Multiple closely watched mortgage rates climbed higher today. The average rates on 30-year fixed and 15-year fixed mortgages both climbed higher. Meanwhile, the average rate on 5/1 adjustable-rate mortgages sunk lower.
Rates for mortgages are constantly changing, but they remain low by historical standards. If you’re in the market for a mortgage, it may be a great time to lock in a rate. Just make sure you’ve looked around for the best rate first.
Find the right mortgage rate for your specific criteria.
30-year fixed mortgages
The average rate you’ll pay for a 30-year fixed mortgage is 3.03 percent, up 1 basis point since the same time last week. This time a month ago, the average rate on a 30-year fixed mortgage was lower, at 3.01 percent.
At the current average rate, you’ll pay $423.22 per month in principal and interest for every $100,000 you borrow. That’s an additional $0.54 per $100,000 compared to last week.
You can use Bankrate’s mortgage payment calculator to estimate your monthly payments and see how much you’ll save by adding extra payments. It will also help you calculate how much interest you’ll pay over the life of the loan.
15-year fixed mortgages
The average 15-year fixed-mortgage rate is 2.56 percent, up 1 basis point since the same time last week.
Monthly payments on a 15-year fixed mortgage at that rate will cost around $670 per $100,000 borrowed. That’s obviously much higher than the monthly payment would be on a 30-year mortgage at that rate, but it comes with some big advantages: You’ll come out several thousand dollars ahead over the life of the loan in total interest paid and build equity much more quickly.
The average rate on a 5/1 adjustable rate mortgageis 3.06 percent, falling 4 basis points over the last week.
These loan types are best for people who expect to refinance or sell before the first or second adjustment. Rates could be much higher when the loan first adjusts, and thereafter.
Monthly payments on a 5/1 ARM at 3.06 percent would cost about $425 for each $100,000 borrowed over the initial five years, but could ratchet higher by hundreds of dollars afterward, depending on the loan’s terms.
Where rates are headed
To see where Bankrate’s panel of experts expect rates to go from here, check out our Mortgage rate predictions for this week.
Want to see where rates are right now? Lenders nationwide respond to Bankrate.com’s weekday mortgage rates survey to bring you the most current rates available. Here you can see the latest marketplace average rates for a wide variety of purchase loans:
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 2.56% 2.55% -0.01
30-year fixed jumbo rate 3.09% 3.06% +0.03
30-year fixed refinance rate 3.20% 3.13% +0.07
Updated on October 22, 2020.
Should you lock a mortgage rate?
A rate lock guarantees your interest rate for a specified period of time. Lenders often offer 30-day rate locks for a nominal fee or roll the price of the lock into your loan. Some lenders will lock rates for longer periods, even exceeding 60 days, but those locks can be expensive. In today’s volatile market, some lenders will lock an interest rate for only two weeks because they don’t want to take on unnecessary risk.
With a rate lock, if interest rates rise, you’re locked into the guaranteed rate. You may be able to find a lender that offers a floating rate lock. A floating rate lock lets you get a lower rate if interest rates decline before closing your loan. It could be worth the cost in a declining rate environment. Because mortgage rates are not predictable, there’s no guarantee that rates will stay where they are from week to week or even day to day. So, if you can lock in a low rate, then you should do so rather than gamble on interest rates falling even lower.
Keep in mind that during the pandemic, all aspects of real estate and mortgage closings are taking much longer than usual. Expect the closing on a new mortgage to take at least 60 days, and expect refinancing to take at least a month.
What causes mortgage rates to change
A number of economic factors influence mortgage rates. Among them are inflation and unemployment. Higher inflation typically leads to higher mortgage rates. The opposite is also true; when inflation is low, mortgage rates typically are as well. As inflation increases, the dollar loses value. That drives investors away from mortgage-backed securities (MBS), which causes the prices to decrease and yields to increase. When yields move higher, rates become more expensive for borrowers.
A strong economy usually means more people buying homes, which drives demand for mortgages. This increased demand can push rates higher. The opposite is also true; less demand can trigger a drop in rates.
Are mortgage rates rising or falling?
Mortgage rates have hovered around all-time lows in recent months, but where they go from here is nearly impossible to predict. Much depends on the direction of the economy, and how well public health officials can contain the coronavirus pandemic. Most experts predict that if the economy continues to bounce back and drugmakers develop a successful vaccine, mortgage rates will increase. However, if the economy suffers pandemic-related setbacks, rates will stay low or even fall further.
How do mortgage rates affect homebuyers?
In a housing boom, low mortgage rates can present pros and cons for borrowers. One pro: Low rates give borrowers more buying power. A $300,000 loan at 4 percent equates to a monthly payment of $1,432. If rates fall to 3 percent, the payment plunges to $1,265.
One downside, however, is that a significant decline in mortgage rates can help push up home prices. Indeed, home values have increased in recent months.
Here’s an example to show how soaring home prices and plunging mortgage rates can have offsetting effects. Let’s say you chose not to buy a $300,000 home a year ago, when the 30-year mortgage rate was around 3.75 percent. Your 20 percent down payment would’ve been $60,000 and your monthly payment would’ve been $1,111.
Today, the price of the same home has jumped to $335,000, but you can land a 30-year loan at 3 percent. As a result, your monthly payment rises only slightly, to $1,130. However, you’ll have to come up with an extra $7,000 to make a 20 percent down payment.
Is now a good time to buy a house?
There’s never a straightforward answer to this question. It always depends. Do you have a reliable income, a good credit score and money saved for a down payment and repairs? If you can answer all of those questions affirmatively, you’re ready to buy.
However, the pandemic has exacerbated a shortage of homes, leading to bidding wars and rising prices. Those trends mean it can be a frustrating market for buyers.
Methodology: The rates you see above are Bankrate.com Site Averages. These calculations are run after the close of the previous business day and include rates and/or yields we have collected that day for a specific banking product. Bankrate.com site averages tend to be volatile — they help consumers see the movement of rates day to day. The institutions included in the “Bankrate.com Site Average” tables will be different from one day to the next, depending on which institutions’ rates we gather on a particular day for presentation on the site.
To learn more about the different rate averages Bankrate publishes, see “Understanding Bankrate’s Rate Averages.”
Mortgage refinance rates today
30 year interest rates today
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Learn more about specific loan type rates
LOAN TYPE PURCHASE RATES REFINANCE RATES
The index above links out to loan-specific pages to help you learn more about rates by loan type.
30-Year Loan 30-Year Mortgage Rates Current 30 Year Refinance Rates
20-Year Loan 20-Year Fixed Mortgage Rates 20-Year Refinance Rates
15-Year Loan 15-Year Mortgage Rates 15-Year Refinance Rates
10-Year Loan 10-Year Mortgage Interest Rates 10-Year Refinance Rates
FHA Loan FHA Mortgage Loan Rates FHA Refinance Interest Rates
VA Loan VA Mortgage Interest Rates VA Mortgage Refinance Rates
ARM Loan Adjustable Rate Mortgage Rates Current ARM Refinance Rates
Jumbo Loan Jumbo Loan Rates Jumbo Refinance Rates