A few notable mortgage rates saw growth today. The average interest rates for both 15-year fixed and 30-year fixed mortgages both climbed higher. At the same time, average rates for 5/1 adjustable-rate mortgages declined.
Mortgage rates have been rather consistently going up since the start of this year, and are expected to climb throughout 2022. Of course, interest rates are dynamic and unpredictable — at least on a daily or weekly basis — as they respond to a wide variety of economic factors. At the moment, inflation and the federal funds rate are particularly influential. The Federal Reserve has increased interest rates three times this year and has signaled its intention to hike rates again to try to contain inflation. That will likely translate into higher mortgage rates and, for prospective borrowers, steeper monthly mortgage payments. As such, homebuyers may have better luck locking in a lower mortgage interest rate sooner than later. It’s always a good idea to interview multiple lenders to compare rates and fees to find the best mortgage for your specific situation.
30-year fixed-rate mortgages
The average 30-year fixed mortgage interest rate is 5.73%, which is a growth of 6 basis points as of seven days ago. (A basis point is equivalent to 0.01%.) The most common loan term is a 30-year fixed mortgage. A 30-year fixed rate mortgage will usually have a smaller monthly payment than a 15-year one — but usually a higher interest rate. You won’t be able to pay off your house as quickly and you’ll pay more interest over time, but a 30-year fixed mortgage is a good option if you’re looking to minimize your monthly payment.
15-year fixed-rate mortgages
The average rate for a 15-year, fixed mortgage is 4.89%, which is an increase of 2 basis points compared to a week ago. You’ll definitely have a larger monthly payment with a 15-year fixed mortgage compared to a 30-year fixed mortgage, even if the interest rate and loan amount are the same. But a 15-year loan will usually be the better deal, if you can afford the monthly payments. These typically include being able to get a lower interest rate, paying off your mortgage sooner, and paying less total interest in the long run.
5/1 adjustable-rate mortgages
A 5/1 ARM has an average rate of 4.21%, a downtick of 6 basis points compared to a week ago. For the first five years, you’ll typically get a lower interest rate with a 5/1 ARM compared to a 30-year fixed mortgage. However, shifts in the market could cause your interest rate to increase after that time, as detailed in the terms of your loan. If you plan to sell or refinance your house before the rate changes, an adjustable-rate mortgage could make sense for you. Otherwise, changes in the market means your interest rate may be a good deal higher once the rate adjusts.
Mortgage rate trends
Although mortgage rates were historically low at the beginning of 2022, they have been rising somewhat steadily since then. The Federal Reserve recently raised interest rates by 0.75 percentage points — the highest rate increase since 1994 — in an attempt to curb record-high inflation. As a general rule, when inflation is low, mortgage rates tend to be lower. When inflation is high, rates tend to be higher.
Although the Fed does not directly set mortgage rates, the central bank’s policy actions influence how much you pay to finance your home loan. And the Fed has signaled that it will continue to raise rates over the course of this year. So, if you’re looking to buy a house in 2022, expect mortgage rates to generally increase as the year goes on.
We use information 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:
Current average mortgage interest rates
| Loan type | Interest rate | A week ago | Change |
|---|---|---|---|
| 30-year fixed rate | 5.73% | 5.67% | +0.06 |
| 15-year fixed rate | 4.89% | 4.87% | +0.02 |
| 30-year jumbo mortgage rate | 5.70% | 5.63% | +0.07 |
| 30-year mortgage refinance rate | 5.71% | 5.64% | +0.07 |
Updated on July 14, 2022.
How to find the best mortgage rates
To find a personalized mortgage rate, talk to your local mortgage broker or use an online mortgage service. When researching home mortgage rates, take into account your goals and current financial situation. Things that affect what mortgage interest rate you might get include: your credit score, down payment, loan-to-value ratio and your debt-to-income ratio. Generally, you want a higher credit score, a larger down payment, a lower DTI and a lower LTV to get a lower interest rate. Aside from the mortgage interest rate, other costs including closing costs, fees, discount points and taxes might also affect the cost of your house. You should speak with several different lenders — including local and national banks, credit unions and online lenders — and comparison shop to find the best loan for you.
What is the best loan term?
When choosing a mortgage, remember to consider the loan term or payment schedule. The loan 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 stable for the duration of the loan. For adjustable-rate mortgages, interest rates are set for a certain number of years (typically five, seven or 10 years), then the rate changes annually based on the current interest rate in the market.
When deciding between a fixed-rate and adjustable-rate mortgage, you should consider the length of time you plan to live in your home. For those who plan on staying long-term in a new house, fixed-rate mortgages may be the better option. Fixed-rate mortgages offer greater stability over time in comparison to adjustable-rate mortgages, but adjustable-rate mortgages may offer lower interest rates upfront. If you aren’t planning to keep your new home for more than three to 10 years, though, an adjustable-rate mortgage may give you a better deal. There is no best loan term as an overarching rule; it all depends on your goals and your current financial situation. Make sure to do your research and understand your own priorities when choosing a mortgage.