A handful of important mortgage rates decreased today: 15-year fixed and 30-year fixed mortgage rates both trended lower. For variable rates, the 5/1 adjustable-rate mortgage floated slightly higher.
Mortgage rates have been consistently going up since the start of this year, and are expected to keep climbing 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, two of those factors – inflation and the federal funds rate – are particularly influential. The Federal Reserve has already increased interest rates three times this year and has signaled its intention to hike rates again to contain inflation. That will almost certainly 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 5.83%, which is a decline of 6 basis points as seven days ago. (A basis point is equivalent to 0.01%.) The most frequently used loan term is a 30-year fixed mortgage. A 30-year fixed mortgage rate will usually have a lower monthly payment than a 15-year one – but usually 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 5.06%, which is a decrease of 4 basis points 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. However, if you can afford the monthly payments, there are several benefits to a 15-year loan. 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 adjustable-rate mortgage has an average rate of 4.29%, a climb of 3 basis points compared to last week. For the first five years, you’ll typically get a lower interest rate with a 5/1 adjustable-rate mortgage compared to a 30-year fixed mortgage. However, you could end up paying more after that time, depending on the terms of your loan and how the rate changes with the market rate. 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 might be significantly higher once the rate adjusts.
Mortgage rate trends
Though mortgage rates were historically low at the beginning of 2022, they have been rising steadily since then. The reason: The Federal Reserve has raised interest rates by 0.75 percentage points just this month – 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.
Though 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 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 increase as the year goes on.
We use data 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 across the country:
Current average mortgage interest rates
|Loan type||Interest rate||A week ago||Change|
|30-year fixed rate||5.83%||5.89%||-0.06|
|15-year fixed rate||5.06%||5.10%||-0.04|
|30-year jumbo mortgage rate||5.78%||5.81%||-0.03|
|30-year mortgage refinance rate||5.78%||5.88%||-0.10|
Updated on June 30, 2022.
How to find personalized mortgage rates
To find a personalized mortgage rate, speak to your local mortgage broker or use an online mortgage service. When shopping around for home mortgage rates, consider 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 good credit score, a higher down payment, a lower DTI and a lower LTV to get a lower interest rate. The interest rate is not the only factor that affects the cost of your home – be sure to also consider other costs such as fees, closing costs, taxes and discount points. Make sure you talk to a variety of lenders – for example, local and national banks, credit unions and online lenders – and a comparison shop to find the best mortgage loan for you.
What’s the best loan term?
One important factor to consider when choosing a mortgage is 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. Mortgages are further divided into 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 stable for a certain amount of time (most frequently five, seven or 10 years). After that, the rate changes annually based on the market rate.
One thing to think about when choosing between a fixed-rate and adjustable-rate mortgage is how long you plan on staying in your home. For people who plan on staying long-term in a new house, fixed-rate mortgages may be the better option. While adjustable-rate mortgages may offer lower interest rates upfront, fixed-rate mortgages are more stable over time. If you aren’t planning to keep your new house for more than three to 10 years, though, an adjustable-rate mortgage may give you a better deal. The best loan term all depends on your own situation and goals, so be sure to consider what’s important to you when choosing a mortgage.