Some closely followed mortgage rates decreased today. Fifteen-year fixed and 30-year fixed mortgage rates both sank. For variable rates, the 5/1 adjustable-rate mortgage also sunk lower. Mortgage interest rates are never set in stone, but interest rates are historically low. If you plan to buy a house, now might be a good time to secure a fixed rate. Before you buy a home, remember to take into account your personal needs and financial situation, and speak with various lenders to find the right one for you.
Here are mortgage rates for different types of loan
30-year fixed-rate mortgages
The average 30-year fixed mortgage interest rate is 3.25%, which is a decline of 9 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 rate mortgage will usually have a lower monthly payment than a 15-year one -- but typically 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 2.50%, which is a decrease of 4 basis points from seven days ago. 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. But if you can afford the monthly payments, there are several benefits to a 15-year loan. You'll usually get a lower interest rate, and you'll pay less interest in total because you're paying off your mortgage much quicker.
5/1 adjustable-rate mortgages
A 5/1 ARM has an average rate of 3.26%, a slide of 11 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 ARM in the first five years of the mortgage. However, since the rate adjusts with the market rate, you might 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 ARM may make sense for you. But if that's not the case, you might be on the hook for a much higher interest rate if the market rates shift.
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:
Current average mortgage interest rates
|Loan type||Interest rate||A week ago||Change|
|30-year fixed rate||3.25%||3.34%||-0.09|
|15-year fixed rate||2.50%||2.54%||-0.04|
|30-year jumbo mortgage rate||3.08%||3.10%||-0.02|
|30-year mortgage refinance rate||3.32%||3.41%||-0.09|
Updated on March 31, 2021.
How to find the best mortgage rates
You can get a personalized mortgage rate by connecting with your local mortgage broker or using an online calculator. Make sure to consider your current finances and your goals when searching for a mortgage. A range of factors -- including your down payment, credit score, loan-to-value ratio and debt-to-income ratio -- will all affect the interest rate on your mortgage. 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 interest rate, other costs including closing costs, fees, discount points and taxes might also affect the cost of your house. Make sure to comparison shop with multiple lenders -- including credit unions and online lenders in addition to local and national banks -- in order to get a loan that's right for you.
What's the best loan term?
When picking a mortgage, it's important 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. Mortgages are further divided into fixed-rate 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 fixed for a certain amount of time (most frequently five, seven or 10 years). After that, the rate changes annually based on the current interest rate in the market.
When choosing between a fixed-rate and adjustable-rate mortgage, you should consider how long you plan to stay in your home. Fixed-rate mortgages might be a better fit for people who plan on living in your new home for a while. While adjustable-rate mortgages may offer lower interest rates upfront, fixed-rate mortgages are more stable in the long term. If you don't have plans to keep your new home for more than three to 10 years, however, an adjustable-rate mortgage might give you a better deal. The "best" loan term all depends on your personal situation and goals, so be sure to think about what's important to you when choosing a mortgage.