Here are mortgage rates for Aug. 20, 2021: Rates fall

Here are mortgage rates for Aug. 20, 2021: Rates fall

Here are mortgage rates for Aug. 20, 2021: Rates fall

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A few key mortgage rates receded today. The average rates for the 30-year fixed mortgage decreased, while the 15-year fixed mortgage rates held steady. The average rates for the 5/1 adjustable-rate mortgage also went down. Although mortgage rates always fluctuate, they’re currently at an all time low. That’s why now might be the opportune time to lock in a low fixed rate. As always, be sure to consider your personal finances and goals before buying a home — and be sure to shop around to find the right lender and mortgage for your needs.

Compare nationwide home loan rates from various lenders

30-year fixed-rate mortgages

For a 30-year, fixed-rate mortgage, the average rate you’ll pay is 3.03%, which is a decrease of 1 basis point compared to one week ago. (A basis point is equivalent to 0.01%.) The most frequently used 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 2.32%, which is the same rate from the same time last week. 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 can 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 3.04%, a fall of 2 basis points compared to last week. For the first five years, you’ll typically get a lower interest rate with a 5/1 ARM compared to a 30-year fixed mortgage. However, since the rate adjusts with the market rate, you could end up paying more after that time, as described in the terms of your loan. If you plan to sell or refinance your house before the rate changes, an adjustable-rate mortgage might make sense for you. Otherwise, shifts in the market means your interest rate might be a good deal higher once the rate adjusts.

Mortgage rate trends

We use data collected by Bankrate, which is owned by the same parent company as CNET, to track daily mortgage rate trends. This table summarizes the average rates offered by lenders across the US:

Today’s mortgage interest rates

Loan term Today’s Rate Last week Change
30-year mortgage rate 3.03% 3.04% -0.01
15-year fixed rate 2.32% 2.32% N/C
30-year jumbo mortgage rate 2.80% 2.81% -0.01
30-year mortgage refinance rate 3.02% 3.03% -0.01

Rates accurate as of Aug. 20, 2021.

How to find personalized mortgage rates

When you are ready to apply for a loan, you can connect with a local mortgage broker or search online. When looking into home mortgage rates, think about your goals and current finances. A range of factors — including your down payment, credit score, loan-to-value ratio and debt-to-income ratio — will all affect your mortgage interest rate. Having a higher credit score, a higher down payment, a low DTI, a low LTV, or any combination of those factors can help you get a lower interest rate. Besides the mortgage rate, other costs including closing costs, fees, discount points and taxes might also factor into the cost of your house. Make sure to comparison shop with multiple lenders — such as credit unions and online lenders in addition to local and national banks — in order to get a loan that’s best for you.

Read more: 7 things to do before moving into your new home

How does the loan term impact my mortgage?

When picking a mortgage, remember to consider the loan term, or payment schedule. The loan 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. The interest rates in a fixed-rate mortgage are set for the duration of the loan. For adjustable-rate mortgages, interest rates are the same for a certain number of years (most frequently five, seven or 10 years), then the rate adjusts annually based on the market rate.

When choosing between a fixed-rate and adjustable-rate mortgage, you should think about the length of time you plan to live in your home. Fixed-rate mortgages might be a better fit for those who plan on living in a home for a while. Fixed-rate mortgages offer greater stability over time in comparison to adjustable-rate mortgages, but adjustable-rate mortgages can sometimes offer lower interest rates upfront. If you aren’t planning to keep your new house for more than three to 10 years, however, an adjustable-rate mortgage could give you a better deal. The best loan term all depends on your situation and goals, so be sure to consider what’s important to you when choosing a mortgage.

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