A few notable mortgage rates went down today. While 15-year fixed mortgage rates moved higher, interest rates on 30-year fixed-rate mortgages decreased. The average rate of the most common type of variable-rate mortgage, the 5/1 adjustable-rate mortgage, slid lower. Although mortgage rates fluctuate, they are at a historic low. If you plan to finance a house, now might be a good time to secure a fixed rate. But as always, make sure to first take into account your personal goals and circumstances before buying a home, and shop around for a lender who can best meet your needs.
30-year fixed-rate mortgages
The average 30-year fixed mortgage interest rate is 3.18%, which is a decline of 2 basis points as seven days 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 usually have a greater 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 2.46%, which is an increase of 3 basis points compared to a week ago. You'll definitely have a larger 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, if you can 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 adjustable-rate mortgage has an average rate of 3.18%, a fall of 3 basis points from the same time last week. With an ARM mortgage, you'll usually get a lower interest rate than a 30-year fixed mortgage for the first five years. However, you may end up paying more after that time, depending on the terms of your loan and how the rate shifts with the market rate. For borrowers who plan to sell or refinance their house before the rate changes, an adjustable-rate mortgage might be a good option. 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 data collected by Bankrate, 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 nationwide:
Today's mortgage interest rates
| Loan term | Today's Rate | Last week | Change |
|---|---|---|---|
| 30-year mortgage rate | 3.18% | 3.20% | -0.02 |
| 15-year fixed rate | 2.46% | 2.43% | +0.03 |
| 30-year jumbo mortgage rate | 2.80% | 2.80% | N/C |
| 30-year mortgage refinance rate | 3.16% | 3.17% | -0.01 |
Rates accurate as of Oct. 22, 2021.
How to find the best mortgage rates
You can get a personalized mortgage rate by connecting with your local mortgage broker or using an online calculator. When researching home mortgage rates, take into account your goals and current finances. Specific interest rates will vary based on factors including credit score, down payment, debt-to-income ratio and loan-to-value ratio. Generally, you want a good credit score, a higher down payment, a lower DTI and a lower LTV to get a lower interest rate. The interest rate isn't the only factor that affects the cost of your home — be sure to also consider other factors such as fees, closing costs, taxes and discount points. Be sure to comparison shop with multiple lenders -- like credit unions and online lenders in addition to local and national banks -- in order to get a mortgage that's the best fit for you.
How does the loan term impact my mortgage?
When picking a mortgage, you should 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. Another important distinction is between fixed-rate and adjustable-rate mortgages. The interest rates in a fixed-rate mortgage are set for the duration 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 (typically five, seven or 10 years). After that, the rate adjusts annually based on the current interest rate in the market.
One thing to think about when choosing between a fixed-rate and adjustable-rate mortgage is how long you plan on staying in your house. Fixed-rate mortgages might be a better fit for those who plan on staying in a home for a while. 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 aren't planning to keep your new home for more than three to 10 years, though, an adjustable-rate mortgage might give you a better deal. The best loan term is entirely dependent on your specific situation and goals, so make sure to take into consideration what's important to you when choosing a mortgage.
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October 22, 2021 at 08:00PM
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Current mortgage interest rates on Oct. 22, 2021: Rates fall - CNET
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