30-year mortgage refinance rate averages 6.55% on July 1

The average 30-year fixed mortgage refinance rate stood at 6.54% based on Zillow data reviewed as of July 2, with shorter-term conventional refinance loans priced lower and jumbo loans higher. Conventional refinance rates were 6.59% for 20-year loans, 5.80% for 15-year loans, and 5.83% for 10-year loans, while jumbo refinance rates were 6.91% for 30-year loans and 6.75% for 15-year loans. Government-backed options were lower, with FHA loans at 6.33% for 30-year terms and 5.38% for 15-year terms, and VA loans at 5.72% and 5.63%, respectively. Refinancing replaces an existing mortgage with a new loan and typically requires borrowers to meet lender standards on credit, income verification, and debt-to-income ratio (DTI, debt payments relative to income). The process can slightly reduce a credit score because of a hard inquiry, and approval is not guaranteed. The report says mortgage rates stayed near 7% for 30-year fixed loans nationwide even after late-2024 Federal Reserve rate cuts, remaining far above the 2% to 3% levels seen during the pandemic. Redfin said that as of the third quarter of 2024, 82.8% of homeowners with mortgages had rates below 6%, a dynamic tied to the lock-in effect, where borrowers are reluctant to move or refinance because they already hold much cheaper loans. Rates moved lower in late August and early September 2025 ahead of the Fed's Sept. 16-17 meeting, followed by quarter-point cuts in September, late October, and early December. Rates later rose in March 2026 after the Trump administration launched Operation Epic Fury in Iran at the end of February, alongside higher gas prices and broader economic uncertainty. They briefly appeared set to fall after the United States and Iran announced a ceasefire in June 2026, but have remained elevated overall. Refinancing may make sense when a borrower can secure a rate at least a percentage point lower than the current mortgage, wants to access home equity through a cash-out refinance, or aims to change loan term or loan type. The article notes that cash-out refinancing typically requires at least 20% equity. It also highlights that borrowers may refinance from an FHA loan to a conventional loan to remove FHA lifetime mortgage insurance, or from an adjustable-rate mortgage to a fixed-rate mortgage to reduce exposure to future rate increases. Closing costs generally range from 2% to 6% of the loan amount, or about $6,000 to $18,000 on a $300,000 loan, and can include origination, appraisal, title, application, survey, attorney, recording, and possible prepayment penalty costs. Borrowers are not required to refinance with their current lender, though some lenders may offer incentives to retain the loan, and mortgages purchased by Fannie Mae or Freddie Mac may qualify for Refi Now or Refi Possible.