A few significant mortgage rates boasted increases today. The average interest rates for both 15-year fixed and 30-year fixed mortgages both drifted higher. The average rate of the most common type of variable-rate mortgage, the 5/1 adjustable-rate mortgage, also increased. Mortgage interest rates are never set in stone, but interest rates are at historic lows. Because of this, right now is an optimal time for prospective homebuyers to get a fixed rate. Before you buy a house, remember to think about your personal needs and financial situation, and compare offers from various lenders to find the right one for you.
Check out mortgage rates that meet your distinct needs
30-year fixed-rate mortgages
The 30-year fixed-mortgage rate average is 3.34%, which is a growth of 10 basis points compared to one week ago. (A basis point is equivalent to 0.01%.) 30-year fixed mortgages are the most frequently used 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 2.54%, which is an increase of 6 basis points compared to a week ago. Compared to a 30-year fixed mortgage, a 15-year fixed mortgage with the same loan value and interest rate will have a bigger monthly payment. But a 15-year loan will usually be the better deal, if you’re able to 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 3.37%, a climb of 10 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, since the rate adjusts with the market rate, you may end up paying more after that time, as described in the terms of your loan. Because of this, an adjustable-rate mortgage may be a good option if you plan to sell or refinance your house before the rate changes. But if that’s not the case, you may be on the hook for a significantly 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 changes in these daily rates. This table summarizes the average rates offered by lenders nationwide:
Average mortgage interest rates
|30-year jumbo mortgage rate||3.10%||3.07%||+0.03|
|30-year mortgage refinance rate||3.41%||3.34%||+0.07|
Rates as of March 23, 2021.
How to find the best mortgage rates
When you are ready to apply for a loan, you can reach out to a local mortgage broker or search online. In order to find the best home mortgage, you’ll need to consider your goals and overall 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. Generally, you want a good credit score, a larger down payment, a lower DTI and a lower LTV to get a lower interest rate. Beyond the mortgage rate, other costs including closing costs, fees, discount points and taxes might also factor into the cost of your home. Make sure you speak with several different lenders — such as local and national banks, credit unions and online lenders — and comparison shop to find the best mortgage loan for you.
What’s the best loan term?
One important factor to consider when choosing a mortgage is 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. The interest rates in a fixed-rate mortgage are set for the duration of the loan. For adjustable-rate mortgages, interest rates are stable for a certain number of years (typically five, seven or 10 years), then the rate fluctuates annually based on the current interest rate in the market.
One important factor to take into consideration when choosing between a fixed-rate and adjustable-rate mortgage is the length of time you plan on living in your home. Fixed-rate mortgages might be a better fit for people who plan on living in your new home for quite some time. While adjustable-rate mortgages might offer lower interest rates upfront, fixed-rate mortgages are more stable in the long term. If you aren’t planning to keep your new house for more than three to 10 years, though, an adjustable-rate mortgage may give you a better deal. The “best” loan term all depends on your situation and goals, so be sure to take into consideration what’s important to you when choosing a mortgage.
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