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Some closely tracked mortgage rates have come down today. The 15 year fixed mortgage rate and the 30 year fixed mortgage rate both fell. We also saw a decrease in the average rate on 5/1 variable rate mortgages. Although mortgage rates fluctuate, they are lower than in recent years. If you’re looking to secure a fixed price, now is a good time to buy a home. Before buying a home, remember to consider your personal needs and financial situation, and compare offers from different lenders to find the one that is right for you.
Find current mortgage rates for today
30 year fixed rate mortgage
For a 30-year fixed-rate mortgage, the average interest rate is 3.06%, which is a 5 basis point decrease from seven days ago. (One basis point is 0.01%.) 30-year fixed-rate mortgages are the most common loan term. A 30-year fixed-rate mortgage usually has a lower monthly payment than a 15-year mortgage – but often a higher interest rate. You can’t pay off your home that quickly and you will pay more interest over time. However, a 30 year fixed rate mortgage is a great option if you want to minimize your monthly payment.
15 year fixed rate mortgage
The average rate on a 15-year fixed-rate mortgage is 2.34%, down 5 basis points from seven days ago. You definitely have a larger monthly payment with a 15 year fixed rate mortgage compared to a 30 year fixed rate mortgage, even if the interest rate and loan amount are the same. However, if you can afford the monthly payments, then a 15 year loan offers several advantages. You will usually get a lower interest rate and pay less overall interest because you will pay off your mortgage much faster.
5/1 adjustable rate mortgages
A 5/1 ARM has an average rate of 3.07%, down 6 basis points from seven days ago. For the first five years of the mortgage, you will typically get a lower interest rate (compared to a 30-year fixed-rate mortgage) with a 5/1 variable rate mortgage. However, because the interest rate changes with the market rate, you may be able to pay more after that time, as detailed in the terms of your loan. For borrowers planning to sell or refinance their home before the interest rate changes, an adjustable rate mortgage may be a good option. If not, market shifts can increase your interest rate significantly.
Mortgage rate development
We use the data collected by Bankrate, owned by the same parent company as CNET, to track rate changes over time. This table summarizes the average interest rates offered by lenders across the country:
Average mortgage rates
|Fixed for 15 years||2.34%||2.39%||-0.05|
|30 year jumbo mortgage rate||3.16%||3.26%||-0.10|
|30 year refinancing rate for mortgages||3.12%||3.17%||-0.05|
Prices from May 10, 2021.
How to Find Personalized Mortgage Rates
You can get a personalized mortgage rate by contacting your local mortgage broker or using an online calculator. As you study mortgage rates, think about your goals and current finances. The specific mortgage rates vary based on factors such as your credit score, down payment, debt-to-income ratio, and credit-to-value ratio. In general, you want a good credit score, higher down payment, lower DTI, and lower LTV in order to get a lower interest rate. The interest rate isn’t the only factor that affects the cost of your home. Also consider other factors such as fees, closing costs, taxes, and discount points. You should check out multiple lenders – for example, credit unions and online lenders alongside local and national banks – to get a mortgage that best suits you.
How does the term of the loan affect my mortgage?
An important factor to consider when choosing a mortgage is the loan term or payment schedule. The most common mortgage terms on offer are 15 years and 30 years, although you can also find mortgages with terms of 10, 20, and 40 years. Another important difference is between fixed rate and adjustable rate mortgages. The interest rates on a fixed rate mortgage are set for the life of the loan. With variable rate mortgages, the interest rates are the same for a certain number of years (usually five, seven, or ten years). The interest rate then fluctuates annually based on the current market interest rate.
When choosing between a fixed rate mortgage and a variable rate mortgage, consider how long you plan to live in your home. For people looking to live in a new home for the long term, fixed rate mortgages may be a better option. Fixed rate mortgages offer more stability over time compared to adjustable rate mortgages, but adjustable rate mortgages can offer lower interest rates upfront. However, you could get a better deal on an adjustable rate mortgage if you only plan to keep your home for a few years. As a rule of thumb, there is no “best” loan term. It all depends on your goals and your current financial situation. It is important that you do your research and know what you want when choosing a mortgage.
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