Mortgage rates on Oct. 18, 2021: Rates decreased


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A variety of notable mortgage rates dropped today. The average interest rates for both 15-year fixed and 30-year fixed mortgages fell. At the same time, average rates for 5/1 adjustable-rate mortgages also went down. Although mortgage rates are always moving, they are quite low right currently. That’s why now may be an excellent time for prospective homebuyers to get 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.

30-year fixed-rate mortgages

The 30-year fixed-mortgage rate average is 3.14%, which is a decline of 1 basis point from 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 smaller monthly payment than a 15-year one, but often a higher interest rate. Although you’ll pay more interest over time — you’re paying off your loan over a longer timeframe — 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 mortgage is 2.40%, which is a decrease of 1 basis point compared to a week ago. Compared to a 30-year fixed mortgage, a 15-year fixed mortgage with the same loan value and interest rate will have a larger monthly payment. But a 15-year loan will usually be the better deal, if you’re able to afford the monthly payments. You’ll typically 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 3.14%, a downtick of 2 basis points compared to a week ago. For the first five years, you’ll usually get a lower interest rate with a 5/1 ARM compared to a 30-year fixed mortgage. But 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 adjustable-rate mortgage may make sense for you. But if that’s not the case, you could 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 nationwide:

Current average mortgage interest rates

Loan typeInterest rateA week agoChange
30-year fixed rate3.14%3.15%-0.01
15-year fixed rate2.40%2.41%-0.01
30-year jumbo mortgage rate2.80%2.80%N/C
30-year mortgage refinance rate 3.12%3.13%-0.01

Updated on Oct. 18, 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 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 those factors can help you 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 additional factors such as fees, closing costs, taxes and discount points. Make sure to shop around with multiple lenders — like credit unions and online lenders in addition to local and national banks — in order to get a mortgage loan that works best for you.

What’s the best loan term?

When picking a mortgage, you should 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. Another important distinction is between fixed-rate and adjustable-rate mortgages. The interest rates in a fixed-rate mortgage are set for the duration of the loan. Unlike a fixed-rate mortgage, the interest rates for an adjustable-rate mortgage are only the same for a certain amount of time (usually five, seven or 10 years). After that, the rate fluctuates annually based on the market rate.

When choosing between a fixed-rate and adjustable-rate mortgage, you should think about how long you plan to stay in your house. Fixed-rate mortgages might be a better fit for those who plan on staying in a home for a while. While adjustable-rate mortgages might offer lower interest rates upfront, fixed-rate mortgages are more stable over time. 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. There is no best loan term as a general rule; it all depends on your goals and your current financial situation. Make sure to do your research and think about what’s most important to you when choosing a mortgage.



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