Today’s Mortgage and Refinance Rates, September 13, 2021 | Rates Cool Off

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What we’re seeing today is a number of principal mortgage rates have shrank. Both 30-year fixed and 15-year fixed mortgage rates dropped off. The most common type of variable-rate mortgage is the 5/1 adjustable-rate mortgage (ARM) which also were down.

The average mortgage rates are as follows:

What this means for borrowers:
Qualified borrowers continue to have access to reduced mortgage rates. But for many buyers, getting a good rate isn’t making it any easier to find a home. There aren’t many homes for sale, so competition has caused home prices to rise. So if you’re shopping for a home, be prepared to move quickly as the few homes on the market are moving fast.

Looking at 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. Shorter term, 10-year fixed-rate refinance mortgages saw growth.

The refinance averages for 30-year, 15-year, and 10-year loans are:

Current Mortgage Rates.

30-Year Fixed Mortgage Rates

The median interest rate for a standard, 30-year, fixed mortgage is 3.01%, which is a decrease of 3 basis points from seven days ago.

You can use NextAdvisor’s mortgage calculator to work out what your monthly payments would be and play around with extra mortgage payments to wrap your head around how much you could save. The mortgage calculator can also show you all of the interest you’ll pay over the life of the loan.

15-Year Mortgage Rates

The median rate for a 15-year fixed mortgage is 2.31%, which is a decrease of 3 basis points compared to a week ago.

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.

5/1 ARM Mortgage Rates

A 5/1 ARM has an average rate of 2.78%, a slide of 2 basis points compared to a week ago.

An adjustable-rate mortgage is ideal for borrowers who will sell or refinance 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. Keep in mind that your payment could end up being hundreds of dollars higher after a rate adjustment, depending on the terms of your loan.

Mortgage Interest Rate Movement

The mortgage rate you qualify for is partially dependent on personal factors, such as your credit score or the size of your down payment. But general rate trends involve a number of things that are out of your control. The Federal Reserve Bank’s policies, demand for mortgages, and the health of the economy all factor into mortgage rate trends

The Federal Reserve Bank can also influence rates, although it doesn’t directly set mortgage interest rates. Currently, the Federal Reserve is purchasing billions of dollars in mortgage-backed securities (MBS) each month. This increased demand for MBS has helped to keep rates from increasing. However, as the economy recovers the Federal Reserve could announce plans to reduce the amount of securities it purchases, which would allow rates to rise.

How we determine mortgage rates

To get an idea of where mortgage rate may move, we rely on information collected by Bankrate, which is owned by the same parent company as NextAdvisor. The daily rates survey focuses on mortgages where the borrower has a 740+ credit score, 20% equity or more, and the home is occupied by the owner.

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:

Today’s mortgage interest rates
Loan termToday’s RateLast weekChange
30-year mortgage rate3.01%3.04%-0.03
15-year fixed rate2.31%2.34%-0.03
30-year jumbo mortgage rate3.02%3.06%-0.04
30-year mortgage refinance rate2.99%3.01%-0.02

Rates accurate as of September 13, 2021.

Is It a Good Idea to Lock in My Mortgage Rate Right 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 you want to extend the rate lock, ask about fees as many lenders charge a fee for extending a rate lock.

What Is in the Future for Mortgage Rates?

This summer, mortgage rates have been extremely favorable for borrowers and have rarely topped 3%. Inflation and the economy both are looking stronger, which normally would push rates up. But the uncertainty surrounding the Delta variant has acted as a counterbalance. However, by the end of 2021 some experts see mortgage rates rising slightly.

The direction rates go will depend on the economy. A growing economy usually goes hand in hand with rising mortgage rates. If consumer and government spending increases, that’s likely to drive inflation higher. However, the Federal Reserve believes the inflation we’re seeing is only temporary, and so rates have stayed low. But in spite of the potential for rising inflation, it’s unlikely that we’ll see skyrocketing mortgage rates in 2021. One reason for this: the Federal Reserve believes that low interest rates will help the economy rebound. So it’s likely to make policy decisions in favor of keeping rates low.

Where Are Mortgage Rates Headed in 2021?

In the coming weeks, we shouldn’t see any drastic changes in mortgage rates. That means we’re likely to see rates stay near or below 3%.

The uncertainty surrounding COVID variants has put a damper on rates. But if the Federal Reserve is confident enough in the U.S. economy, if could change course and ease its policies that have kept rates low.

How to Qualify for the Lowest Mortgage Rate

There are two key considerations to getting the lowest interest rate: Loan-to-value ratio (LTV), and your credit score.

These days, a credit score of at least 750 will help you get the best rate. However, even a score 700 or higher can get you a decent rate reduction compared to a lower credit score. However, once you get a credit score higher than 800, the interest rate discount is negligible.

Banks give the most substantial mortgage rate reductions to borrowers that are deemed less risky. One surefire way to show you’re a less risky borrower is to have a bigger down payment. A down payment of 20% or more will save you money in two ways: with a more favorable mortgage rate, and you’ll be able to avoid paying for private mortgage insurance (PMI).