A couple of principal mortgage rates fell today. Average 15-year fixed mortgage rates stayed the same, while average 30-year fixed mortgage rates declined. The average rate of the most common type of variable-rate mortgage, the 5/1 adjustable-rate mortgage, saw rates trending downward. Although mortgage rates fluctuate, they are lower than they’ve been in years. If you plan to buy a house, now might be an optimal time to get a fixed rate. But as always, make sure to first think about your personal goals and circumstances before purchasing a house, and compare offers to find a lender who can best meet your needs.
Take a look at mortgage rates for different styles of loan
30-year fixed-rate mortgages
The 30-year fixed-mortgage rate average is 3.08%, which is a decrease of 1 basis point from one week ago. (A basis point is equivalent to 0.01%.) The most common loan term is a 30-year fixed mortgage. A 30-year fixed mortgage will usually have a higher interest rate than a 15-year fixed rate mortgage — but also a lower monthly payment. Although you’ll pay more interest over time — you’re paying off your loan over a longer timeframe — if you’re looking for a lower monthly payment, a 30-year fixed mortgage may be a good option.
15-year fixed-rate mortgages
The average rate for a 15-year, fixed mortgage is 2.37%, which is the same rate from the same time last week. You’ll definitely have a higher monthly payment with a 15-year fixed mortgage compared to a 30-year fixed mortgage, even if the interest rate and loan amount are the same. However, if you can afford the monthly payments, there are several benefits to a 15-year loan. These include usually being able to get a lower interest rate, paying off your mortgage sooner, and paying less total interest in the long run.
5/1 adjustable-rate mortgages
A 5/1 adjustable-rate mortgage has an average rate of 3.10%, a decrease of 1 basis point from the same time last week. For the first five years, you’ll usually get a lower interest rate with a 5/1 adjustable-rate mortgage compared to a 30-year fixed mortgage. However, changes in the market might cause your interest rate to increase after that time, as detailed in the terms of your loan. Because of this, an adjustable-rate mortgage could be a good option if you plan to sell or refinance your house before the rate changes. Otherwise, shifts in the market means your interest rate might be significantly higher once the rate adjusts.
Mortgage rate trends
We use information collected by Bankrate, which is owned by the same parent company as CNET, to track changes in these daily rates. This table summarizes the average rates offered by lenders nationwide:
Current average mortgage interest rates
|Loan type||Interest rate||A week ago||Change|
|30-year fixed rate||3.08%||3.09%||-0.01|
|15-year fixed rate||2.37%||2.37%||N/C|
|30-year jumbo mortgage rate||3.14%||3.16%||-0.02|
|30-year mortgage refinance rate||3.13%||3.15%||-0.02|
Updated on May 28, 2021.
How to shop for the best mortgage rate
To find a personalized mortgage rate, talk to your local mortgage broker or use an online mortgage service. When researching home mortgage rates, consider your goals and current financial situation. Specific interest rates will vary based on factors including credit score, down payment, debt-to-income ratio and loan-to-value ratio. Generally, you want a good credit score, a higher down payment, a lower DTI and a lower LTV to get a lower interest rate. The interest rate isn’t the only factor that affects the cost of your home — be sure to also consider other factors such as fees, closing costs, taxes and discount points. You should talk to multiple lenders — for example, local and national banks, credit unions and online lenders — and comparison shop to find the best mortgage for you.
What is a good loan term?
When picking a mortgage, it’s important to consider the loan term, or payment schedule. The most common loan terms are 15 years and 30 years, although 10-, 20- and 40-year mortgages also exist. Mortgages are further divided into fixed-rate and adjustable-rate mortgages. For fixed-rate mortgages, interest rates are the same for the life of the loan. Unlike a fixed-rate mortgage, the interest rates for an adjustable-rate mortgage are only set for a certain amount of time (commonly five, seven or 10 years). After that, the rate adjusts annually based on the current interest rate in the market.
When deciding between a fixed-rate and adjustable-rate mortgage, you should think about how long you plan to live in your home. Fixed-rate mortgages might be a better fit if you plan on staying in a home for a while. Fixed-rate mortgages offer greater stability over time in comparison to adjustable-rate mortgages, but adjustable-rate mortgages may offer lower interest rates upfront. However you may get a better deal with an adjustable-rate mortgage if you’re only planning to keep your home for a couple years. There is no best loan term as a general rule; it all depends on your goals and your current financial situation. Be sure to do your research and think about your own priorities when choosing a mortgage.