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Looking at today’s mortgage rates a number of preeminent rates moved up. Interest rates on 30-year, fixed-rate mortgages climbed higher, while 15-year fixed mortgage rates stayed the same. We also saw an upswing in the average rate of 5/1 adjustable-rate mortgages (ARM).
The average mortgage rates are as follows:
- Today’s average 30-year fixed mortgage rate is 3.10%
- 15-year fixed mortgage rates are averaging 2.37%
- 5/1 ARM rate: 3.16%
Today’s Mortgage Refinance Rates
Interestingly, 30-year fixed refinance rates ticked up, when at the same time national rate averages for a 15-year fixed refinance remained the same. Shorter term, 10-year fixed-rate refinance mortgages were stable.
The refinance averages for 30-year, 15-year, and 10-year loans are:
- The average 30-year fixed-rate refinance currently sits at: 3.16%
- 15-year fixed refinance rate: 2.42%
- 10-year fixed refinance rates are averaging 2.43%
30-Year Fixed-Rate Mortgage Rates
For a 30-year fixed-rate mortgage, the average rate you’ll pay is 3.10%, which is an increase of 2 basis points from the previous week.
You can use NextAdvisor’s mortgage loan calculator to work out what your monthly payments would be and calculate what you’ll save with additional payments. The mortgage calculator can also show you the total interest you’ll pay over the life of the loan
15-Year Fixed-Rate Mortgage Rates
The median rate for a 15-year fixed mortgage is 2.37%, which is the same rate from the same time last week.
A 15-year, fixed-rate mortgage’s monthly payment is, undeniably, a much bigger monthly payment than what you’d get with a 30-year mortgage offering the same interest rate. However, 15-year loans have some considerable benefits: You’ll save thousands of dollars in interest and pay off your loan much earlier.
5/1 Adjustable-Rate Mortgage Rates
A 5/1 ARM has an average rate of 3.16%, which is a rise of 2 basis points from the same time last week.
An adjustable-rate mortgage is ideal for individuals who will refinance or sell before the rate changes. If that’s not the case, their interest rates could end up being significantly higher after a rate adjusts.
For the first five years, a 5/1 ARM will typically have a lower interest rate compared to a 30-year fixed mortgage. Just keep in mind that depending on how much your loan’s rate adjusts, your payment has the potential to increase by a large amount.
Mortgage Rate Trends
To see where mortgage rates are going we rely on information collected by Bankrate, which is owned by the same parent company as NextAdvisor. Looking at historical mortgage rates, we’re seeing low rates like never before. The table below compares today’s average rates to what they were a week ago, and is based on information provided to Bankrate by lenders from across the country:
|Loan type||Interest rate||A week ago||Change|
|30-year fixed rate||3.10%||3.08%||+0.02|
|15-year fixed rate||2.37%||2.37%||N/C|
|30-year jumbo mortgage rate||3.12%||3.10%||+0.02|
|30-year mortgage refinance rate||3.16%||3.13%||+0.03|
Updated on June 4, 2021.
A number of factors can influence mortgage rates, including everything from inflation to unemployment. In general, inflation leads to higher interest rates and vice versa. The dollar loses value with increased inflation, and this causes mortgage-backed securities to become less enticing for investors, which leads to falling prices and higher yields. And if yields increase, interest rates become more expensive for borrowers.
The demand for housing can also impact mortgage rates. If more people are buying homes, there is a greater need for mortgages. This type of demand can drive interest rates up. And if there is less demand for mortgages, that can cause a decline in mortgage rates.
Should I Lock in My Mortgage Rate Now?
It’s impossible to know what direction mortgage rates will go from day to day. That’s why a mortgage rate lock is such a useful tool, because it protects you if rates go up. And with interest rates so low right now, you should lock in your rate as soon as you can.
When you lock in your rate, ask your lender how long the lock will last. A rate lock can be good for anywhere from 30 to 60 days, which typically will give you enough time to close before the lock expires. If something happens where you need to extend your rate lock, ask about fees as many lenders charge a fee for extending a rate lock.
What Is in the Future for Mortgage Rates?
To start the year, mortgage rates jumped and crossed 3% – a level we haven’t seen since July 2020. After this dramatic increase, we saw a decline that brought rates back under 3%. With rates hovering around 3%, they are still near or below the levels many experts expected mortgage rates to be at in 2021.
The direction rates go will depend on the economy. And effectively dealing with the impacts of the coronavirus pandemic should boost our economic recovery. If consumer and government spending increases, that’s likely to drive inflation higher. And higher inflation usually leads to rising mortgage rates. But in spite of the potential for rising inflation, mortgage rates are likely to stay low this year. One reason for this: the Federal Reserve believes low rates will help our economy regain its momentum. So it’s unlikely to make moves that could increase rates.
2021 Mortgage Rate Forecast
In the near term, any changes in mortgage rates should be modest. So rates should hover near 3% for the time being.
However, the economy still has a long way to go before it recovers to pre-pandemic levels. If we get surprised by any bad news, that could put a damper on rates.
How to Qualify for the Lowest Mortgage Rate
Shopping around for a mortgage is one of the best ways to get the lowest mortgage rate.
The mortgage rate you’ll qualify for depends on a number of factors lenders consider when assessing how likely you are to repay your mortgage. Your credit score and debt-to-income ratio (DTI) impact your mortgage rate. And even the property’s value compared to your loan balance is important. So putting more money into your down payment can reduce your mortgage rate.
But lenders will consider your circumstances differently. So you can give the same documentation to three different mortgage providers, and receive mortgage offers with vastly different rates and fees.