Here Are Today’s Mortgage Rates, September 22, 2022 | Rates Top 6.4% After Fed Meeting

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Nearly two years have gone by with record-low mortgage rates. Now, 2022 has started off with rates rising higher than pre-pandemic levels.

Don’t cancel your home purchase plans just yet. Even though rates are higher than they were last year they are still considered “normal” from a historical perspective. It was only a few short years ago where the 30-year fixed rates were in the high 5%’s.

Homebuying decisions take a lot more consideration outside of the interest rate anyway. Buying a home is about making a lifestyle choice. What’s going on in the interest rate market can influence a decision, it’s wise to not base it solely on a few basis points on a mortgage rate. Setting and sticking to a realistic homebuying budget is way more important than what rate you get.

Let’s take a look at current mortgage rates, where rates have been in the past, and what it all means for the borrower.

A number of principal mortgage rates all crept upward today. Both 30-year fixed and 15-year fixed mortgage rates climbed higher. We also saw an upswing in the average rate of 5/1 adjustable-rate mortgages (ARM).

The averages for 30-year fixed, 15-year fixed, and 5/1 ARMs are:

Mortgage Rate Trends: What’s Behind the Recent Rate Movement?

The surge in mortgage rates so far this year is due to a variety of economic factors. Persistently high inflation is a big one, Jacob Channel, senior economic analyst at LendingTree told us. July’s inflation report shows 8.5%inflation year-over-year. That’s lower than June’s 9.1%, a sign that inflation is starting to cool.

Though still high, in response, the Federal Reserve increased its benchmark short-term interest rate to combat that inflation. The Fed raised rates by 50 basis points in May, 75 points in June, and by 75 basis points in July.

Recently, we saw mortgage rates surge after the inflation report and ahead of the Fed’s announcement. “I think what we’re seeing is that lenders had already anticipated that the Fed was going to raise the fed funds rate by 75 basis points and they began to preemptively push mortgage rates up,” Jacob Channel, senior economist at LendingTree, told us.

Energy prices are half responsible for these increases, Dawit Kebede, senior economist for the Credit Union National Association, said in a statement. “There are signs that some of the main drivers of inflation are easing, such as lower oil and other commodity prices in July, slower wage growth, and declining supply chain pressures. However, service price increases led by housing and pent-up demand for vehicles will keep inflation elevated in the coming months.”

Current Mortgage Rates: Are They Good For Buying a Home Right Now?

2022 started off with dramatic rate increases. But from a historical perspective, mortgage rates remain at comparatively normal levels.

With a combination of limited supply of homes and strong demand, home prices are up significantly from before the pandemic. The higher costs to build homes and the massive demand from buyers is also contributing to the surge. This, plus higher mortgage rates, makes the overall cost of homeownership more expensive for the borrower.

The difference of a half a point or so can equal a lot of money over a 30-year mortgage. But it’s best not to try to time the market to get the best mortgage rate. Experts say, instead, to focus on finding the right house, and make moves when your personal lifestyle and financial situation indicate it’s the right time.

Rates between mortgage lenders can vary significantly. Make sure to shop around between a few different mortgage lenders to ensure you’re getting the best current deal. “The rate highly impacts your monthly affordability for as long as you will hold this home,” Skylar Olsen, principal economist at Tomo, a digital real estate and mortgage company, told us. “It is actually a critical piece of this decision, and that takes shopping around.”

Closing Costs & Loan Fees

If you take out a home loan, you’ll want to be aware of the closing costs. Closing costs can be anywhere between 3-6% of the loan amount, and include fees such as loan origination charges, prepaid interest and property taxes. Accepting a higher interest rate, in exchange for lender credits can assist you in reducing your out-of-pocket costs. There is a possibility that you will be selling your home or refinancing in five to eight years, so this strategy could save you money in the short-term.

Looking at Today’s Mortgage Refinance Rates

Refinancing became a bit more expensive today as 30-year fixed and 15-year fixed refinance mortgages saw their average rates climb. Shorter term, 10-year fixed-rate refinance mortgages also saw an increase.

Take a look at today’s refinance rates:

Here are mortgage rates for different styles of loan.

30-Year Fixed-Rate Mortgage Rates

The median interest rate for a standard, 30-year, fixed mortgage is 6.43%, which is an increase of 24 basis points from last week.

15-Year Mortgage Rates

The median rate for a 15-year fixed mortgage is 5.66%, which is an increase of 15 basis points from seven days ago.

A 15-year, fixed-rate mortgage’s monthly payment is larger than what you would pay with a 30-year mortgage. But, 15-year loans have some considerable benefits: You’ll pay thousands less in interest and pay off your loan much faster.

5/1 ARM Rates

A 5/1 ARM has an average rate of 4.84%, which is an uptick of 21 basis points compared to last week.

An ARM is ideal for borrowers 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. Keep in mind that depending on how much your loan’s rate adjusts, your payment has the potential to increase by a large amount.

How We Determine Mortgage Interest Rates

To see where mortgage rates are moving, we rely on information collected by Bankrate, which is owned by the same parent company as NextAdvisor. The daily rates survey focuses on home loans where the borrower has a high credit score (740+), a LTV of 80% or lower, and lives in the home.

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:

Average mortgage interest rates
ProductRateLast weekChange
30-year fixed6.43%6.19%+0.24
15-year fixed5.66%5.51%+0.15
30-year jumbo mortgage rate6.42%6.18%+0.24
30-year mortgage refinance rate6.42%6.19%+0.23

Rates as of September 22, 2022.

Pro Tip

Plug and play your desired interest rate and the rest of your loan details into our mortgage calculator to see what your monthly payment may look like.

Mortgage Rate Frequently Asked Questions (FAQ):

How Do I Qualify for the Lowest Mortgage Rate?

As you work to secure the absolute lowest mortgage interest rate you should focus on two main factors: Credit score, and loan-to-value ratio (LTV)..

To get the lowest interest rate, you’ll need a credit score somewhere between 700-800. Having a credit score above 800 is nice, but will likely have a minimal impact on your rate.

Banks provide the most substantial mortgage rate discounts to home buyers that are deemed less risky. One surefire way to signal you’re more likely to make your monthly payments is to bring a bigger down payment to the closing table. 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).

Is Now a Good Time to Lock in My Mortgage Rate?

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 historically favorable.

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.