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Some closely followed mortgage rates sank today. Fifteen-year fixed and 30-year fixed mortgage rates both dropped off. The average rate of the most common type of variable-rate mortgage, the 5/1 adjustable-rate mortgage, also saw rates trending downward. Although mortgage rates are dynamic, they are at a historic low. Because of this, right now is a great time for prospective homebuyers to secure a fixed rate. Before you buy a home, remember to think about your personal needs and financial situation, and speak with different lenders to find the right one for you.
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Check out mortgage rates that meet your distinct needs
30-year fixed-rate mortgages
The average interest rate for a standard 30-year fixed mortgage is 3.02%, which is a decline of 3 basis points as seven days ago. (A basis point is equivalent to 0.01%.) Thirty-year fixed mortgages are the most common loan term. A 30-year fixed rate mortgage will usually have a smaller monthly payment than a 15-year one — but often a higher interest rate. 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 2.31%, which is a decrease of 4 basis points compared to a week ago. You’ll definitely have a larger 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, if you can afford the monthly payments. 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 ARM has an average rate of 3.03%, a decrease of 5 basis points compared to a week ago. You’ll usually get a lower interest rate (compared to a 30-year fixed mortgage) with a 5/1 adjustable-rate mortgage in the first five years of the mortgage. But since the rate shifts with the market rate, you might end up paying more after that time, as described in the terms of your loan. For borrowers who plan to sell or refinance their house before the rate changes, an ARM could be a good option. Otherwise, shifts in the market means your interest rate may 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 daily mortgage rate trends. This table summarizes the average rates offered by lenders across the country:
Current average mortgage interest rates
| Loan type | Interest rate | A week ago | Change |
|---|---|---|---|
| 30-year fixed rate | 3.02% | 3.05% | -0.03 |
| 15-year fixed rate | 2.31% | 2.35% | -0.04 |
| 30-year jumbo mortgage rate | 2.80% | 2.80% | N/C |
| 30-year mortgage refinance rate | 3.00% | 3.04% | -0.04 |
Updated on Aug. 19, 2021.
How to find personalized mortgage rates
When you are ready to apply for a loan, you can reach out to a local mortgage broker or search online. Make sure to take into account your current financial situation and your goals when trying to find a mortgage. A range of factors — including your down payment, credit score, loan-to-value ratio and debt-to-income ratio — will all affect your mortgage rate. Having a higher credit score, a larger down payment, a low DTI, a low LTV or any combination of those factors can help you get a lower interest rate. Apart from the interest rate, other costs including closing costs, fees, discount points and taxes might also impact the cost of your house. You should speak with several different lenders — like local and national banks, credit unions and online lenders — and comparison shop to find the best loan for you.
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What is a good loan term?
When picking a mortgage, remember 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- and adjustable-rate mortgages. For fixed-rate mortgages, interest rates are fixed for the life of the loan. Unlike a fixed-rate mortgage, the interest rates for an adjustable-rate mortgage are only stable for a certain amount of time (most frequently five, seven or 10 years). After that, the rate adjusts annually based on the current interest rate in the market.
When choosing between a fixed- and adjustable-rate mortgage, you should take into consideration the length of time you plan to stay in your house. 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 compared to adjustable-rate mortgages, but adjustable-rate mortgages might 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 house for a couple years. The best loan term is entirely dependent on your situation and goals, so be sure to consider what’s important to you when choosing a mortgage.
