equity you have in your home. Ideally, you’ll have at least 20% equity before refinancing, especially if you’re cashing out some equity.
• Keep your debt-to-income (DTI) ratio under 36%. To compute your DTI ratio, add all your monthly debts and divide by your gross monthly income. Then multiply by 100.
• Compare rates and fees from multiple lenders.
• Think about whether you have room in your budget to buy discount points (also called mortgage points) to lower your rate.
• Also examine your budget to see if you can afford to choose a shorter loan term (which may mean a higher monthly payment). This can reduce the total amount of interest you’ll have to pay.
Understand Trends in North Carolina Mortgage Interest Rates
As you think about whether the time is right to refinance, it can help to see how today’s mortgage rates compare to your existing loan, as well as how they compare to historic averages.
Historical U.S. Mortgage Interest Rates
Looking at a much longer span of time, more than a half-century, can help you see that if you are waiting for an interest rate drop to the historic low of around 3.00% that borrowers saw in 2021, you might be waiting a long time. Understanding these historical trends can give you a better sense of the current market and help you make more informed decisions about refinancing.
Historical Interest Rates in North Carolina
North Carolina refinance rates tend to move in line with national trends, often sitting slightly below the U.S. average, as shown in the chart below.
| Year | North Carolina Rate | National Rate |
|---|---|---|
| 2000 | 7.88 | 8.14 |
| 2001 | 6.87 | 7.03 |
| 2002 | 6.43 | 6.62 |
| 2003 | 5.72 | 5.83 |
| 2004 | 5.76 | 5.95 |
| 2005 | 5.93 | 6.00 |
| 2006 | 6.49 | 6.60 |
| 2007 | 6.32 | 6.44 |
| 2008 | 5.99 | 6.09 |
| 2009 | 4.96 | 5.06 |
| 2010 | 4.74 | 4.84 |
| 2011 | 4.49 | 4.66 |
| 2012 | 3.61 | 3.74 |
| 2013 | 3.80 | 3.92 |
| 2014 | 4.14 | 4.24 |
| 2015 | 3.90 | 3.91 |
| 2016 | 3.73 | 3.72 |
| 2017 | 4.02 | 4.03 |
| 2018 | 4.58 | 4.57 |
Choose the Right Mortgage Refi Type
The interest rate and terms you get for your refinance can vary depending on the type of loan you choose. Here are some common refinance arrangements, so you can think about what you are looking for.
Conventional Refi
Also known as a rate-and-term refinance, a conventional mortgage refinance will typically have a slightly higher interest rate than a government-backed loan refinance. But it is a common choice for borrowers as it is a very flexible loan option. Two common types of conventional refi are the 15-year refinance and the adjustable-rate refinance.
15-Year Mortgage Refi
Refinancing a mortgage to switch from a 30-year term to a 15-year term can be a smart move that can significantly slash the total interest paid over the loan’s life, although it often does mean a bump in your monthly payment amount. Some borrowers, however, prefer to refinance out of a 15-year mortgage and into a 30-year one (if the higher monthly payments on the shorter-term loan have become untenable).
Adjustable-Rate Mortgage Refi
If your first mortgage is an adjustable-rate mortgage (ARM), you might be looking to refinance into a fixed-rate loan to protect against interest-rate increases and to obtain a predictable monthly payment amount. However, some borrowers choose to refi into an adjustable-rate loan. ARMs often have a low introductory interest rate that is appealing to borrowers who plan to sell their property before the rate begins to adjust. If you choose an ARM, just be sure you understand when the rate may increase and how high it could go.
Cash-Out Refi
A cash-out refinance is a smart way to make your home’s equity work for you. Imagine this: Your home is valued at $500,000, and you still owe $300,000 on your mortgage. That means you’ve got $200,000 in equity. A lender might let you borrow up to 80% of that in a cash-out refi. Your new loan would pay off your old one and leave you with $100,000 to use as you wish. Cash-out refis might come with slightly higher mortgage refinance rates, but they can be a powerful tool for your financial goals.
FHA Refi
FHA refinances, backed by the Federal Housing Administration, often offer very attractive mortgage refinance interest rates, sometimes up to a full percentage point lower than conventional loans. An FHA Simple Refinance and FHA Streamline Refinance caters to homeowners with an existing FHA loan, while an FHA cash-out refinance and FHA 203(k) refinance are available to qualified borrowers more generally.
VA Refi
VA refinances, guaranteed by the U.S. Department of Veterans Affairs, are known for offering some of the most competitive mortgage refinance rates. To qualify for a VA loan refinance, also known as an Interest Rate Reduction Refinance Loan (IRRRL), you must have an existing VA mortgage. This type of refinance can help you lower your monthly payments and save a significant amount of money in interest over the life of your loan. This makes it a great option for those who meet the requirements.
Compare Mortgage Refi Interest Rates
Refinancing can be a money-saver, but only if the North Carolina refinance rate you obtain is a good one. Here’s how to snag a competitive rate:
• Compare rates from multiple lenders.
• Look at the annual percentage rate (APR), which includes fees and discount points.
• Make sure you factor in closing costs, which are part of your total mortgage refinancing costs. Some lenders offer a no-closing-cost refinance, but may have higher interest rates or may add closing costs to the principal.
• Remember that if your current interest rate is lower than any rate you are offered, refinancing might not be the best move. A mortgage refinance calculator can help you determine whether you stand to save money.
Use an Online Refinance Calculator
Online calculators are valuable tools that can help you compute all kinds of housing-related expenses. As you think about whether it makes sense to refinance and how large a monthly payment you can afford, an online refinance calculator will be a helpful tool. 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 planning and careful consideration. By taking good care of your credit score, reducing your debts, and carefully comparing mortgage refinance rates and total costs from multiple lenders, you can make an important decision and qualify for the best available rate in North Carolina.
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
Are refinance rates going to drop?
No one can definitively predict future mortgage rates, but you can look at key indicators to try to get a sense of where interest rates are headed. If the 10-year Treasury Note rate is rising, the housing market is hot, or the economy is generally strong, it’s unlikely that rates will fall in the near future. Keep close watch on the current refinance rates in North Carolina so you’ll know when the time to refinance is right for you.
Can you lower your mortgage interest rate without refinancing?
It’s hard to lower a mortgage interest rate without a refinance, but you can lower your monthly payments by requesting a mortgage recast from your lender. You’ll make a lump-sum payment toward your principal balance, and then your lender will “recast” your monthly payment amount to reflect the lower principal. There is sometimes a small charge of $500 or less for this service. If you’re facing financial hardship, you could also explore a loan modification. Of course, if you have a solid credit score and stellar payment history, you can always ask your lender to modify your rate, but the lender may suggest a refi or recast instead.
Can I take out a home equity loan without refinancing?
You have the power to tap into your home’s equity without altering your current mortgage rate. You can use a home equity line of credit (HELOC) or a home equity loan to access your equity. Shop around for home equity lending rates to make sure you’re getting the best deal for your financial situation, just as you would shop around for a home loan or a refinance rate.
How much are closing costs on a refinance?
On average, closing costs typically fall somewhere between 2% and 5% of the total loan amount. To illustrate, if you were to refinance a $250,000 mortgage, you could expect to pay anywhere from $5,000 to $12,500 in closing costs. It is important to note that these figures serve as a general guideline, and actual costs may vary depending on several factors, including the specific lender, type of loan, and location. Therefore, it is advisable to research and compare different lenders to obtain the most competitive rates and terms for your specific situation.
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.
²SoFi Bank, N.A. NMLS #696891 (Member FDIC), offers loans directly or we may assist you in obtaining a loan from SpringEQ, a state licensed lender, NMLS #1464945.All loan terms, fees, and rates may vary based upon your individual financial and personal circumstances and state.You should consider and discuss with your loan officer whether a Cash Out Refinance, Home Equity Loan or a Home Equity Line of Credit is appropriate. Please note that the SoFi member discount does not apply to Home Equity Loans or Lines of Credit not originated by SoFi Bank. Terms and conditions will apply. Before you apply, please note that not all products are offered in all states, and all loans are subject to eligibility restrictions and limitations, including requirements related to loan applicant’s credit, income, property, and a minimum loan amount. Lowest rates are reserved for the most creditworthy borrowers. Products, rates, benefits, terms, and conditions are subject to change without notice. Learn more at SoFi.com/eligibility-criteria. Information current as of 06/27/24.In the event SoFi serves as broker to Spring EQ for your loan, SoFi will be paid a fee. 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 Much Does It Cost to Refinance a Mortgage?
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How to Refinance a Home Mortgage Loan
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7 Signs It’s Time for a Mortgage Refinance