National mortgage rates were mostly down compared to a week ago. Rates for 30-year fixed, 15-year fixed and jumbo loans moved lower, while rates for adjustable rate mortgages rose.
|Loan term||Today’s Rate||Last week||Change|
|30-year mortgage rate||3.03%||3.06%||-0.03|
|15-year mortgage rate||2.38%||2.42%||-0.04|
|5/1 ARM mortgage rate||2.81%||2.80%||+0.01|
|30-year jumbo mortgage rate||3.04%||3.12%||-0.08|
Rates accurate as of July 19, 2021.
These rates are marketplace averages based on the assumptions shown here. Actual rates displayed on-site may vary. This story has been reviewed by in-house editor Bill McGuire. All rate data accurate as of Monday, July 19th, 2021 at 7:30am.
Mortgage rates for home purchase
30-year mortgage declines, -0.03%
The average rate you’ll pay for a 30-year fixed mortgage is 3.03 percent, down 3 basis points over the last seven days. A month ago, the average rate on a 30-year fixed mortgage was higher, at 3.17 percent.
At the current average rate, you’ll pay principal and interest of $421.60 for every $100k you borrow.
While the 30-year rate is the most popular mortgage term, as with any financial product, the 30-year mortgage has some downsides, including:
- More total interest paid. A 30-year term means you’ll pay more overall in interest compared with what you’d pay with a shorter-term loan.
- Higher mortgage rates. Compared to 15-year loans, lenders charge higher interest rates for 30-year loans because they’re taking on the risk of not being repaid for a longer time span.
- Slower equity growth. The amortization table for a 30-year mortgage reveals a harsh reality: In the early years, almost all of your payments go to interest rather than principal. A 15-year loan brings a higher monthly payment but much faster payoff of the loan amount.
- Buying a more expensive house than you should. Just because you might be able to afford more house with a 30-year loan doesn’t mean you should stretch your budget to the breaking point. Give yourself some breathing room for other financial goals and unexpected expenses. Use Bankrate’s home affordability calculator to determine how much house you can afford.
- 30-year fixed mortgage rate: 3.03%, down from 3.06% last week, -0.03
- 15-year fixed mortgage rate: 2.38%, down from 2.42% last week, -0.04
- 5/1 ARM mortgage rate: 2.81%, up from 2.80% last week, +0.01
- Jumbo mortgage rate: 3.04%, down from 3.12% last week, -0.08
- Loans and programs for first time homebuyers
- Everything to know about FHA loans
- How much will you pay in closing costs?
15-year mortgage eases,-0.04%
The average rate for a 15-year fixed mortgage is 2.38 percent, down 4 basis points since the same time last week.
Monthly payments on a 15-year fixed mortgage at that rate will cost around $384 per $100k borrowed. Yes, that payment is much bigger than it would be on a 30-year mortgage, 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 quickly.
5/1 ARM rises, +0.01%
The average rate on a 5/1 adjustable rate mortgageis 2.81 percent, climbing 1 basis point over the last 7 days.
Adjustable-rate mortgages, or ARMs, are home loans that come with a floating interest rate. To put it another way, the interest rate can change intermittently throughout the life of the loan, unlike fixed-rate mortgages. These types of loans are best for people who expect to refinance or sell before the first or second adjustment. Rates could be considerably higher when the loan first adjusts, and thereafter.
Monthly payments on a 5/1 ARM at 2.81 percent would cost about $409 for each $100,000 borrowed over the initial five years, but could ratchet higher by hundreds of dollars afterward, depending on the loan’s terms.
Jumbo mortgage interest rate moves down, -0.08%
The average jumbo mortgage rate is 3.04 percent, down 8 basis points over the last seven days. A month ago, the average rate on a jumbo mortgage was greater than 3.04, at 3.19 percent.
At the average rate today for a jumbo loan, you’ll pay principal and interest of $421.60 for every $100k you borrow. That’s down $6.50 from what it would have been last week.
Rate review: How mortgage rates have shifted over the past week
Mortgage refinance rates
30-year fixed-rate refinance goes unchanged
The average 30-year fixed-refinance rate is 3.10 percent, unchanged since the same time last week. A month ago, the average rate on a 30-year fixed refinance was higher, at 3.23 percent.
At the current average rate, you’ll pay $421.60 per month in principal and interest for every $100,000 you borrow.
What causes mortgage rates to change
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.
Generally speaking, when the economy is strong, more people buy homes. That drives demand for mortgages. Increased demand for mortgages can cause rates to increase. The opposite is also true; less demand can lead to lower rates.