The average rate on a 30-year fixed-rate mortgage in 2020 was 3.38%. If we look back 10 years, the average was 4.67% and if we look back even further to 2001, 20 years ago, the average 30-year fixed rate was over 7%.
With these numbers alone, it's easy to see the advantages of refinancing, especially for homeowners with mortgages from 10+ years ago. However, even if we look at trends from 2019, 2018, and on, it becomes pretty clear that rates today are near historical lows, making refinancing even more advantageous to homeowners.
A Freddie Mac survey from March 2020 found that borrowers who refinanced their 30-year fixed-rate mortgage to a similar 30-year fixed-rate saved over $2,800 in annual mortgage payments. The average borrower lowered their rate from 4.3% to 3.1% (Source)
So, yes, it really is that simple, the biggest advantage of refinancing your mortgage is that it can save you $1000's every year. However, saving money isn't the only advantage of refinancing, you can also use the opportunity to borrow money if you need it. By using your home's equity as collateral, you'll be able to borrow money with much lower rates when compared to a typical personal loan. If you're interested in cash-out refinancing, check out our list of th top rated home equity lenders here