A few important mortgage rates dropped today. Average interest rates for the 15-year fixed and 30-year fixed continued to decrease. The average rate of the 5/1 adjustable-rate mortgage also decreased. Mortgage interest rates are always fluctuating, but we’re currently experiencing the lowest rates in years. That’s why now is an ideal time for prospective buyers to lock in a fixed-rate mortgage. Just be sure to review your finances and compare lenders to find the right home loan for you.
Compare nationwide mortgage rates from various lenders
30-year fixed-rate mortgages
The average 30-year fixed mortgage interest rate is 3.08%, which is a decrease of 2 basis points compared to 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 often have a greater interest rate than a 15-year fixed rate mortgage — but also a lower monthly payment. You won’t be able to pay off your house as quickly and you’ll pay more interest over time, but a 30-year fixed mortgage is a good option if you’re looking to minimize your monthly payment.
15-year fixed-rate mortgages
The average rate for a 15-year, fixed mortgage is 2.36%, which is a decrease of 1 basis point from seven days ago. You’ll definitely have a bigger 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. But a 15-year loan will usually be the better deal, as long as you’re able to afford the monthly payments. These include typically 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 3.09%, a fall of 3 basis points from the same time last week. With an adjustable-rate mortgage mortgage, you’ll usually get a lower interest rate than a 30-year fixed mortgage for the first five years. But you may end up paying more after that time, depending on the terms of your loan and how the rate changes with the market rate. Because of this, an ARM may be a good option if you plan to sell or refinance your house before the rate changes. If not, changes in the market might significantly increase your interest rate.
Mortgage rate trends
We use rates collected by Bankrate, which is owned by the same parent company as CNET, to track rate changes over time. This table summarizes the average rates offered by lenders nationwide:
Today’s mortgage interest rates
|Loan term||Today’s rate||Last week||Change|
|30-year mortgage rate||3.08%||3.10%||-0.02|
|15-year fixed rate||2.36%||2.37%||-0.01|
|30-year jumbo mortgage rate||3.24%||3.15%||+0.09|
|30-year mortgage refinance rate||3.14%||3.16%||-0.02|
Rates accurate as of June 10, 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 shopping around for home mortgage rates, think about your goals and current financial situation. Things that affect what mortgage rate you might get include: your credit score, down payment, loan-to-value ratio and your debt-to-income ratio. Generally, you want a higher credit score, a larger down payment, a lower DTI and a lower LTV to get a lower interest rate. Beyond the mortgage rate, additional costs including closing costs, fees, discount points and taxes might also affect the cost of your house. You should speak with multiple lenders — including local and national banks, credit unions and online lenders — and comparison shop to find the best loan for you.
What’s the best loan term?
When picking a mortgage, remember to consider the loan term, or payment schedule. The mortgage terms most commonly offered are 15 years and 30 years, although you can also find 10-, 20- and 40-year mortgages. Another important distinction is between fixed-rate and adjustable-rate mortgages. For fixed-rate mortgages, interest rates are fixed for the life of the loan. For adjustable-rate mortgages, interest rates are the same for a certain number of years (typically five, seven or 10 years), then the rate fluctuates 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 stay in your house. Fixed-rate mortgages might be a better fit for those who plan on staying in a home for quite some time. Fixed-rate mortgages offer more stability over time in comparison to adjustable-rate mortgages, but adjustable-rate mortgages can sometimes offer lower interest rates upfront. If you don’t have plans to keep your new house for more than three to 10 years, however, an adjustable-rate mortgage might give you a better deal. The best loan term is entirely dependent on an individual’s situation and goals, so make sure to think about what’s important to you when choosing a mortgage.