A variety of notable mortgage rates sank today. The averages for both 30-year fixed and 15-year fixed mortgages were slashed. For variable rates, the 5/1 adjustable-rate mortgage (ARM) notched higher.
The averages for 30-year fixed, 15-year fixed, and 5/1 ARMs are:
Current Mortgage Refinance Rates
There’s good news if you’ve been considering a refinance, because the average rates for 15-year fixed and 30-year fixed refinance loans trailed off. Shorter term, 10-year fixed-rate refinance mortgages also decreased.
Today’s refinance rates are:
Compare national home loan rates from various lenders .
30-Year Fixed-Rate Mortgage Rates
The median interest rate for a standard, 30-year, fixed mortgage is 3.08%, which is a decrease of 2 basis points from last week.
You can use NextAdvisor’s home loan calculator to get an idea of what your monthly payments will be and play around with extra mortgage payments to wrap your head around how much you could save. The mortgage calculator can also show you all of the interest you’ll pay over the life of the loan
15-Year Fixed-Rate Mortgage Rates
The median rate for a 15-year fixed mortgage is 2.36%, which is a decrease of 1 basis point from seven days ago.
A 15-year, fixed-rate mortgage’s monthly payment is larger than what you would pay with a 30-year mortgage. But, 15-year loans have some considerable benefits: You’ll save thousands of dollars in interest and pay off your loan much sooner.
5/1 Adjustable-Rate Mortgage Rates
A 5/1 ARM has an average rate of 3.24%, which is a rise of 8 basis points from seven days ago.
An adjustable-rate mortgage is ideal for individuals who will sell or refinance before the rate changes. If that’s not the case, their interest rates could end up being noticeably higher after a rate adjusts.
For the first five years, a 5/1 ARM will typically have a lower interest rate compared to a 30-year fixed mortgage. Just keep in mind that your rate could climb higher and your payment might grow by hundreds of dollars a month.
Mortgage Rate Trends
To see where mortgage rates are moving rely on information collected by Bankrate, which is owned by the same parent company as NextAdvisor. Looking at the history of mortgage rates, we’re seeing low rates like never before. This table has current average rates based on information provided to Bankrate by lenders from across the country:
Updated on June 14, 2021.
There isn’t a single factor that causes mortgage rates to move, but rather there are many. Chief among them are things including inflation and even the unemployment rate. When you see inflation increasing, that usually means mortgage rates are about to climb higher. On the other hand, lower inflation typically accompanies lower mortgage rates. With higher inflation, the dollar becomes less valuable. This scenario pushes buyers away from mortgage-backed securities, which leads to price decreases and the need for increasing yields. And higher yields require borrowers to pay higher interest rates.
The Federal Reserve Bank can also influence rates, although it doesn’t directly set mortgage interest rates. Currently, the Federal Reserve is purchasing billions of dollars in mortgage-backed securities (MBS) each month. This increased demand for MBS has helped to keep rates from increasing and should continue to do so until the Federal Reserve announces it will taper its purchase of MBS.
Should I Lock in My Mortgage Rate Now?
Mortgage rates move up and down on a daily basis, and it’s impossible to time the market. So locking in your interest rate right now is a good idea because overall, rates are exceptionally low.
When you lock in your rate, ask your lender how long the lock is valid for. A rate lock can be good for anywhere from 30 to 60 days, which typically will give you enough time to close before the lock expires. If something happens where you need to extend your rate lock, ask about fees as many lenders charge a fee for extending a rate lock.
What Does the Future Hold for Mortgage Rates?
To start the year, mortgage rates spiked and crossed 3% for the first time since July 2020. After this dramatic increase, we saw a fall that brought rates back under 3%. With rates hovering around 3%, they are still near or below the levels many experts expected mortgage rates to be at in 2021.
The direction rates go will depend on the economy. And effectively dealing with the impacts of the coronavirus pandemic should boost our economic recovery. As the economy recovers, we should see inflation rise, which will put upward pressure on mortgage rates. But in spite of the potential for rising inflation, it’s unlikely that we’ll see skyrocketing mortgage rates in 2021. One reason for this: the Federal Reserve believes that low interest rates will help the economy rebound. So it’s likely to make policy decisions in favor of keeping rates low.
2021 Mortgage Rate Forecast
In the near term, any changes in mortgage rates should be moderate. So rates should hover near 3% for the time being.
While there is nothing this week that should cause a spike or dramatic downturn in rates, the unexpected can happen. And currently, the economy still has a long way to go to return to its pre-pandemic level.
How to Qualify for the Lowest Mortgage Rate
Shopping around for a mortgage is one of the best ways to qualify for the lowest mortgage rate.
Your mortgage rate depends on a variety of factors lenders consider when assessing how the likelihood that you’ll be able to afford a mortgage for the long term. Your credit score and debt-to-income ratio (DTI) are a big part of this decision. And even the value of the property compared to the size of your mortgage is important. So putting more money into your down payment can reduce your interest rate.
But lenders will look at your situation differently. So you can provide the same documentation to three different lenders, and receive mortgage offers with vastly different rates and fees.
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June 14, 2021 at 06:30PM
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Current Mortgage Rates, June 14, 2021 | Rates Decreased - NextAdvisor
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