Key mortgage rates, including 15-year fixed and 30-year fixed mortgages, are continuing to climb to the highest levels since before the pandemic. The average rate of 5/1 adjustable-rate mortgages has also gone up. With mortgage rates at historic lows over the last period, it’s been a fine time for prospective homebuyers to lock in a fixed rate. However, rates fluctuate and are projected to keep going up. Before you buy a house, consider your personal needs and financial situation, and remember to speak with multiple lenders to find the best one for you.
30-year fixed-rate mortgages
The 30-year fixed-mortgage rate average is 3.77%, which is a growth of 9 basis points compared to one week 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 will typically have a greater interest rate than a 15-year fixed rate mortgage — but also a lower monthly payment. 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 3.15%, which is an increase of 12 basis points from the same time last week. You’ll definitely have a higher 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. 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 3.75%, an uptick of 8 basis points from the same time 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, shifts in the market may cause your interest rate to increase after that time, as detailed in the terms of your loan. Because of this, an ARM may be a good option if you plan to sell or refinance your house before the rate changes. If not, shifts in the market might significantly increase your interest rate.
Mortgage rate trends
While 2022 kicked off with low mortgage rates, they have seen an uptick recently. There are two major factors at play here: increasing inflation rates and a growing economy. That said, rates can always rise and fall for a variety of reasons. The spread of omicron, for instance, kept rates relatively low throughout December and the start of the new year. Overall, rates are expected to go up in 2022, particularly with the Federal Reserve’s decision to reduce its bond purchases and increase interest rates.
We use information 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 across the country:
Average mortgage interest rates
| Product | Rate | Last week | Change |
|---|---|---|---|
| 30-year fixed | 3.77% | 3.68% | +0.09 |
| 15-year fixed | 3.15% | 3.03% | +0.12 |
| 30-year jumbo mortgage rate | 2.84% | 2.80% | +0.04 |
| 30-year mortgage refinance rate | 3.76% | 3.68% | +0.08 |
Rates as of Feb. 2, 2022.
How to find the best mortgage rates
You can get a personalized mortgage rate by reaching out to your local mortgage broker or using an online calculator. Make sure to take into account your current finances and your goals when trying to find a mortgage. Specific interest rates will vary based on factors including credit score, down payment, debt-to-income ratio and loan-to-value ratio. Having a good 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. Apart from the interest rate, additional costs including closing costs, fees, discount points and taxes might also affect the cost of your home. Make sure you talk to several different lenders — like local and national banks, credit unions and online lenders — and comparison shop to find the best mortgage for you.
What is a good loan term?
One important thing to consider when choosing a mortgage is the loan term, or payment schedule. The most common loan terms are 15 years and 30 years, although 10-, 20- and 40-year mortgages also exist. Another important distinction is between fixed-rate and adjustable-rate mortgages. For fixed-rate mortgages, interest rates are stable for the life of the loan. For adjustable-rate mortgages, interest rates are set for a certain number of years (usually five, seven or 10 years), then the rate fluctuates annually based on the market interest rate.
One thing to take into consideration when deciding between a fixed-rate and adjustable-rate mortgage is the length of time you plan on living in your home. Fixed-rate mortgages might be a better fit if you plan on staying in a home for a while. While adjustable-rate mortgages can sometimes offer lower interest rates upfront, fixed-rate mortgages are more stable in the long term. However you might get a better deal with an adjustable-rate mortgage if you only have plans to keep your home for a few years. The best loan term all depends on your specific situation and goals, so be sure to take into consideration what’s important to you when choosing a mortgage.
