A handful of important mortgage rates are now higher today. 15-year fixed and 30-year fixed mortgage rates both moved up. The average rate of the most common type of variable-rate mortgage, the 5/1 adjustable-rate mortgage, also floated higher.
Mortgage rates have been slowly rising since the start of this year, and are expected to increase throughout 2022. While rates are above their historic records set earlier in the pandemic, they’re still relatively low. Interest rates are dynamic — they rise and fall on a daily basis due to numerous economic factors. In general, now is a good time for prospective homebuyers to lock in a lower rate rather than later this year. Speaking with multiple lenders will help you find the best rate available for your financial situation.
30-year fixed-rate mortgages
The average interest rate for a standard 30-year fixed mortgage is 5.25%, which is a growth of 19 basis points compared to one week ago. (A basis point is equivalent to 0.01%.) Thirty-year fixed mortgages are the most common loan term. 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. 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 4.42%, which is an increase of 22 basis points from the same time last week. Compared to a 30-year fixed mortgage, a 15-year fixed mortgage with the same loan value and interest rate will have a bigger monthly payment. However, if you’re able to afford the monthly payments, there are several benefits to a 15-year loan. These include typically 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 5.22%, an addition of 19 basis points compared to last week. 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 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 ARM may make sense for you. Otherwise, shifts in the market means your interest rate could be much higher once the rate adjusts.
Mortgage rate trends
Though 2022 kicked off with low mortgage rates, there has been a steady rise recently, and rates are expected to continue going up throughout 2022. Home loan rates are influenced by various economic factors. A major one is government policy set by the Federal Reserve, which raised rates in March for the first time since 2018 in response to record-high inflation. The Fed anticipates raising interest rates six more times this year. However, with the ongoing war in Ukraine, we’ve seen some fluctuations in mortgage rates, as global instability generally causes interest rates to drop. While you can expect rates to go up and down for these reasons, in general, if you’re looking to buy a house in 2022, you should be prepared for interest rates to keep rising.
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 nationwide:
Average mortgage interest rates
| Product | Rate | Last week | Change |
|---|---|---|---|
| 30-year fixed | 5.25% | 5.06% | +0.19 |
| 15-year fixed | 4.42% | 4.20% | +0.22 |
| 30-year jumbo mortgage rate | 3.55% | 3.46% | +0.09 |
| 30-year mortgage refinance rate | 5.24% | 5.07% | +0.17 |
Rates as of Apr. 18, 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. Make sure to consider your current financial situation and your goals when looking for a mortgage. Things that affect what the interest rate you might get on your mortgage include: your credit score, down payment, loan-to-value ratio and your debt-to-income ratio. Having a good credit score, a higher 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 mortgage interest rate, other factors including closing costs, fees, discount points and taxes might also affect the cost of your home. You should comparison shop with multiple lenders — for example, credit unions and online lenders in addition to local and national banks — in order to get a mortgage that works best for you.
What’s the best loan term?
When picking a mortgage, it’s important to 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 the same 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 (commonly five, seven or 10 years). After that, the rate fluctuates annually based on the current interest rate in the market.
One important factor 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. If you plan on staying long-term in a new house, fixed-rate mortgages may be the better option. Fixed-rate mortgages offer more stability over time compared to adjustable-rate mortgages, but adjustable-rate mortgages might offer lower interest rates upfront. However you could get a better deal with an adjustable-rate mortgage if you only have plans to to keep your home for a few years. The best loan term all depends on your personal situation and goals, so be sure to think about what’s important to you when choosing a mortgage.
