A variety of important mortgage rates saw growth Friday. While 15-year fixed mortgage rates were the same, interest rates on 30-year fixed mortgages inched up. We also saw a rise in the average rate of 5/1 adjustable-rate mortgages. Although mortgage rates are always changing, they are quite low right now. For those looking to get a fixed rate, now is an optimal time to buy a house. Before you buy a home, remember to think about your personal needs and financial situation, and compare offers from different lenders to find the best one for you.
Compare countrywide home loan rates from various lenders
30-year fixed-rate mortgages
The average 30-year fixed mortgage interest rate is 3.10%, which is a growth of 2 basis points compared to one week ago. (A basis point is equivalent to 0.01%.) Thirty-year fixed mortgages are the most frequently used loan term. A 30-year fixed rate mortgage will usually have a lower monthly payment than a 15-year one — but usually a higher interest rate. 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 2.37%, which is the same rate from seven days ago. Compared to a 30-year fixed mortgage, a 15-year fixed mortgage with the same loan value and interest rate will have a higher monthly payment. But a 15-year loan will usually be the better deal, if you’re able to 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 3.12%, an addition of 2 basis points compared to a week ago. For the first five years, you’ll typically get a lower interest rate with a 5/1 adjustable-rate mortgage compared to a 30-year fixed mortgage. But you might end up paying more after that time, depending on the terms of your loan and how the rate shifts with the market rate. If you plan to sell or refinance your house before the rate changes, an ARM could make sense for you. But if that’s not the case, you might be on the hook for a significantly higher interest rate if the market rates shift.
Mortgage rate trends
We use rates 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 across the country:
Current average mortgage interest rates
|Loan type||Interest rate||A week ago||Change|
|30-year fixed rate||3.10%||3.08%||+0.02|
|15-year fixed rate||2.37%||2.37%||N/C|
|30-year jumbo mortgage rate||3.16%||3.14%||+0.02|
|30-year mortgage refinance rate||3.16%||3.13%||+0.03|
Updated on June 4, 2021.
How to find the best mortgage rates
You can get a personalized mortgage rate by reaching out to your local mortgage broker or using an online calculator. In order to find the best home mortgage, you’ll need to consider your goals and overall financial situation. Things that affect what the interest rate you might get on your mortgage 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. The interest rate isn’t the only factor that affects the cost of your home — be sure to also consider other costs such as fees, closing costs, taxes and discount points. Make sure to shop around with multiple lenders — such as credit unions and online lenders in addition to local and national banks — in order to get a mortgage loan that works best for you.
How does the loan term impact my mortgage?
When picking a mortgage, it’s important 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. Mortgages are further divided into fixed- and adjustable-rate mortgages. The interest rates in a fixed-rate mortgage are fixed for the duration of the loan. Unlike a fixed-rate mortgage, the interest rates for an adjustable-rate mortgage are only fixed for a certain amount of time (typically five, seven or 10 years). After that, the rate adjusts annually based on the market rate.
One important factor to consider when choosing between a fixed- and adjustable-rate mortgage is the length of time you plan on living in your home. Fixed-rate mortgages might be a better fit for those who plan on living in a home for quite some time. Fixed-rate mortgages offer greater stability over time in comparison to adjustable-rate mortgages, but adjustable-rate mortgages might offer lower interest rates upfront. You may get a better deal with an adjustable-rate mortgage if you only intend to keep your house for a couple years. There is no best loan term as an overarching 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.