Current Mortgage Rates -- October 15, 2020: Rates Fall Even Lower

Mortgage rates have dropped yet again. Is now the right time to lock in a home loan?

Mortgage rates are staying unbelievably low, with both the 30- and 20-year loan coming in at well under 3% and the 15-year loan at well under 2.5%. Here's what today's rates look like:

Data source: The Ascent's national mortgage interest rate tracking.

30-year mortgage rates

The average 30-year mortgage rate today is 2.894%, down 0.006% from yesterday. At today's rate, you'll pay principal and interest of $415.80 for every $100,000 you borrow. That doesn't include added expenses like property taxes and homeowners insurance premiums.

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 2.754%, down 0.027% from yesterday. At today's rate, you'll pay principal and interest of $542.66 for every $100,000 you borrow. Though your monthly payment will go up by $126.86 with a 20-year, $100,000 loan versus a 30-year loan of the same amount, you'll save $19,450.42 in interest over the course of your repayment period for every $100,000 you borrow.

15-year mortgage rates

The average 15-year mortgage rate today is 2.373%, down 0.005% from yesterday. At today's rate, you'll pay principal and interest of $660.97 for every $100,000 you borrow. Compared to the 30-year loan, your monthly payment will be $245.17 higher per $100,000 in mortgage principal. Your interest savings, however, will amount to $30,714.85 over the life of your repayment period per $100,000 of mortgage debt.

5/1 ARMs

The average 5/1 ARM rate is 3.531%, up 0.045% from yesterday. With a 5/1 ARM, you're guaranteed your initial interest rate for a five-year period, and from there, that rate can drop or climb once a year. A 5/1 ARM could save you money when you're able to snag a lower rate than what you'd get for a 30-year fixed loan, but since that's clearly not the case today, the 5/1 ARM makes little sense.

Should I lock my mortgage rate now?

A mortgage rate lock guarantees you a specific interest rate for a certain period of time -- usually 30 days, but 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 if rates climb between now and when you close on your home loan.

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 still quite low. 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

If you're ready to get a mortgage, be sure to shop around with different lenders to see what rates they have to offer. On top of rate quotes, find out what closing costs each lender wants to charge you, and don't be afraid to negotiate in that regard. Your goal should be to snag the best rate possible without incurring too many fees in the course of signing your mortgage, so the lower you're able to keep your closing costs, the better.