Today, several key mortgage rates have fallen. Average interest rates for fixed-term mortgages of 15 and 30 years both fell, while 5/1 floating-rate mortgages also fell. Mortgage rates always fluctuate, but rates are currently at an all-time low. If you’re looking for a low fixed rate, now might be a good time to take out a mortgage. As always, be sure to review your financial circumstances and compare different lenders before choosing a home loan.
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View mortgage rates that meet your specific needs
30-Year Fixed Rate Mortgages
For a 30-year fixed-rate mortgage, the average interest rate you pay is 2.96%, down 6 basis points from seven days ago. (A basis point equals 0.01%.) The most commonly used loan term is a 30-year fixed mortgage. A 30-year fixed-rate mortgage usually has a smaller monthly payment than a 15-year mortgage, but often a higher interest rate. While you’ll pay more interest over time — you’ll pay off your loan over a longer period of time — if you’re looking for a lower monthly payment, a 30-year fixed mortgage may be a good option.
Mortgages with a fixed interest rate of 15 years
The average rate for a 15-year, fixed mortgage is 2.26%, down 4 basis points from the same time last week. With a mortgage with a term of 15 years you certainly have a higher monthly amount than with a mortgage with a term of 30 years, even if the interest and the loan amount are the same. However, if you can afford the monthly payments, there are several advantages to a 15-year loan. You will probably get a lower interest rate and in total you will pay less interest because you pay off the mortgage much faster.
5/1 floating rate mortgages
A 5/1 floating rate mortgage has an average interest rate of 2.97%, down 7 basis points from last week. With an ARM mortgage, you usually get a lower interest rate for the first five years than a 30-year fixed mortgage. However, you may pay more after that time, depending on the terms of your loan and how the interest rate adjusts to the market rate. Therefore, an ARM can be a good option if you plan to sell or refinance a home before interest rates change. If not, shifts in the market can raise your interest rates significantly.
Mortgage Interest Trends
We use data collected by Bankrate, which is owned by the same parent company as CNET, to track changes in these daily rates. This table lists the average rates offered by lenders across the country:
Today’s mortgage rate
|loan term||Today’s rate||Last week||Change|
|30 year mortgage interest||2.96%||3.02%||-0.06|
|15 years fixed rate||2.26%||2.30%||-0.04|
|30-year jumbo mortgage rate||2.79%||2.78%||+0.01|
|Mortgage interest over 30 years||2.94%||3.00%||-0.06|
Rates correct from August 5, 2021.
This is how you find the best mortgage interest
Contact your local mortgage broker or use an online mortgage service to find a personalized mortgage rate. When looking for a mortgage, think carefully about your current finances and goals. A range of factors — including your down payment, credit score, loan-to-value ratio, and debt-to-income ratio — all affect your mortgage interest rate. In general, you want a good credit score, a higher down payment, a lower DTI and a lower LTV to get a low interest rate.
In addition to interest, factors such as closing costs, fees, discount points and taxes can also affect the cost of your home. Be sure to talk to different lenders – such as local and national banks, credit unions and online lenders – and compare shop to find the best loan for you.
What is a good loan term?
An important factor to consider when choosing a mortgage is the loan term or payment schedule. The most common loan terms are 15 years and 30 years, although there are also 10, 20 and 40 year mortgages. Another important distinction is between fixed and floating rate mortgages. For fixed-rate mortgages, the interest rate is fixed for the life of the loan. Unlike a fixed-rate mortgage, the interest rates for a variable-rate mortgage are only the same for a set amount of time (usually five, seven, or ten years). After that, the rate changes annually based on the market.
When choosing between a fixed and variable rate mortgage, consider how long you plan to live in your home. Fixed rate mortgages may be better suited if you plan on staying in a home for a while. Fixed-rate mortgages offer more stability over time compared to adjustable-rate mortgages, but adjustable-rate mortgages can offer lower interest rates up front. However, you can get a better deal with a variable rate mortgage if you only plan to keep your home for a few years. There is no best loan term as a general rule: it all depends on your goals and current financial situation. It’s important to do your research and think about your own priorities when choosing a mortgage.