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A variety of notable mortgage rates receded today. The averages for both 30-year fixed and 15-year fixed mortgages diminished. For variable rates, the 5/1 adjustable-rate mortgage (ARM) ticked up.
Mortgage rates currently are:
- The average 30-year fixed-rate mortgage currently sits at 3.08%
- 15-year mortgage rate: 2.35%
- 5/1 ARM rates are averaging 3.24%
Today’s Mortgage Refinance Rates
There’s good news if you’ve been considering a refinance, because the average rates for 15-year fixed and 30-year fixed refinance loans sank. If you’ve been considering a 10-year refinance loan, just know average rates also decreased.
Today’s refinance rates are:
- Today’s average 30-year fixed refinance rate is: 3.12%
- 15-year fixed refinance rates are averaging 2.40%
- 10-year fixed refinance rate: 2.38%
Today’s 30-Year Fixed-Rate Mortgage Rates
The median interest rate for a standard, 30-year, fixed mortgage is 3.08%, which is a decrease of 2 basis points from the previous week.
You can use NextAdvisor’s home 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
Today’s 15-Year Fixed-Rate Mortgage Rates
The median rate for a 15-year fixed mortgage is 2.35%, which is a decrease of 3 basis points from the same time last week.
A 15-year, fixed-rate mortgage’s monthly payment will be much bigger. So finding room in your budget for a 30-year loan’s monthly payment would be easier. But, 15-year loans have some considerable benefits: You’ll save thousands of dollars in interest and pay off your loan much sooner.
Today’s 5/1 Adjustable-Rate Mortgage Rates
A 5/1 ARM has an average rate of 3.24%, which is an uptick of 9 basis points from seven days ago.
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 remarkably 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 your rate could climb higher and your payment might grow by hundreds of dollars a month.
This Week’s Mortgage Rate Trends
To see where mortgage rates are headed, 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 nationwide:
|Loan term||Today’s Rate||Last week||Change|
|30-year mortgage rate||3.08%||3.10%||-0.02|
|15-year fixed rate||2.35%||2.38%||-0.03|
|30-year jumbo mortgage rate||3.08%||3.12%||-0.04|
|30-year mortgage refinance rate||3.12%||3.14%||-0.02|
Rates accurate as of June 8, 2021.
There isn’t a single factor that causes mortgage rates to move, but rather there are many. Chief among them are things including inflation and even the unemployment rate. When you see inflation increasing, that usually means mortgage rates are about to climb higher. On the other hand, lower inflation typically accompanies lower mortgage rates. With higher inflation, the dollar becomes less valuable. This scenario pushes buyers away from mortgage-backed securities, which leads to price decreases and the need for increasing yields. And higher yields require borrowers to pay higher interest rates.
A strong economy has historically increased demand for homes. When more homes are sold, the demand for mortgages also increases, which can cause rates to go up. But the flip side is also true: A drop in demand for mortgages could signal a coming downturn in mortgage rates.
Should I Lock in My Mortgage Rate Now?
Mortgage rates move up and down on a daily basis, and it’s impossible to time the market. So locking in your interest rate right now is a good idea because overall, rates are exceptionally low.
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’s in Store for Mortgage Rates in 2021
To start the year, mortgage rates jumped and crossed 3% for the first time since last summer. 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.
How we have been dealing with coronavirus, and our economic recovery will have a big impact on rates. As the economy recovers, we should see inflation rise, which will push interest rates higher. 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% at the moment.
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 a great way to get the lowest mortgage interest rate.
Your mortgage rate depends on a variety of factors lenders consider when assessing how risky it is to loan you money for a home purchase. Your credit score and debt-to-income ratio (DTI) factor into the decision. And your loan-to-value (LTV) ratio is also important, so having a more substantial down payment is better for your mortgage rate.
But banks will look at your situation differently. So you can provide the same documentation to three different lenders, and find that none of the mortgage rates and fees you are offered are the same.