Mortgage Rates: What You Need to Know
Rates Fluctuate, But It’s Still a Good Time to Buy
Mortgage rates have seen some changes recently, with the 30-year fixed rate dropping by one basis point to 6.72%, while the 15-year fixed rate has risen by three basis points to 6.12%. Meanwhile, the 5/1 ARM rate has decreased by five basis points to 6.73%. Despite these fluctuations, experts believe that mortgage rates won’t plummet anytime soon, and economists predict gradual declines in 2025.
Winter: A Good Time to Buy
Winter can be an ideal time to purchase a home, as there is less competition, giving you a better chance of getting a fair price. If you find a house you love, now might be the perfect time to make a move.
Current Mortgage Rates
Here are the current mortgage rates, according to Zillow data:
- 30-year fixed: 6.72%
- 20-year fixed: 6.55%
- 15-year fixed: 6.12%
- 5/1 ARM: 6.73%
- 7/1 ARM: 6.54%
- 30-year VA: 6.15%
- 15-year VA: 5.66%
- 5/1 VA: 6.38%
Mortgage Refinance Rates
Here are the current mortgage refinance rates, according to Zillow data:
- 30-year fixed: 6.70%
- 20-year fixed: 6.53%
- 15-year fixed: 5.99%
- 5/1 ARM: 6.05%
- 7/1 ARM: 6.70%
- 30-year VA: 6.04%
- 15-year VA: 5.83%
- 5/1 VA: 5.84%
Understanding Mortgage Terms
A mortgage calculator can help you see how different mortgage term lengths and interest rates will impact your monthly payments. Consider factors like property taxes and homeowners insurance when estimating your monthly mortgage payment.
30-Year Mortgage: The Most Popular Choice
The average 30-year mortgage rate is 6.72%. With a 30-year term, your monthly payment is relatively low, but you’ll pay more in interest over the life of your loan.
15-Year Mortgage: A Good Alternative
The average 15-year mortgage rate is 6.12%. A 15-year mortgage comes with a lower interest rate than a 30-year term, but your monthly payments will be higher.
Adjustable-Rate Mortgages: A Risky Option
With an adjustable-rate mortgage, your rate is locked in for a set period of time and then increases or decreases periodically. Adjustable rates usually start lower than fixed rates, but you run the risk that your rate goes up once the introductory rate-lock period is over.
Tips for Getting the Best Mortgage Rate
- Shop around for the best lenders and rates
- Consider saving more, improving your credit score, or paying down debt before applying
- Look into buying down your interest rate permanently or temporarily
- Ask yourself whether the cost of buying down your rate is worth the savings
Stay Informed About Mortgage Rates
Keep an eye on inflation and the latest inflation report to anticipate where interest rates are headed. The Federal Reserve’s decisions on the federal funds rate can also impact mortgage rates.
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