Mortgage interest rates as of October 20, 2021: Rates slide

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Average rates for 30-year fixed and 5/1 variable-rate mortgages declined today, while 15-year fixed mortgage rates edged up. Although mortgage rates fluctuate, interest rates are still at an all time low. If you are shopping for a home, maybe now is a great time to get a low fixed rate. Just be sure to consider your personal finances and goals before buying a home, and always compare mortgage options from different lenders.

30-year fixed rate mortgages

For a 30-year fixed rate mortgage, the average rate you’ll pay is 3.18%, down 1 basis point from seven days ago. (One basis point equals 0.01%.) Thirty-year fixed rate mortgages are the most common loan term. A 30 year fixed rate mortgage will often have a higher interest rate than a 15 year fixed rate mortgage, but also a lower monthly payment. While you will pay more interest over time – you pay off your loan over a longer period – 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-rate mortgage is 2.46%, which is an increase of 3 basis points from a week ago. Compared to a 30-year fixed mortgage, a 15-year fixed mortgage with the same loan value and the same interest rate will have a higher monthly payment. However, as long as you can afford the monthly payments, a 15-year loan has several advantages. These typically include the ability to get a lower interest rate, pay off your mortgage sooner, and pay less total interest over the long term.

5/1 adjustable rate mortgages

A 5/1 ARM has an average rate of 3.18%, a decrease of 3 basis points from a week ago. For the first five years, you will typically get a lower interest rate with an ARM 5/1 compared to a 30-year fixed mortgage. However, since the rate adjusts to the market rate, you could end up paying more after this period, as described in your loan terms. For borrowers who plan to sell or refinance their home before rates change, an ARM may be a good option. But if it doesn’t, you might be forced to pay a much higher interest rate if market rates change.

Mortgage rate trends

We use data collected by Bankrate, which is owned by the same parent company as CNET, to track rate changes over time. This table summarizes the average rates offered by lenders across the country:

Average mortgage interest rates

Product Rate Last week Switch
30 years fixed 3.18% 3.19% -0.01
15 years fixed 2.46% 2.43% +0.03
Giant 30-year mortgage rate 2.81% 2.79% +0.02
30-year mortgage refinancing rate 3.16% 3.17% -0.01

Prices as of October 20, 2021.

How to shop for the best mortgage rate

You can get a personalized mortgage rate by contacting your local mortgage broker or by using an online calculator. Be sure to take your current finances and goals into account when looking 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 your mortgage rate. Having a higher credit score, a larger down payment, a low DTI, a low LTV, or any combination of these factors can help you get a lower interest rate. The interest rate is not the only factor that affects the cost of your home. Also, be sure to consider other factors like fees, closing costs, taxes, and points of call. Be sure to talk to multiple lenders, such as local and state banks, credit unions, and online lenders, and do a comparator to find the best mortgage for you.

How does the term of the loan affect my mortgage?

An important consideration when choosing a mortgage loan is the length of the loan or the payment schedule. The most common loan terms are 15 years and 30 years, although there are also 10, 20 and 40 year mortgages. The mortgages are then divided into fixed rate and adjustable rate mortgages. The interest rates for a fixed rate mortgage are the same throughout the life of the loan. For variable rate mortgages, interest rates are set for a number of years (typically five, seven, or 10 years) and then the rate adjusts annually based on the current market interest rate.

When choosing between a fixed rate mortgage and an adjustable rate mortgage, you need to consider how long you plan to live in your home. For those who plan to stay in a new home for the long term, fixed rate mortgages may be the best option. While variable rate mortgages may have lower interest rates initially, fixed rate mortgages are more stable over the long term. However, you might get a better deal with an adjustable rate mortgage if you plan to only keep your home for a few years. Generally, there is no better loan term; it all depends on your goals and your current financial situation. It’s important to do your research and think about what is most important to you when choosing a mortgage.


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