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Looking at today’s mortgage rates a number of preeminent rates inched upward. The averages for both 30-year fixed and 15-year fixed mortgages both crept higher. For variable rates, the 5/1 adjustable-rate mortgage (ARM) held steady.
Take a look at today’s rates:
- 30-year fixed mortgage rates are averaging 3.09%
- 15-year fixed mortgage rates are averaging 2.38%
- The average 5/1 adjustable mortgage currently sits at 3.26%
Looking at Today’s Mortgage Refinance Rates
Checking in on refinance rates, the average rates for both 15-year fixed and 30-year fixed refinances remained the same. If you’ve been considering a 10-year refinance loan, just know average rates shrank.
Today’s refinance rates are:
- Today’s average 30-year fixed refinance rate is: 3.14%
- 15-year fixed refinance rate: 2.44%
- 10-year fixed-rate refinance: 2.37%
30-Year Fixed-Rate Mortgages
The median interest rate for a standard, 30-year, fixed mortgage is 3.09%, which is an increase of 1 basis point from the previous week.
You can use NextAdvisor’s home loan payment calculator to work out what your monthly payments would be 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 2.38%, which is an increase of 1 basis point compared to a week ago.
A 15-year, fixed-rate mortgage’s monthly payment is, undeniably, a much bigger monthly payment than what you’d get with a 30-year mortgage offering the same interest rate. 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%, the same rate compared to a week ago.
An adjustable-rate mortgage is ideal for borrowers who will refinance or sell before the rate changes. If that’s not the case, their interest rates could end up being noticeably 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 rate could climb higher and your payment might grow by hundreds of dollars a month.
Recent Mortgage Rate Movement
To see where mortgage rates are headed, 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 the middle of a period of unprecedented low rates. 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 from across the nation:
|Loan term||Today’s Rate||Last week||Change|
|30-year mortgage rate||3.09%||3.08%||+0.01|
|15-year fixed rate||2.38%||2.37%||+0.01|
|30-year jumbo mortgage rate||3.11%||3.08%||+0.03|
|30-year mortgage refinance rate||3.14%||3.14%||N/C|
Rates accurate as of May 4, 2021.
A number of factors can influence mortgage rates, including everything from inflation to unemployment. In general, inflation leads to higher interest rates and vice versa. The dollar loses value with increased inflation, and this causes mortgage-backed securities to become less enticing for investors, which leads to falling prices and higher yields. And if yields increase, interest rates become more expensive for borrowers.
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.
Where Are Mortgage Rates Headed in 2021?
Recently, mortgage rates jumped and crossed 3% for the first time since last summer. Even with this dramatic increase, rates are near or still below the levels many experts expected mortgage rates to be at in 2021.
How we deal with coronavirus, and its impact on the economy, will greatly impact rates. As the economy recovers, we should see inflation rise, which will put upward pressure on mortgage rates. But in spite of the potential for rising inflation, mortgage rates are likely to stay low this year. 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 economy is beginning to show signs of life and investors are expecting increased inflation. This has driven 10-year Treasury bond yields up, which is a key indicator for mortgage rates. But, the Federal Reserve has expressed a desire to keep rates low. Also, some in the industry believe that fears of inflation are somewhat overblown. So don’t expect to see a massive surge in rates this month.
This Week’s Mortgage Predictions
A modest rise is what some experts are forecasting for mortgage rates this week. This would be a bit of a leveling off from previous weeks.
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 Behind 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
- Federal Reserve policy decisions
- Spending in the private and public sectors
- U.S. Treasury bond Yields
- Personal situation: Loan term, type and location of the property, and credit score
How to Get the Lowest Mortgage Rate
Shopping around for a mortgage is one of the best ways to get the lowest rate.
Your mortgage rate depends on a variety of factors lenders consider when assessing how the likelihood that you’ll be able to make your mortgage payments for the long term. Your credit score and debt-to-income ratio (DTI) factor into the decision. And even the property’s value compared to your mortgage balance is important. So putting more money into your down payment can reduce your mortgage rate.
But lenders will look at your situation differently. So you can give the same documentation to three different lenders, and get offers with three different mortgage rates and fees that vary just as much.
What to Know About the Recent Rate Increases
We started off 2021 with mortgage rates dipping to a record low of 2.65%. In the weeks since then, the average 30-year fixed rates have steadily marched all the way up 3.09%. While this rate growth isn’t unexpected, many experts believed it would be later 2021 before we saw rates rise to this level.
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 can change daily.
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