Today’s mortgage and refinance rates, December 28, 2021: Majority of rates rise

Mortgage interest rates were mostly up compared to a week ago, according to data compiled by Bankrate. Rates for 30-year fixed, 15-year fixed and jumbo loans moved higher, while 5/1 ARM rates remained flat.

Rates accurate as of December 28, 2021.

These rates are Bankrate’s overnight average rates and are based on the assumptions shown here. Actual rates listed on-site may vary. This story has been reviewed by Bill McGuire. All rate data accurate as of Tuesday, December 28th, 2021 at 7:30am.

You can save thousands of dollars over the life of your mortgage by getting multiple offers. “It is so important to shop around,” says Greg McBride, CFA, Bankrate chief financial analyst. “Not everyone offers the same price, and some lenders may have motivation to be very competitive on price.”

Mortgage rates for home purchase

Today’s 30-year mortgage rate trends upward, +0.04%

The average rate for the benchmark 30-year fixed mortgage is 3.24 percent, an increase of 4 basis points from a week ago. Last month on the 28th, the average rate on a 30-year fixed mortgage was lower, at 3.23 percent.

At the current average rate, you’ll pay $428.10 per month in principal and interest 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 scatter 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 enlarge 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 a 15-year mortgage because the monthly payments are loftier.

15-year fixed mortgage rate moves up,+0.01%

The average rate you’ll pay for a 15-year fixed mortgage is 2.51 percent, up 1 basis point over the last seven days.

Monthly payments on a 15-year fixed mortgage at that rate will cost approximately $390 per $100,000 borrowed. That’s obviously much higher than the monthly payment would be on a 30-year mortgage at that rate, 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 quickly.

5/1 ARM rate stays put

The average rate on a 5/1 adjustable rate mortgageis 2.74 percent, unchanged over the last week.

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 from time to time 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 much higher when the loan first adjusts, and thereafter.

Monthly payments on a 5/1 ARM at 2.74 percent would cost about $402 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 interest rate climbs, +0.05%

is 3.24 percent, up 5 basis points over the last week. Last month on the 28th, the average rate was below that, at 3.22 percent.

At the average rate today for a jumbo loan, you’ll pay $434.66 per month in principal and interest for every $100k you borrow. Compared to last week, that’s $6.56 higher.

In summary: How mortgage rates have changed this week

  • 30-year fixed mortgage rate: 3.24%, up from 3.20% last week, +0.04
  • 15-year fixed mortgage rate: 2.51%, up from 2.50% last week, +0.01
  • 5/1 ARM mortgage rate: 2.74%, unchanged from last week
  • Jumbo mortgage rate: 3.24%, up from 3.19% last week, +0.05

Interested in refinancing? See mortgage refinance rates

Today’s 30-year mortgage refinance rate increases, +0.06%

The average 30-year fixed-refinance rate is 3.22 percent, up 6 basis points over the last seven days. A month ago, the average rate on a 30-year fixed refinance was lower, at 3.20 percent.

At the current average rate, you’ll pay $428.10 per month in principal and interest for every $100,000 you borrow.

6 steps to obtaining the best mortgage rate

  1. Improve your credit score
  2. Build a record of employment
  3. Save up for a down payment
  4. Go for a 15-year fixed-rate mortgage
  5. Shop among multiple lenders
  6. Lock in your rate

Read more about how these 6 steps can secure you a lower rate.

Keep reading:

Today’s featured lenders, December 28, 2021

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