A variety of notable mortgage rates inched up today. The average interest rates for both 15-year fixed and 30-year fixed mortgages both crept higher. The average rate of the most common type of variable-rate mortgage, the 5/1 adjustable-rate mortgage, also trended upward. Although mortgage rates are dynamic, they are lower than they’ve been in years. Because of this, right now is an excellent time for prospective homebuyers to get a fixed rate. Before you buy a home, remember to take into account your personal needs and financial situation, and shop around for multiple lenders to find the best one for you.
Compare national home loan rates from various lenders
30-year fixed-rate mortgages
The 30-year fixed-mortgage rate average is 3.09%, which is a growth of 4 basis points as seven days ago. (A basis point is equivalent to 0.01%.) Thirty-year fixed mortgages are the most common loan term. A 30-year fixed mortgage will typically have a higher interest rate than a 15-year fixed rate mortgage — but also a lower monthly payment. You won’t be able to pay off your house as quickly and you’ll pay more interest over time, but a 30-year fixed mortgage is a good option if you’re looking to minimize your monthly payment.
15-year fixed-rate mortgages
The average rate for a 15-year, fixed mortgage is 2.36%, which is an increase of 1 basis point from the same time last week. You’ll definitely have a bigger monthly payment with a 15-year fixed mortgage compared to a 30-year fixed mortgage, even if the interest rate and loan amount are the same. However, as long as you’re able to afford the monthly payments, there are several benefits to a 15-year loan. These include usually being able to get a lower interest rate, paying off your mortgage sooner, and paying less total interest in the long run.
5/1 adjustable-rate mortgages
A 5/1 ARM has an average rate of 3.11%, an uptick of 4 basis points from seven days ago. With an adjustable-rate mortgage mortgage, you’ll usually get a lower interest rate than a 30-year fixed mortgage for the first five years. However, you might end up paying more after that time, depending on the terms of your loan and how the rate shifts with the market rate. If you plan to sell or refinance your house before the rate changes, an ARM could make sense for you. If not, shifts in the market could significantly increase your interest rate.
Mortgage rate trends
We use information collected by Fintech Zoom, which is owned by the same parent company as CNET, to track rates changes over time. This table summarizes the average rates offered by lenders across the US:
Today’s mortgage interest rates
|loan term||Today’s Rate||Last week||Change|
|30-year mortgage rate||3.09%||3.05%||+0.04|
|15-year fixed rate||2.36%||2.35%||+0.01|
|30-year jumbo mortgage rate||3.16%||3.15%||+0.01|
|30-year mortgage refinance rate||3.15%||3.09%||+0.06|
Rates accurate as of May 18, 2021.
How to shop for the best mortgage rate
To find a personalized mortgage rate, talk to your local mortgage broker or use an online mortgage service. When looking into home mortgage rates, take into account your goals and current financial situation. Things that affect what the interest rate you might get on your mortgage include: your credit score, down payment, loan-to-value ratio and your debt-to-income ratio. Having a higher credit score, a larger down payment, a low DTI, a low LTV, or any combination of those factors can help you get a lower interest rate. Apart from the mortgage interest rate, factors including closing costs, fees, discount points and taxes might also impact the cost of your house. Make sure to shop around with multiple lenders — such as credit unions and online lenders in addition to local and national banks — in order to get a mortgage loan that’s best for you.
What’s the best loan term?
One important consideration when choosing a mortgage is the loan term, or payment schedule. The loan terms most commonly offered are 15 years and 30 years, although you can also find 10-, 20- and 40-year mortgages. Mortgages are further divided into fixed-rate and adjustable-rate mortgages. For fixed-rate mortgages, interest rates are the same for the life of the loan. Unlike a fixed-rate mortgage, the interest rates for an adjustable-rate mortgage are only stable for a certain amount of time (commonly five, seven or 10 years). After that, the rate adjusts annually based on the market interest rate.
One thing to think about when deciding between a fixed-rate and adjustable-rate mortgage is how long you plan on staying in your home. Fixed-rate mortgages might be a better fit for those who plan on staying in a home for a while. While adjustable-rate mortgages may offer lower interest rates upfront, fixed-rate mortgages are more stable over time. However you could get a better deal with an adjustable-rate mortgage if you only plan to keep your home for a couple years. There is no “best” loan term as a rule of thumb; it all depends on your goals and your current financial situation. It’s important to do your research and know what matters to you when choosing a mortgage.