Current Mortgage Interest Rates, April 6, 2022 | Rates remain below 5%
Today, mortgage rates followed a split path, but we saw a significant decline in rates. Average 30-year fixed mortgage rates fell, while average 15-year fixed mortgage rates rose. The most common type of variable rate mortgage is the 5/1 Variable Rate Mortgage (ARM).
In 2022, mortgage rates have nearly reached levels not seen since before the pandemic, after nearly two years of record high rates.
Refinancing or buying your home doesn’t have to be put on hold. Although rates are higher than they were in 2021, 30-year fixed rates are still much lower than they were just a few years ago.
The fact is, a homebuyer’s decision involves more than just an interest rate. It’s a lifestyle decision. Despite the impact of the interest rate market on mortgages, it is not prudent to base your decision on just a few basis points. The most important thing to consider is setting a realistic home buying budget and sticking to it.
Let’s take a look at current mortgage rates, past rates, and what it all means for borrowers.
The averages of the 30-year fixed, 15-year fixed and 5/1 MRAs are:
Mortgage Rate Forecast: What’s Driving Mortgage Rate Changes?
Mortgage rates have risen considerably since the beginning of the year. Two of the factors behind the rate hike are high inflation — the highest in 40 years — and an economy recovering from the pandemic. The Federal Reserve is expected to spend much of the year raising its benchmark short-term interest rate and making other changes to deal with high inflation — moves that could drive up borrowing costs .
Other trends have led to more uncertainty and volatility in the market. One is Russia’s war in Ukraine, which has had repercussions on global financial markets, including rising gas prices and falling inventories. Another is the looming prospect of a resurgence of COVID-19. While the Omicron variant appears to have generally declined in the United States, the future of the virus is impossible to predict with certainty.
Among the experts, there is almost a consensus that mortgage rates will rise throughout 2022. In the short term, anticipate a lot of volatility.
Are current mortgage rates good for buying a home right now?
Even with recent dramatic increases, mortgage rates remain at relatively low levels and are still considered historically favorable.
Historically low interest rates helped offset rising house prices. But the overall cost of home ownership is now rising with rising rates. With a combination of limited supply of homes, prices have risen significantly from pre-pandemic levels. Massive buyer demand and rising home construction costs are also contributing to the surge.
A point or two difference can mean a lot of money on a 30-year mortgage. But experts advise against trying to time the market to get the best mortgage rate. It’s more important to focus on finding the right home and doing it when your personal lifestyle and financial situation indicate that it’s the right time. Mortgage lender rates can vary widely. In order to get the best deal, shop around between a few different mortgage lenders.
Why is it important to look at the 30-year fixed mortgage rate history?
Today’s rates are higher than they were in the low rate years of 2020 and 2021, but they’re still not high if you zoom out before that time. Rates were well above 4% in 2018-19. Before 2008, a “good” rate was considered around 5%. This means that the current mortgage interest rates are still very good in the long term despite the crossing of the psychological barrier of 4%.
NextAdvisor typically uses Bankrate survey data. However, this chart above pulls data from the Freddie Mac survey. Freddie Mac is a government sponsored entity that collects mortgage data. The rates in this chart differ slightly from data elsewhere on this page, historical trends generally follow each other. A look back at historic Freddie Mac rates provides a good look at how current rates compare to those of the past two decades.
Closing costs and loan costs
The catch-all term for the fees you pay to get a mortgage is closing costs. Appraisal fees, title insurance and any lender origination fees are all part of your closing costs. Typically, closing costs range from 3% to 6% of your loan amount. So the higher your mortgage, the more money you will pay. Your closing costs play a crucial role in determining your annual percentage rate (APR). In other words, the higher your closing costs, the higher your APR will be.
Looking at today’s mortgage refinance rates
Checking mortgage refinance rates today, the national average rate for a 30-year fixed refinance declined, while 15-year fixed refinance rates rose. If you’re considering a 10-year refinance loan, just know that average rates have gone up.
Today’s refinance rates are:
Take a look at mortgage rates for different loan styles.
30-year mortgage rates
For a 30-year fixed-rate mortgage, the average rate you’ll pay is 4.86%, down 3 basis points from seven days ago.
15-year mortgage interest rate
The median rate for a 15-year fixed mortgage is 4.07%, up 2 basis points from seven days ago.
The monthly payment on a 15-year fixed rate mortgage is, without a doubt, a much higher monthly payment than you would get on a 30-year mortgage with the same interest rate. However, 15-year loans have significant advantages: you’ll save thousands of dollars in interest and pay off your loan much sooner.
5/1 Adjustable Rate Mortgage Rates
A 5/1 ARM has an average rate of 3.38%, up 12 basis points from last week.
An ARM is ideal for borrowers who will refinance or sell before the rate changes. If not, their interest rates could end up being significantly higher after a rate adjustment.
For the first five years, a 5/1 ARM will typically have a lower interest rate than a 30-year fixed mortgage. Keep in mind that your payment could end up being several hundred dollars higher after a rate adjustment, depending on the terms of your loan.
How We Determine Mortgage Rates
To see where mortgage rates are going, we rely on information collected by Bankrate, which is owned by the same parent company as NextAdvisor. The Daily Rates survey focuses on mortgages where the borrower has a FICO score of 740+, a net worth of 20% or greater, and the home is a primary residence.
Mortgage interest rate data listed below based on the Bankrate Mortgage Rate Survey:
Updated April 6, 2022.
Use our mortgage calculator to see how your mortgage payment changes based on things like your mortgage rate, down payment, and home insurance.
Frequently Asked Questions (FAQ) About Mortgage Rates:
How to get the lowest mortgage rate?
Getting loan deals from a few lenders is one of the best ways to qualify for the lowest mortgage rate.
The mortgage rate you get depends on a variety of factors that lenders take into account when assessing the risk of lending you money to buy a home. Your credit score is factored into the decision. And even the value of the property relative to your mortgage balance matters. So, increasing your down payment can lower your mortgage rate.
But banks will view your situation differently. So you can provide the same documentation to three different mortgage providers and find that none of the mortgage rates and fees you are offered are the same.
Is it a good time to lock in my mortgage rate?
It is impossible to know which direction mortgage rates will go from one day to the next. That’s why a mortgage rate lock is such a useful tool, because it protects you if rates go up. And since interest rates are relatively low right now, you should lock in your rate as soon as possible.
A rate lock will only last for a certain amount of time, usually 30 to 60 days. If you’re having a problem with closing and it looks like your foreclosure rate is expiring, you should talk to your lender. It may offer a lock extension, however, you may need to pay a fee for this privilege.