Mortgage interest rates as of September 16, 2021: rates go down

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Some major mortgage rates have fallen today. Both 15-year and 30-year fixed mortgage rates have come down. The average rate for the most common type of variable rate mortgage, the 5/1 variable rate mortgage, also declined. Although mortgage rates fluctuate, they are quite low right now. If you are considering financing a home, this might be a great time to lock in a fixed rate. But as always, be sure to consider your personal goals and circumstances first before buying a home, and look for a lender who can best meet your needs.

Compare national mortgage rates from various lenders

30-year fixed rate mortgages

The 30-year average fixed mortgage interest rate is 3.02%, down 2 basis points from a week 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 generally have a smaller monthly payment than a 15 year mortgage, but often a higher interest rate. You won’t be able to pay off your home that quickly, and you’ll pay more interest over time, but a 30-year fixed mortgage is a good option if you’re looking to keep your monthly payment down.

15-year fixed rate mortgages

The average rate for a 15-year fixed-rate mortgage is 2.31%, down 1 basis point from seven days 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, if you can afford the monthly payments, a 15-year loan has several advantages. You will usually get a lower interest rate and pay less interest overall because you pay off your mortgage much faster.

5/1 adjustable rate mortgages

A 5/1 variable rate mortgage has an average rate of 3.03%, down 2 basis points from last week. You will typically get a lower interest rate (compared to a 30-year fixed mortgage) with an ARM 5/1 during the first five years of the mortgage. However, you could end up paying more after this period, depending on the terms of your loan and how the rate adjusts to the market rate. For this reason, an ARM can be a good option if you plan to sell or refinance your home before the rate changes. Otherwise, changes in the market mean that your interest rate could be much higher after the rate is adjusted.

Mortgage rate trends

We use rates 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 nationwide:

Current average mortgage interest rates

Type of loan Interest rate A week ago Switch
30-year fixed rate 3.02% 3.04% -0.02
15-year fixed rate 2.31% 2.32% -0.01
Giant 30-year mortgage rate 2.79% 2.80% -0.01
30-year mortgage refinancing rate 2.99% 3.01% -0.02

Updated September 16, 2021.

How to shop for the best mortgage rate

To find a personalized mortgage rate, meet with your local mortgage broker or use an online mortgage service. Be sure to take your current financial situation and goals into account when looking for a mortgage. Specific mortgage rates will vary based on factors such as credit rating, down payment, debt-to-income ratio, and loan-to-value ratio. Typically, you want a higher credit score, larger down payment, lower DTI, and lower LTV to get a lower interest rate. Besides the mortgage interest rate, other factors, including closing costs, fees, points of rebate and taxes, can also affect the cost of your home. You should shop around with several lenders – such as credit unions and online lenders in addition to local and state banks – to get a mortgage that’s right for you.

What is the best loan term?

One important thing that you should consider 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 on a fixed rate mortgage are stable throughout the life of the loan. Unlike a fixed rate mortgage, the interest rates for a variable rate mortgage are only the same for a certain period of time (usually five, seven, or 10 years). After that, the rate fluctuates every year based on the current interest rate in the market.

When deciding between a fixed rate mortgage and an adjustable rate mortgage, you need to consider how long you plan to live in your home. Fixed rate mortgages might be better suited if you plan to stay in a house for a while. Fixed rate mortgages offer greater stability over time compared to variable rate mortgages, but variable rate mortgages may offer lower interest rates initially. If you don’t plan on keeping your new home for more than three to ten years, an adjustable rate mortgage might give you a better deal. The best loan term is entirely up to your circumstances and goals, so be sure to consider what’s important to you when choosing a mortgage.

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