A number of principal mortgage rates increased today. 15-year fixed and 30-year fixed mortgage rates both climbed higher. We also saw a hike in the average rate of 5/1 adjustable-rate mortgages.
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 30-year fixed mortgage interest rate is 5.27%, which is a growth of 13 basis points from one week ago. (A basis point is equivalent to 0.01%.) Thirty-year fixed mortgages are the most frequently used loan term. A 30-year fixed rate mortgage will usually have a smaller monthly payment than a 15-year one — but typically 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 4.44%, which is an increase of 13 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. But a 15-year loan will usually be the better deal, as long as you can afford the monthly payments. 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 adjustable-rate mortgage has an average rate of 5.23%, a rise of 13 basis points compared to a week ago. 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 might 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. If not, shifts in the market may significantly increase your interest rate.
Mortgage rate trends
While 2022 started with low mortgage rates, there has been an increase recently, and rates are expected to continue going up throughout 2022. Home loan rates are influenced by multiple 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 going higher.
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 US:
Average mortgage interest rates
| Product | Rate | Last week | Change |
|---|---|---|---|
| 30-year fixed | 5.27% | 5.14% | +0.13 |
| 15-year fixed | 4.44% | 4.31% | +0.13 |
| 30-year jumbo mortgage rate | 3.59% | 3.52% | +0.07 |
| 30-year mortgage refinance rate | 5.25% | 5.16% | +0.09 |
Rates as of Apr. 20, 2022.
How to find personalized mortgage rates
To find a personalized mortgage rate, meet with your local mortgage broker or use an online mortgage service. When looking into home mortgage rates, take into account your goals and current finances. Specific mortgage rates will vary based on factors including credit score, down payment, debt-to-income ratio and loan-to-value ratio. Having a higher 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. Beyond the mortgage rate, other costs including closing costs, fees, discount points and taxes might also factor into the cost of your house. Make sure you speak with a variety of lenders — for example, 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 keep in mind when choosing a mortgage is 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 the same 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 (typically five, seven or 10 years). After that, the rate fluctuates annually based on the market rate.
When choosing between a fixed-rate and adjustable-rate mortgage, you should take into consideration the length of time you plan to stay in your house. Fixed-rate mortgages might be a better fit for people who plan on staying in a home for a while. Fixed-rate mortgages offer greater stability over time compared to adjustable-rate mortgages, but adjustable-rate mortgages may offer lower interest rates upfront. However you could get a better deal with an adjustable-rate mortgage if you’re only planning to keep your home for a couple years. The best loan term all depends on your situation and goals, so make sure to take into consideration what’s important to you when choosing a mortgage.
