U.S. Mortgage Rates Update: Lower Than Last Week — See Today’s Best Home Loan Options

If you’re considering buying a home or refinancing your current mortgage, there’s good news this week. While mortgage rates saw a slight increase today, they are still lower compared to last week. This could mean better opportunities for you as a homebuyer or homeowner.

Current Mortgage Rates

According to Zillow, here are the average mortgage rates as of today:

• 30-Year Fixed: 6.51%

• 20-Year Fixed: 6.25%

• 15-Year Fixed: 5.89%

• 5/1 Adjustable-Rate Mortgage (ARM): 6.79%

• 7/1 ARM: 6.92%

• 30-Year VA Loan: 6.09%

• 15-Year VA Loan: 5.57%

• 5/1 VA ARM: 6.07%

Refinance Rates Overview

If you’re thinking about refinancing, here are the latest rates:

• 30-Year Fixed: 6.53%

• 20-Year Fixed: 6.11%

• 15-Year Fixed: 5.88%

• 5/1 ARM: 7.01%

• 7/1 ARM: 7.40%

• 30-Year VA Loan: 6.08%

• 15-Year VA Loan: 5.90%

• 5/1 VA ARM: 6.13%

• 30-Year FHA Loan: 6.01%

• 15-Year FHA Loan: 5.72%

Since refinance rates are often slightly higher than rates for new home purchases, it’s a good idea to evaluate whether refinancing makes sense for your situation.

Fixed vs. Adjustable-Rate Mortgages

Choosing a mortgage often comes down to deciding between a fixed-rate mortgage or an adjustable-rate mortgage (ARM).

• Fixed-Rate Mortgages: These offer stability with the same interest rate throughout the loan term. This means predictable monthly payments, making budgeting easier.

• Adjustable-Rate Mortgages (ARMs): These often start with lower interest rates for a set period, like 5 or 7 years. After that, rates adjust annually. If market rates go down, your payments could too, but they could also increase.

If you plan to stay in your home long-term, a fixed-rate mortgage may be your best choice. On the other hand, if you anticipate moving in a few years, an ARM might be worth considering.

30-Year vs. 15-Year Fixed Mortgages: What’s Right for You?

Choosing between a 30-year and 15-year mortgage can significantly impact your financial future.

• 30-Year Fixed: Lower monthly payments spread over a longer period, but you’ll end up paying more interest overall.

• 15-Year Fixed: Higher monthly payments, but you’ll save a lot on interest and pay off your home sooner.

For example:

• A 30-year loan at 6.51% on a $300,000 mortgage would mean a monthly payment of around $1,898, with total interest of approximately $383,344.

• A 15-year loan at 5.89% would raise the monthly payment to $2,514, but you’d pay significantly less in interest, about $152,480.

How to Get a Better Mortgage Rate

Here are some tips to increase your chances of securing a lower rate:

1. Boost Your Credit Score: Lenders reward borrowers with higher credit scores with lower rates. Paying down debts and making on-time payments can help.

2. Increase Your Down Payment: Putting down a larger amount reduces the lender’s risk, which often means a lower interest rate.

3. Lower Your Debt-to-Income (DTI) Ratio: Paying off debts can improve your DTI ratio, making you a more attractive borrower.

4. Shop Around: Don’t settle for the first offer. Compare quotes from multiple lenders to find the best deal.

Is Refinancing a Smart Move?

If you’re already a homeowner, refinancing could help you reduce your monthly payments or shorten your loan term. It’s particularly beneficial if your current mortgage has a higher interest rate than what’s available now.

Refinancing may be a good choice if you want to:

• Lower your monthly mortgage payment

• Switch from an ARM to a fixed-rate loan for stability

• Pay off your loan faster with a shorter term

Be sure to factor in refinancing costs to ensure the long-term savings outweigh the expenses.

What to Consider with Today’s Mortgage Rates

While today’s mortgage rates have inched up slightly, they’re still lower than they were a week ago. For homebuyers, this may be a good opportunity to lock in a favorable rate before any potential increases. If you’re considering refinancing, now could be the right time to explore your options, especially if your current rate is significantly higher.

Keep in mind that your individual rate will depend on factors like your credit score, down payment amount, and overall financial profile. Taking steps to improve these areas could help you secure a better deal.

Whether you’re purchasing your first home, refinancing an existing loan, or weighing your mortgage options, it’s always smart to compare lenders, ask questions, and make informed decisions that align with your financial goals.

Also Read: U.S. Mortgage Rates Drop, But Buying a Home Still Isn’t Easy