A few major mortgage rates dropped today. The average interest rates for both 15-year fixed and 30-year fixed mortgages had a downswing. For variable rates, the 5/1 adjustable-rate mortgage also trended down. Mortgage interest rates are never set in stone, and interest rates are at historic lows. Because of this, right now is an ideal time for prospective homebuyers to lock in a fixed rate. But as always, make sure to first consider your personal goals and circumstances before buying a home, and shop around to find a lender who can best meet your needs.
30-year fixed-rate mortgages
The average interest rate for a standard 30-year fixed mortgage is 3.14%, which is a decline of 5 basis points from 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 rate mortgage will usually have a smaller monthly payment than a 15-year one -- but usually a higher interest rate. 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 2.44%, which is a decrease of 2 basis points compared to a week ago. 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, if you can afford the monthly payments, there are several benefits to a 15-year loan. These include typically 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 3.13%, a fall of 5 basis points compared to a week ago. For the first five years, you'll usually get a lower interest rate with a 5/1 adjustable-rate mortgage compared to a 30-year fixed mortgage. But since the rate shifts with the market rate, you could 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 ARM could make sense for you. If not, shifts in the market may significantly increase your interest rate.
Mortgage rate trends
We use information 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:
Current average mortgage interest rates
| Loan type | Interest rate | A week ago | Change |
|---|---|---|---|
| 30-year fixed rate | 3.14% | 3.19% | -0.05 |
| 15-year fixed rate | 2.44% | 2.46% | -0.02 |
| 30-year jumbo mortgage rate | 2.76% | 2.80% | -0.04 |
| 30-year mortgage refinance rate | 3.13% | 3.16% | -0.03 |
Updated on Dec. 6, 2021.
How to find personalized mortgage rates
When you are ready to apply for a loan, you can connect with a local mortgage broker or search online. Make sure to take into accountyour current financial situation and your goals when trying to find a mortgage. Things that affect what mortgage interest rate you might get include: your credit score, down payment, loan-to-value ratio and your debt-to-income ratio. Generally, you want a higher credit score, a higher down payment, a lower DTI and a lower LTV to get a lower interest rate. Apart from the mortgage interest rate, other costs including closing costs, fees, discount points and taxes might also affect the cost of your house. Be sure to talk to several different lenders -- including local and national banks, credit unions and online lenders -- and comparison shop to find the best loan for you.
How does the loan term impact my mortgage?
One important factor to consider 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. The interest rates in a fixed-rate mortgage are stable for the duration of the loan. Unlike a fixed-rate mortgage, the interest rates for an adjustable-rate mortgage are only fixed for a certain amount of time (most frequently five, seven or 10 years). After that, the rate fluctuates annually based on the market interest rate.
When deciding between a fixed-rate and adjustable-rate mortgage, you should consider how long you plan to stay in your house. Fixed-rate mortgages might be a better fit if you plan on staying in a home for a while. Fixed-rate mortgages offer greater 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 may give you a better deal. The best loan term all is entirely dependent on your specific situation and goals, so make sure to think about what's important to you when choosing a mortgage.
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December 06, 2021 at 09:00PM
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Current mortgage rate for Dec. 6, 2021: Rates decreased - CNET
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