Current mortgage interest rates as of July 22, 2021: rates continue to fall



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Mortgage rates continued to decline today. Average rates on fixed rate mortgages for 15 and 30 years have declined, while the average rate on 5/1 adjustable rate mortgages has also declined. Mortgage rates are dynamic, but are currently at historic lows. If you are looking to buy a new home, this may be the right time to lock in a low flat rate. Before applying for a home loan, we recommend that you research your financial goals and find the most suitable mortgage for your needs.

Find out current mortgage rates for today

30 year fixed rate mortgage

The average 30-year fixed interest rate on mortgages is 2.98%, down 6 basis points from a week ago. (The base point is equivalent to 0.01%.) The most common loan term is a fixed mortgage for 30 years. A 30 year fixed rate mortgage will usually have a higher interest rate than a 15 year fixed rate mortgage, but will also have a lower monthly payment. Although you will pay more interest over time – you pay off the loan over a longer period – if you are looking for a lower monthly payment, a 30-year fixed mortgage may be a good option.

Mortgage with a fixed interest rate for 15 years

The average rate for a 15-year fixed mortgage is 2.33%, down 5 basis points from the same period last week. You will definitely have a higher monthly payment with a 15 year fixed mortgage compared to a 30 year fixed mortgage, even if the interest rate and loan amount are the same. However, if you can afford the monthly payments, there are several advantages to a 15-year loan. You will most likely get a lower interest rate and pay less interest overall because you pay off your mortgage much faster.

5/1 Adjustable Rate Mortgage

ARM 5/1 has an average of 2.99%, down 5 basis points from last week. For the first five years, you usually get a lower interest rate with a 5/1 adjustable rate mortgage compared to a 30 year fixed mortgage. But after this time, you can pay more, depending on the terms of your loan and how the rate changes with the market. For this reason, an adjustable rate mortgage can be a good option if you plan to sell or refinance your home prior to the rate change. Otherwise, changes in the market mean that your interest rate could be much higher after adjusting it.

Dynamics of mortgage rates

We use rates collected by Bankrate, owned by the same parent company as CNET, to track changes in these daily rates. This table shows the average rates offered by US lenders:

Average mortgage interest rates

Product Index Last week Change
30 year fixed 2.98% 3.04% -0.06
15 year fixed 2.33% 2.38% -0.05
30 year giant mortgage rate 2.80% 2.82% -0.02
30 year mortgage refinancing rate 2.96% 3.10% -0.14

Tariffs as of July 22, 2021.

How to shop at the best mortgage rate

For a personalized mortgage rate, talk to your local mortgage broker or use an online mortgage service. As you research mortgage rates, think about your goals and current finances. A number of factors, including your down payment, credit rating, loan-to-value ratio, and debt-to-income ratio, will affect your mortgage interest rate. A higher credit rating, higher down payment, lower DTI, lower LTV, or any combination of these factors can help you get a lower interest rate. The interest rate is not the only factor that affects the value of your home. Be sure to also consider other costs such as fees, closing costs, taxes and discounts. Make sure you talk to multiple lenders – like local and national banks, credit unions, and online lenders – and compare them to find the best mortgage for you.

What is the best loan term?

When choosing a mortgage, it is important to consider the loan term or payment schedule. The most common loan terms are 15 and 30 years, although mortgages also exist for 10, 20 and 40 years. Another important difference is between fixed and adjustable rate mortgages. For mortgages with a fixed interest rate, the interest rates are the same for the entire life of the loan. For adjustable rate mortgages, interest rates are the same for a certain number of years (usually five, seven or 10 years), then the rate fluctuates annually depending on the current interest rate in the market.

One factor to consider when choosing a fixed and variable rate mortgage is how long you plan to live in your home. If you are planning a long term living in a new home, a fixed rate mortgage may be the best option. While adjustable rate mortgages may have lower initial interest rates, fixed rate mortgages are more stable over time. However, if you don’t plan on keeping your new home for more than three to ten years, an adjustable rate mortgage can give you a better deal. As practice shows, there is no better loan term; it all depends on your goals and your current financial situation. When choosing a mortgage, it is important to do your research and think about what is most important to you.

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