Current 20-year mortgage rates

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Bankrate has been the authority in personal finance since it was founded in 1976 as the “Bank Rate Monitor,” a print publication for the banking industry. Bankrate has been surveying and collecting mortgage rate information from the nation’s largest lenders for more than 30 years. Hundreds of top publications, such as The New York Times, Wall Street Journal, CNBC and others, depend on Bankrate as a trusted source of financial information, so you know you’re getting information you can trust.

How Bankrate mortgage rates are calculated

Lenders nationwide provide weekday mortgage rates to our comprehensive national survey to bring you the most current rates available. Here you can see the latest marketplace average rates for a wide variety of purchase loans. The interest rate table below is updated daily to give you the most current purchase rates when choosing a home loan. APRs and rates are based on no existing relationship or automatic payments. For these averages, the customer profile includes a 740 FICO score and a single family residence. To learn more, see understanding Bankrate rate averages.

What is a 20-year fixed-rate mortgage?

A 20-year fixed-rate mortgage is a loan where your balance is paid off over 20 years at a fixed interest rate.

The 20-year mortgage is often overlooked by borrowers and lenders, but this unusual loan term comes with a distinct advantage. Compared to the more popular 30-year mortgage, a 20-year loan lets the homeowner shave a decade off the term — and save significantly on interest payments over the life of the mortgage. A 20-year mortgage is a middle ground between the longer, standard term and other short-term options like the popular15-year mortgage or the more aggressive 10-year mortgage.

“A 20-year-fixed is likely [good] for someone who is refinancing for a lower rate and doesn’t want to extend their term back to 30 years. This way, if they are five to 10 years into payments on their current mortgage, they can continue making payments with the hopes of paying off the loan within their target time period,” says David Reiling, CEO of Sunrise Banks, based in Saint Paul, Minnesota. “In a purchase situation, if a client has a goal of paying off their home in less than 30 years, a 20-year fixed is a good alternative that offers lower monthly payments, [as opposed to] a 15-year mortgage.”

To determine if a 20-year mortgage is right for you, do the math using the Bankrate Mortgage Calculator. Get the latest interest rates for 20-year fixed-rate mortgages above. Be sure to check back regularly, as rates do change.

What are the benefits of a 20-year fixed-rate mortgage?

While much depends on the individual mortgage terms, in general, 20-year mortgages have a “shorter term than the traditional 30-year mortgage— which means a faster payoff — and a lower rate than the 30-year option,” Reiling says. He adds that it’s important to carefully consider your household income and whether the monthly payments — including any additional expenses like HOA dues, homeowner’s insurance, property taxes and fees — fit comfortably into your budget.

Though you’ll pay off the mortgage at a faster clip than with a longer term, the payments should be more manageable than an even shorter mortgage. A 10-year term, for example, would require a much higher monthly payment than a 20-year mortgage -- even though the shorter-term loan would cost less in interest over time.

See how your payment would compare to other loan terms

Here’s how monthly payments for principal and interest would compare for a $300,000 mortgage:

What are the downsides of a 20-year fixed-rate mortgage?

If you’re choosing between a 30-year mortgage and a 20-year mortgage, the most significant disadvantage to a 20-year is that the monthly payments will be higher. “With a higher payment, you may need to opt for a more modest house than you would with a 30-year term,” Reiling notes.

On the other hand, if you’re deciding between a 10-year, 15-year mortgage or 20-year mortgage, the drawback of the 20-year is that you’ll pay interest on the loan for either five or 10 more years. However, if you choose a 20-year mortgage with no early repayment penalty (which most mortgages don't have), you could choose to pay the mortgage off even faster, either with additional principal payments each month or with a lump sum to close the mortgage out early.

The point is, the choice of paying more each month is yours with a longer-term loan. But if you lock yourself into a 10-, 15- or 20-year mortgage, you must pay the agreed amount each month. There’s generally no provision to send less money when your budget is tight, although if you find yourself in particularly dire financial straits, you can talk to your lender about forbearance options.

Fees to consider with a 20-year mortgage

The costs and fees with a 20-year mortgage are similar to those of mortgages with other repayment terms. Expect to pay an average of about 2 to 4 percent of the loan’s principal amount at closing in fees, including origination fees and third-party costs like title insurance. It’s possible to wrap these fees into the loan, but doing so will cost you in the long run because you'll wind up paying more in interest.

How to find the best mortgage for you

Once you’ve settled on the length of the mortgage, it’s time to do your research to find the best mortgage for you (see these five kinds of mortgages to consider). This due diligence will mean comparing mortgage rates from several lenders, which might include mortgage brokers, traditional banks and online lenders. It’s smart to prepare for your mortgage search by reviewing your credit report to confirm it’s correct and evaluating your financial landscape to determine how much you can afford to put toward a home each month. “The key is to make sure the client is comfortable with their budget and payment,” says Reiling.

While there is no official “best season” to shop for a mortgage since rates are driven by the market and overall economic landscape, Reiling says, “Banks are much more competitive on rates when business is slow, which tends to be in the dead of winter around January or February.”

Other useful tools

• Mortgage rate forecast: see expert predictions on mortgage trends
• First time homebuyer grants and programs: lower your down payment and closing costs with financial assitance
• Mortgage points: how to use them to cut your interest costs