A variety of important mortgage rates saw growth today. While 15-year fixed mortgage rates trailed off, interest rates on 30-year fixed mortgages made gains. The average rate of the most common type of variable-rate mortgage, the 5/1 adjustable-rate mortgage, climbed higher. Mortgage interest rates are never set in stone, but interest rates are historically low. If you plan to finance a home, now might be a great time to lock in a fixed rate. Before you buy a home, remember to take into account your personal needs and financial situation, and compare offers from various lenders to find the best one for you.
30-year fixed-rate mortgages
For a 30-year, fixed-rate mortgage, the average rate you'll pay is 3.03%, which is an increase of 1 basis point compared to one week ago. (A basis point is equivalent to 0.01%.) The most frequently used loan term is a 30-year fixed mortgage. A 30-year fixed mortgage will typically have a greater interest rate than a 15-year fixed rate mortgage -- but also a lower monthly payment. Although you'll pay more interest over time -- you're paying off your loan over a longer timeframe -- if you're looking for a lower monthly payment, a 30-year fixed mortgage may be a good option.
15-year fixed-rate mortgages
The average rate for a 15-year, fixed mortgage is 2.30%, which is a decrease of 1 basis point from the same time last week. Compared to a 30-year fixed mortgage, a 15-year fixed mortgage with the same loan value and interest rate will have a larger monthly payment. But a 15-year loan will usually be the better deal, if you can afford the monthly payments. You'll typically get a lower interest rate, and you'll pay less interest in total because you're paying off your mortgage much quicker.
5/1 adjustable-rate mortgages
A 5/1 ARM has an average rate of 3.05%, an addition of 2 basis points compared to a week ago. With an ARM mortgage, you'll typically get a lower interest rate than a 30-year fixed mortgage for the first five years. But since the rate adjusts with the market rate, you might end up paying more after that time, as described in the terms of your loan. If you plan to sell or refinance your house before the rate changes, an adjustable-rate mortgage might make sense for you. But if that's not the case, you may be on the hook for a much higher interest rate if the market rates change.
Mortgage rate trends
We use information collected by Bankrate, which is owned by the same parent company as CNET, to track daily mortgage rate trends. This table summarizes the average rates offered by lenders across the US:
Current average mortgage interest rates
| Loan type | Interest rate | A week ago | Change |
|---|---|---|---|
| 30-year fixed rate | 3.03% | 3.02% | +0.01 |
| 15-year fixed rate | 2.30% | 2.31% | -0.01 |
| 30-year jumbo mortgage rate | 2.79% | 2.79% | N/C |
| 30-year mortgage refinance rate | 3.00% | 2.99% | +0.01 |
Updated on Sept. 23, 2021.
How to find personalized mortgage rates
To find a personalized mortgage rate, speak to your local mortgage broker or use an online mortgage service. When researching home mortgage rates, consider your goals and current finances. Specific mortgage rates will vary based on factors including credit score, down payment, debt-to-income ratio and loan-to-value 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. Beyond the mortgage interest rate, other factors including closing costs, fees, discount points and taxes might also impact the cost of your house. Make sure you talk to several different lenders -- including local and national banks, credit unions and online lenders -- and comparison shop to find the best mortgage loan for you.
How does the loan term impact my mortgage?
When picking a mortgage, it's important to consider the loan term, or payment schedule. The most common mortgage terms are 15 years and 30 years, although 10-, 20- and 40-year mortgages also exist. Mortgages are further divided into fixed-rate and adjustable-rate mortgages. For fixed-rate mortgages, interest rates are set for the life of the loan. Unlike a fixed-rate mortgage, the interest rates for an adjustable-rate mortgage are only the same for a certain amount of time (usually five, seven or 10 years). After that, the rate adjusts annually based on the market interest rate.
One factor to consider when choosing between a fixed-rate and adjustable-rate mortgage is the length of time you plan on staying in your house. For those who plan on staying long-term in a new house, fixed-rate mortgages may be the better option. Fixed-rate mortgages offer more stability over time compared to adjustable-rate mortgages, but adjustable-rate mortgages may offer lower interest rates upfront. If you don't have plans to keep your new home for more than three to 10 years, though, an adjustable-rate mortgage could give you a better deal. The best loan term is entirely dependent on your own situation and goals, so be sure to think about what's important to you when choosing a mortgage.
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September 23, 2021 at 08:00PM
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Current mortgage rates for Sept. 23, 2021: Rates trend higher - CNET
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