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A number of important mortgage rates all crept higher today. Both 30-year fixed and 15-year fixed mortgage rates inched upward. We also saw a rise in the average rate of 5/1 adjustable-rate mortgages (ARM).
The average mortgage rates are as follows:
Today’s Mortgage Refinance Rates
Refinancing became a bit more expensive today as 30-year fixed and 15-year fixed refinance mortgages saw their mean rates go higher. Shorter term, 10-year fixed-rate refinance mortgages also inched up.
The refinance averages for 30-year, 15-year, and 10-year loans are:
- 30-year fixed refinance rates are averaging: 3.16%
- 15-year refinance rate: 2.47%
- 10-year refinance rate: 2.44%
30-Year Fixed-Rate Mortgages
The average 30-year fixed mortgage interest rate is 3.11%, which is a growth of 3 basis points from seven days ago.
You can use NextAdvisor’s mortgage payment calculator to determine your monthly payments and understand how adding extra payments will impact your loan. The mortgage calculator can also show you the total interest you’ll pay over the life of the loan
15-Year Fixed-Rate Mortgages
The median rate for a 15-year fixed mortgage is 2.40%, which is an increase of 2 basis points from the same time last week.
A 15-year, fixed-rate mortgage’s monthly payment is larger than what you would pay with a 30-year mortgage. However, 15-year loans have some considerable benefits: You’ll save thousands of dollars in interest and pay off your loan much faster.
5/1 Adjustable-Rate Mortgages
A 5/1 ARM has an average rate of 3.26%, which is an uptick of 2 basis points from seven days ago.
An adjustable-rate mortgage is ideal for borrowers who will sell or refinance before the rate changes. If that’s not the case, their interest rates could end up being remarkably higher after a rate adjusts.
For the first five years, a 5/1 ARM will typically have a lower interest rate compared to a 30-year fixed mortgage. Just keep in mind that your payment could end up being hundreds of dollars higher after a rate adjustment, depending on the terms of your loan.
Recent Mortgage Rate Movement
To see where mortgage rates are going we rely on information collected by Bankrate, which is owned by the same parent company as NextAdvisor. Looking at the history of mortgage rates, we’re in an exceptionally low rate environment. The table below compares today’s average rates to what they were a week ago, and is based on information provided to Bankrate by lenders nationwide:
|Loan type||Interest rate||A week ago||Change|
|30-year fixed rate||3.11%||3.08%||+0.03|
|15-year fixed rate||2.40%||2.38%||+0.02|
|30-year jumbo mortgage rate||3.12%||3.07%||+0.05|
|30-year mortgage refinance rate||3.16%||3.14%||+0.02|
Updated on April 29, 2021.
There isn’t a single factor that causes mortgage rates to move, but rather there are many. Chief among them are things including inflation and even the unemployment rate. When you see inflation increasing, that usually means mortgage rates are about to climb higher. On the other hand, lower inflation typically accompanies lower mortgage rates. With higher inflation, the dollar becomes less valuable. This scenario pushes buyers away from mortgage-backed securities, which leads to price decreases and the need for increasing yields. And higher yields require borrowers to pay higher interest rates.
The demand for housing can also impact mortgage rates. If more people are buying homes, there is a greater need for mortgages. This type of demand can drive interest rates up. And if there is less demand for mortgages, that can cause a decline in mortgage rates.
What Is in the Future for Mortgage Rates?
Recently, mortgage rates jumped and crossed 3% – a level we haven’t seen since July 2020. Even with this dramatic increase, rates are near or still below the levels many experts predicted they would hit in 2021.
The direction rates go will depend on the economy. And effectively dealing with the impacts of the coronavirus pandemic should boost our economic recovery. If consumer and government spending increases, that’s likely to drive inflation higher. And higher inflation usually leads to rising mortgage rates. But in spite of the potential for rising inflation, it’s unlikely that we’ll see skyrocketing mortgage rates in 2021. One reason for this: the Federal Reserve believes that low interest rates will help the economy rebound. So it’s unlikely to make moves that could increase rates.
This Month’s Mortgage Predictions
Following the recent flurry of activity with mortgage rates, many experts are predicting mortgage rates will be calmer this month.
The Federal Reserve would still like to keep rates low to boost the economy. And some experts believe the fears of inflation that have been driving rates higher are a bit overblown. So even though mortgage interest rates are likely to continue to rise over the long term, a massive spike isn’t likely.
This Week’s Mortgage Predictions
The current rise in mortgage rates is what we’d expect to see with the economy looking like it’s starting to recover. So this week’s mortgage rates forecast is for more of the same, but with only a potential for a moderate uptick.
However, the economy still has a long way to go before it recovers to pre-pandemic levels. If we get surprised by any bad news, that could put a damper on rates.
Factors Influencing Today’s Mortgage Rates
There is a wide range of factors that affect mortgage rates. Some are broader economic factors, and others are related to your individual circumstances.
- Condition of the economy
- Decisions made by the Federal Reserve
- Spending in the private and public sectors
- Yields for 10-year Treasury bonds
- Rate of inflation
- Personal situation: Loan term, type and location of the property, and credit score
How to Qualify for the Lowest Mortgage Rate
To get the the absolute lowest interest rate you should focus on three factors: Credit score, loan-to-value ratio (LTV), and debt-to-income ratio (DTI).
To get the lowest rate, you’ll need a credit score between 700 to 800. Having a credit score above 800 is nice, but will likely have a minimal impact on your rate.
Having fewer debt payments can make it cheaper for you to purchase a home. Your DTI will drop when you have fewer monthly debt obligations. Having a lower DTI can end up reducing your interest rate.
Mortgage providers offer the most substantial mortgage rate discounts to borrowers that are seen as less risky. A large down payment is a signal to lenders that you have more skin in the game and are less likely to default on your loan. A down payment of 20% or more will save you money in two ways: with a more favorable mortgage rate, and you’ll be able to avoid paying for private mortgage insurance (PMI).
How Rising Mortgage Rates Impact Home Buying
Over the past few months, mortgage rates have surged. Since we hit an all-time low average of 2.65% for 30-year fixed mortgages, we’ve seen rates increaseto 3.09%.
The recent 0.44% increase in mortgage rates will affect your bottom line. The monthly payment on a $300,000 30-year mortgage is now $71 a month at the current interest rates. However, even though buyers will have to adjust their homebuying budgets, don’t expect it to turn into a buyer’s market anytime soon.
There is still a severe shortage of homes for sale. So as we enter peak buying season, expect to continue seeing homes sell quickly for above the asking price. Those trends can make it can be a frustrating market for buyers.
How We Got These Rates
The rates we have included are averages provided by Bankrate.com Site Averages and are calculated after the close of the previous business day. The lenders that the “Bankrate.com Site Average” tables include are not the same every day.
National lenders provide this mortgage rate information to Bankrate.com. It is possible the mortgage rates we reference has changed since this was published.
Mortgage Interest Rates by Loan Type
Home Purchase Rates
- 30 Year Fixed Mortgage Rates
- 20 Year Fixed Mortgage Rates
- 15 Year Fixed Mortgage Rates
- 10 Year Fixed Mortgage Rates
- VA Mortgage Rates