The total interest rate is something new. According to the Consumer Financial Protection Bureau, the TIP tells you how much interest you'll pay over the life of your home loan, compared to the amount you borrowed. When 30-year refinance rates are significantly lower than the current mortgage rate, you may be able to save money with a refinance. However, choosing a mortgage is a very personal decision and there are certain situations in which a 30-year fixed mortgage is not the best option.
This is because the TIP is based on the total interest you would pay over the entire term of the mortgage, while the interest rate and APR are annual rates. Another factor to consider when refinancing is, how many years have you been paying your current mortgage? If you have 10 years of applying for a 30-year loan, applying for a new 30-year mortgage adds those 10 years to your repayment term. This is how the average mortgage interest rate has changed over time, according to data from Freddie Mac. We include both the interest rate and the annual percentage rate (APR), which includes additional fees from lenders, so you can get a better idea of the total cost of the loan.
