Today’s best mortgage and refinance rates, June 23rd, 2022 | Most rates fall

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Mortgage rates were mostly down compared to a week ago, according to data compiled by Bankrate. Rates for 30-year fixed, 15-year fixed and jumbo loans declined, while rates for adjustable rate mortgages rose.

Average home loan rates
Loan term Today’s Rate Last week Change
30-year mortgage rate 5.89% 5.91% -0.02
15-year mortgage rate 5.10% 5.11% -0.01
5/1 ARM mortgage rate 4.26% 4.02% +0.24
30-year jumbo mortgage rate 5.81% 5.88% -0.07

Rates accurate as of June 23, 2022.

These rates are Bankrate’s overnight average rates and are based on the assumptions indicated here. Actual rates available on-site may vary. This story has been reviewed by Bill McGuire. All rate data accurate as of Thursday, June 23rd, 2022 at 7:30 a.m.

You can save thousands of dollars over the life of your mortgage by getting multiple offers.

“All too often, some homeowners take the path of least resistance when seeking a mortgage, in part because the process of buying a home can be stressful, complicated and time-consuming,” says Mark Hamrick, Bankrate senior economic analyst. “But when we’re talking about the potential of saving a lot of money, seeking the best deal on a mortgage has an excellent return on investment. Why leave that money on the table when all it takes is a bit more effort to shop around for the best rate, or lowest cost, on a mortgage?”

Mortgage rates

30-year mortgage declines, -0.02%

The average rate you’ll pay for a 30-year fixed mortgage is 5.89 percent, down 2 basis points since the same time last week. A month ago, the average rate on a 30-year fixed mortgage was lower, at 5.28 percent.

At the current average rate, you’ll pay principal and interest of $591.86 for every $100,000 you borrow.

30-year mortgage vs. 15-year mortgage

Traditional lending practices defer to the 30-year, fixed-rate mortgage as the go-to for most borrowers because it allows the borrower to spread mortgage payments out over 30 years, keeping their monthly payment lower.

With a 15-year mortgage, however, borrowers can pay off their loan in half the time — if they’re able and willing to bump up the amount of their monthly loan payment. The primary difference between qualifying for a 15-year versus a 30-year mortgage is that you’ll need a higher income and lower debt-to-income ratio to obtain the former because the monthly mortgage payments are higher.

15-year mortgage declines,-0.01%

The average rate for a 15-year fixed mortgage is 5.10 percent, down 1 basis point over the last week.

Monthly payments on a 15-year fixed mortgage at that rate will cost $539 per $100,000 borrowed. The bigger payment may be a little more difficult to find room for in your monthly budget than a 30-year mortgage payment would, but it comes with some big advantages: You’ll come out several thousand dollars ahead over the life of the loan in total interest paid and build equity much more rapidly.

5/1 ARM increases, +0.24%

The average rate on a 5/1 adjustable rate mortgage is 4.26 percent, ticking up 24 basis points from a week ago.

Adjustable-rate mortgages, or ARMs, are mortgage 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 loans. These loan types are best for people who expect to sell or refinance before the first or second adjustment. Rates could be substantially higher when the loan first adjusts, and thereafter.

While borrowers shunned ARMs during the pandemic days of super-low rates, this type of loan has made a comeback as mortgage rates have risen.

Monthly payments on a 5/1 ARM at 4.26 percent would cost about $489 for each $100,000 borrowed over the initial five years, but could increase by hundreds of dollars afterward, depending on the loan’s terms.

Jumbo mortgage rate moves lower, -0.07%

The average jumbo mortgage rate today is 5.81 percent, down 7 basis points over the last week. Last month on the 23rd, the average rate for jumbo mortgages was below that, at 5.24 percent.

At the current average rate, you’ll pay a combined $584.21 per month in principal and interest for every $100,000 you borrow.

Recap: How interest rates have changed this week

  • 30-year fixed mortgage rate: 5.89%, down from 5.91% last week, -0.02
  • 15-year fixed mortgage rate: 5.10%, down from 5.11% last week, -0.01
  • 5/1 ARM mortgage rate: 4.26%, up from 4.02% last week, +0.24
  • Jumbo mortgage rate: 5.81%, down from 5.88% last week, -0.07

Interested in refinancing? See mortgage refinance rates

Current 30 year mortgage refinance rate retreats, –0.01%

The average 30-year fixed-refinance rate is 5.88 percent, down 1 basis point over the last seven days. A month ago, the average rate on a 30-year fixed refinance was lower, at 5.26 percent.

At the current average rate, you’ll pay $584.21 per month in principal and interest for every $100,000 you borrow. That’s a decline of $7.65 from last week.

Where mortgage rates are headed

Mortgage rates plunged early in the pandemic and scraped record lows — below 3 percent — at the start of 2021. The days of sub-3 percent mortgage interest on the 30-year fixed are behind us, and rates rose past 5 percent in 2022.

“Low interest rates were the medicine for economic recovery following the financial crisis, but it was a slow recovery so rates never went up very far,” says Greg McBride, CFA, Bankrate chief financial analyst. “The rebound in the economy, and especially inflation, in the late pandemic stages has been very pronounced, and we now have a backdrop of mortgage rates rising at the fastest pace in decades.”

Comparing mortgage terms

The 30-year fixed mortgage is the most popular loan for homeowners. This type of loan has a number of advantages, including:

  • Lower monthly payment: Compared to a shorter term, such as 15 years, the 30-year mortgage offers lower payments spread over time.
  • Stability: With a 30-year mortgage, you lock in a consistent principal and interest payment. Because of the predictability, you can plan your housing expenses for the long term. Remember: Your monthly housing payment can change if your homeowners insurance and property taxes go up or, less likely, down.
  • Buying power: With lower payments, you can qualify for a larger loan amount and a more expensive home.
  • Flexibility: Lower monthly payments can free up some of your monthly budget for other goals, like saving for emergencies, retirement, college tuition or home repairs and maintenance.
  • Strategic use of debt: Some argue that Americans focus too much on paying down their mortgages rather than adding to their retirement accounts. A 30-year fixed mortgage with a smaller monthly payment can allow you to save more for retirement.

That said, shorter term loans have gained popularity as rates have been historically low. Although they have higher monthly payments compared to 30-year mortgages, there are some big benefits if you can afford the upfront costs. Shorter-term loans can help you achieve:

  • Greatly reduced interest costs: Because you pay off the loan faster, you’ll be able to pay less interest overall.
  • Lower interest rate: On top of less time for that interest to compound, most lenders price shorter-term mortgages with lower rates.
  • Build equity faster: The faster you pay off your mortgage, the faster you’ll own value in your home outright. That’s especially handy if you want to borrow against your property to fund other spending.
  • Debt-free sooner: A shorter-term mortgage means you’ll own your house free and clear sooner than you would with a longer-term loan.

Is now a good time to buy a house?

There’s never a straightforward answer to this question. It always depends. Do you have a reliable income, a good credit score and money saved for a down payment and repairs? If you can answer all of those questions affirmatively, you’re ready to buy.

However, the pandemic has led to an even greater shortage of homes. That’s caused a bidding war and rising prices. Those trends mean it can be a frustrating market for buyers.

What comes next:

Today’s featured lenders, June 23, 2022