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Mortgage rates on Dec. 7 remain very competitive near record lows. Here's what you need to know about average rates today.
| Mortgage Type | Today's Interest Rate |
|---|---|
| 30-year fixed mortgage | 2.793% |
| 20-year fixed mortgage | 2.688% |
| 15-year fixed mortgage | 2.298% |
| 5/1 ARM | 3.707% |
30-year mortgage rates
The average 30-year mortgage rate today is 2.793%, up .004% from Friday's average of 2.789%. If you borrow at today's average rate, your monthly principal and interest payment would be $411 per $100,000 borrowed. During your entire loan repayment period, you'd pay total interest costs of $47,788 per $100,000 borrowed.
Check out The Ascent's mortgage calculator to see what your monthly payment might be and how much your loan will ultimately cost. Also learn how much money you'd save by snagging a lower interest rate, making a larger down payment, or choosing a shorter loan term.
20-year mortgage rates
The average 20-year mortgage rate today is 2.688%, down .031% from Friday's average of 2.719%. At today's average rate, you'd pay $539 per month in principal and interest per $100,000 borrowed. Over the life of the loan, your total interest costs would add up to $29,386 per $100,000 borrowed.
Although your total interest costs are well below what you'd pay for a 30-year loan, your monthly payments are higher. The interest savings comes from the fact you're paying off your loan a decade sooner -- but since you have so much less time to make payments, your monthly bill is larger.
15-year mortgage rates
The average 15-year mortgage rate today is 2.298%, down .005% from Friday's average of 2.303%. For each $100,000 borrowed at today's average rate, your monthly principal and interest payment would add up to $657. Your total interest costs over the life of the loan would equal $18,318 per $100,000 borrowed.
The 15-year loan comes with even lower total interest costs but even higher monthly payments than the 20-year mortgage. Again, you'll be debt-free a lot sooner, but have to pay more each month to achieve that goal.
5/1 ARMs
The average 5/1 ARM rate is 3.707%, up .061% from Friday's average of 3.646%. This is above the average interest rate on fixed-rate loans, and the starting rate is locked in only for a limited period of time -- in this case, for five years.
ARMs can make sense if you think that rates will go down over time or if you can qualify for a starting rate below what a fixed-rate mortgage would cost. Since neither of those things are likely true right now as rates are already near record lows and probably won't fall further five years from now, it doesn't make much sense to consider an ARM.
Should I lock my mortgage rate now?
A mortgage rate lock guarantees you a certain interest rate for a specified period of time -- usually 30 days, though you may be able to secure your rate for up to 60 days. You'll generally pay a fee to lock in your mortgage rate, but that way, you're protected in case rates climb between now and when you actually close on your mortgage.
If you plan to close on your home within the next 30 days, then it pays to lock in your mortgage rate based on today's rates -- especially since they're so competitive. But if your closing is more than 30 days away, you may want to choose a floating rate lock instead for what will usually be a higher fee, but one that could save you money in the long run. A floating rate lock lets you secure a lower rate on your mortgage if rates fall prior to your closing, and while today's rates are still quite low, we don't know if rates will go up or down over the next few months. As such, it pays to:
- LOCK if closing in 7 days
- LOCK if closing in 15 days
- LOCK if closing in 30 days
- FLOAT if closing in 45 days
- FLOAT if closing in 60 days
Before locking in, you should get rate quotes from at least three of the best mortgage lenders to ensure you're getting a loan at the most competitive possible rate.
