Mortgage rates jumped for all loan terms compared to a week ago, according to data compiled by Bankrate. Rates for 30-year fixed, 15-year fixed, 5/1 ARMs and jumbo loans rose.
Rates accurate as of June 15, 2022.
The rates listed here are Bankrate’s overnight average rates and are based on the assumptions shown here. Actual rates listed across the site may vary. This story has been reviewed by in-house editor Bill McGuire. All rate data accurate as of Wednesday, June 15th, 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 trends upward, +0.42%
- 15-year fixed mortgage moves upward,+0.45%
- 5/1 ARM rate trends higher, +0.10%
- Current jumbo mortgage rate rises, +0.42%
- Rate review: How mortgage rates have changed this week
- Interested in refinancing? See mortgage refinance rates
- Current 30 year mortgage refinance rate moves higher, +0.45%
- Mortgage rate trends: Where rates are headed
- Comparing mortgage terms
- How does credit score affect my mortgage rate?
- Keep reading:
- Today’s featured lenders, June 15, 2022
30-year mortgage trends upward, +0.42%
The average rate for the benchmark 30-year fixed mortgage is 5.97 percent, up 42 basis points since the same time last week. A month ago, the average rate on a 30-year fixed mortgage was lower, at 5.40 percent.
At the current average rate, you’ll pay $591.86 per month in principal and interest for every $100,000 you borrow. That’s an increase of $22.82 over what you would have paid last week.
15-year fixed mortgage moves upward,+0.45%
The average rate for the benchmark 15-year fixed mortgage is 5.15 percent, up 45 basis points from a week ago.
Monthly payments on a 15-year fixed mortgage at that rate will cost roughly $539 per $100k borrowed. The bigger payment may be a little tougher 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 rate trends higher, +0.10%
The average rate on a 5/1 ARM is 4.02 percent, up 10 basis points since the same time last week.
Adjustable-rate mortgages, or ARMs, are home loans that come with a floating interest rate. In other words, the interest rate can change from time to time throughout the life of the loan, unlike fixed-rate mortgages. These types of loans are best for those who expect to sell or refinance before the first or second adjustment. Rates could be materially 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 4.02 percent would cost about $475 for each $100,000 borrowed over the initial five years, but could climb hundreds of dollars higher afterward, depending on the loan’s terms.
Current jumbo mortgage rate rises, +0.42%
Today’s average rate for jumbo mortgages is 5.96 percent, up 42 basis points over the last week. This time a month ago, the average rate was lesser, at 5.36 percent.
At today’s average jumbo rate, you’ll pay principal and interest of $591.86 for every $100,000 you borrow. That’s an increase of $22.82 over what you would have paid last week.
Rate review: How mortgage rates have changed this week
- 30-year fixed mortgage rate: 5.97%, up from 5.55% last week, +0.42
- 15-year fixed mortgage rate: 5.15%, up from 4.70% last week, +0.45
- 5/1 ARM mortgage rate: 4.02%, up from 3.92% last week, +0.10
- Jumbo mortgage rate: 5.96%, up from 5.54% last week, +0.42
Interested in refinancing? See mortgage refinance rates
Current 30 year mortgage refinance rate moves higher, +0.45%
The average 30-year fixed-refinance rate is 5.99 percent, up 45 basis points from a week ago. A month ago, the average rate on a 30-year fixed refinance was lower, at 5.34 percent.
At the current average rate, you’ll pay $591.86 per month in principal and interest for every $100,000 you borrow. That’s $22.82 higher compared with last week.
Mortgage rate trends: Where 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.
How does credit score affect my mortgage rate?
A credit score of 760 or higher generally will help you qualify for the best rates offered by any mortgage lender. However, you don’t need excellent credit to qualify for a mortgage. Loans insured by the Federal Housing Administration, or FHA, have a minimum credit score requirement of just 580.
Ideally if you have a lower score, you want to work on your credit to get the best loan offers possible. While you can get a mortgage with poor or bad credit, your interest rate and terms may not be as cheap.