Lately, I’ve been getting the same question over and over: “Should I refinance my mortgage now?” My answer? It depends—but for the first time in a while, the math is starting to make sense again. If you play it right, refinancing in 2025 could be your most powerful financial move this year.

Refinancing in 2025: What’s Driving the Surge—and How to Take Advantage

According to Fannie Mae, refinance applications are up 31% year-over-year—a clear sign that homeowners are waking up to the potential savings in today’s evolving rate environment. As of June 2025, the national average APR on a 30-year refi is around 6.89%, while 15-year rates have dipped to 6.16%.
The latest rankings from  reveal top lenders like Truist, Pennymac, and TD Bank offering competitive products across conventional Loans , VA, FHA, and jumbo loans.

What This Means for You: 4 Key Takeaways

1. Rate Drops Are Breathing Life Back Into Refinancing

It’s not 2021-low, but it’s better than 2024. If you locked in a rate when inflation was roaring, you might now qualify for a full percentage point lower—which can mean thousands in savings over the life of the loan.
Even a drop from 7.5% to 6.5% on a $300,000 loan could save you over $200/month.

2. Lender Selection Matters More Than Ever

Don’t just chase rates—look at loan costs, DTI flexibility, and customer experience.
Truist leads with low debt-to-income (DTI) requirements, while Fifth Third Bank stands out with the lowest loan costs. If you’re refinancing a VA or FHA loan, Pennymac may offer the lowest median interest rates, but their customer satisfaction lags.

3. Cash-Out Refis Are Back—With Caution

With $33 trillion in home equity nationwide, many are tapping into their property’s value to consolidate debt or fund major expenses. But keep in mind: you’re turning equity into debt, and if home values dip, you could get stuck underwater.

4. Online Tools Are Making Comparison Easier

U.S. Bank’s Financial IQ platform is one of the best for self-education and rate modeling. TD Bank’s Home Loan Match Tool helps personalize loan options based on your profile.
In 2025, you don’t need to walk into a branch to make an informed decision—but you do need to click with caution.

If You’re Considering a Refi, Here’s What I’d Do Right Now:

• Know Your Goal First: Are you looking to lower monthly payments? Tap equity? Pay off the loan faster? Your reason should guide your lender and loan type.
• Shop At Least 3 Lenders: Yes, it takes time. But preapprovals won’t hurt your score if done within a short window. Compare total loan costs, not just rates.
• Don’t Skip the Break-Even Math: How long will it take for your savings to surpass your closing costs? If it’s more than 3–5 years, and you plan to sell or move, it might not be worth it.

Quick Explainer:

What Are the Best Mortgage Refinance Lenders Right Now?

These are lenders recognized for offering competitive rates, lower fees, or specialized products (like VA or jumbo refinances). In 2025, Truist, Pennymac, and TD Bank are among the top-rated based on Yahoo Finance’s in-depth analysis of cost, variety, and borrower-friendly features.

Final Word of Caution—and Opportunity

Refinancing isn’t just about saving—it’s about strategy. With inflation cooling, equity at record highs, and more lender tools than ever, the door to meaningful savings is open—but only if you walk through it carefully. As someone who’s helped many clients refinance over the years, here’s what I know for sure A well-timed refinance can change your financial trajectory. But a rushed one can set you back years. Know your numbers. Know your options. Then make your move.

Reader Q&A

Is it better to refinance with my current lender?

Not always. Give them a chance, but compare 3–4 offers—your loyalty shouldn’t cost you money.

Can I refinance with bad credit?

Yes—FHA, VA, and USDA streamline refis are built for borrowers with lower scores. Start there if your credit isn’t perfect.

Will refinance rates go lower in 2025?

Possibly. The Federal Reserve has hinted at future cuts, but rates fluctuate daily. Lock in if the deal makes sense now—trying to time the market can backfire.