karamysh/Shutterstock

karamysh/Shutterstock

Multiple key mortgage rates decreased today. The average rates on 30-year fixed and 15-year fixed mortgages both declined. The average rate on 5/1 adjustable-rate mortgages, meanwhile, also fell.

Rates for mortgages are in a constant state of flux, but they remain low by historical standards. If you’re in the market for a mortgage, it may make sense to go ahead and lock if you see a rate you like. Just be sure to shop around.

See mortgage rates for a variety of loan types.

30-year fixed mortgages

The average 30-year fixed-mortgage rate is 3.45 percent, a decrease of 12 basis points from a week ago. A month ago, the average rate on a 30-year fixed mortgage was higher, at 3.54 percent.

At the current average rate, you’ll pay $446.26 per month in principal and interest for every $100,000 you borrow. That’s $6.70 lower, compared with last week.

You can use Bankrate’s home loan calculator to figure out your monthly payments and see the effect of adding extra payments. It will also help you determinehow much interest you’ll pay over the life of the loan.

15-year fixed mortgages

The average 15-year fixed-mortgage rate is 2.83 percent, down 6 basis points from a week ago.

Monthly payments on a 15-year fixed mortgage at that rate will cost around $682 per $100,000 borrowed. That may squeeze your monthly budget than a 30-year mortgage would, but it comes with some big advantages: You’ll save thousands of dollars over the life of the loan in total interest paid and build equity much more rapidly.

5/1 ARMs

The average rate on a 5/1 adjustable rate mortgageis 3.19 percent, falling 12 basis points from a week ago.

These types of loans are best for people who expect to refinance or sell before the first or second adjustment. Rates could be much higher when the loan first adjusts, and thereafter.

Monthly payments on a 5/1 ARM at 3.19 percent would cost about $432 for each $100,000 borrowed over the initial five years, but could increase by hundreds of dollars afterward, depending on the loan’s terms.

Where rates are headed

To see where Bankrate’s panel of experts expect rates to go from here, check out our mortgage rate projections.

Want to see where rates are at this moment? Lenders nationwide respond to our weekday mortgage rates 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:

Current average mortgage interest rates
Loan type Interest rate A week ago Change
30-year fixed rate 3.45% 3.57% -0.12
15-year fixed rate 2.83% 2.89% -0.06
30-year fixed jumbo rate 3.53% 3.71% -0.18
30-year fixed refinance rate 3.54% 3.68% -0.14

Updated on June 3, 2020.

Rate lock advice and recommendations

A rate lock guarantees your interest rate for a specified period of time. It’s common for lenders to offer 30-day rate locks for a fee or to include the price of the rate lock into your loan. Some lenders will lock rates for longer periods, even exceeding 60 days, but those locks can be expensive. In today’s volatile market, some lenders will lock an interest rate for only two weeks because they don’t want to take on unnecessary risk.

The benefit of a rate lock is that if interest rates rise, you’re locked into the guaranteed rate. Some lenders have a floating-rate lock option, which allows you to get a lower rate if interest rates fall before you close your loan. In a falling rate environment, a float-down lock could be worth the cost. Because there is no guarantee of where mortgage rates will head in the future, it may be smart to lock in a low rate instead of holding out on rates for potentially decline further.

Keep in mind that during the pandemic, all aspects of real estate and mortgage closings are taking much longer than usual. Expect the closing on a new mortgage to take at least 60 days, and expect refinancing to take at least a month..

Why do mortgage rates move up and down?

A number of economic factors influence mortgage rates. Among them are inflation and unemployment. Higher inflation typically leads to higher mortgage rates. The opposite is also true; when inflation is low, mortgage rates typically are as well. As inflation increases, the dollar loses value. That drives investors away from mortgage-backed securities (MBS), which causes the prices to decrease and yields to increase. When yields move higher, rates become more expensive for borrowers.

A strong economy usually means more people buying homes, which drives demand for mortgages. This increased demand can push rates higher. The opposite is also true; less demand can trigger a drop in rates.

What are current mortgage rates?

The current mortgage rate environment has been unstable because of the coronavirus pandemic, but generally rates have been low. For a while, some lenders were increasing rates because they were struggling to deal with the demand. In general, however, rates are consistently below 4 percent and even dipping into the mid to low 3s. This is an especially good time for people with good to excellent credit to lock in a low rate for a purchase loan. However, lenders are also raising credit standards for borrowers and demanding higher down payments as they try to dampen their risks.

Methodology: The rates you see above are Bankrate.com Site Averages. These calculations are run after the close of the previous business day and include rates and/or yields we have collected that day for a specific banking product. Bankrate.com site averages tend to be volatile — they help consumers see the movement of rates day to day. The institutions included in the “Bankrate.com Site Average” tables will be different from one day to the next, depending on which institutions’ rates we gather on a particular day for presentation on the site.

To learn more about the different rate averages Bankrate publishes, see “Understanding Bankrate’s average rates.”

Searching for a mortgage lender? See Bankrate’s mortgage lender reviews.

See rates for a variety of loan types
Loan Type Purchase Rates Refinance Rates
The chart above links out to loan-specific content to help you learn more about rates by product type.
30-Year Loan 30-Year Mortgage Rates Current 30 Year Refinance Rates
20-Year Loan Current 20 Year Mortgage Rates 20-Year Refinance Rates
15-Year Loan 15 Year Fixed Mortgage Rates 15-Year Mortgage Refinance Rates
10-Year Loan 10-Year Mortgage Rates 10-Year Mortgage Refinance Rates
FHA Loan FHA Mortgage Loan Rates FHA Mortgage Refi Rates
VA Loan VA Mortgage Rates Current VA Refinance Rates
ARM Loan ARM Loan Rates ARM Refinance Rates
Jumbo Loan Current Jumbo Mortgage Rates Jumbo Loan Refinance Rates