Current Mortgage Rates -- October 16, 2020: Rates Remain Really Low

Mortgage rates remain competitive. Should you lock in today?

Mortgage rates are holding steady at unbelievable lows, with both the 30- and 20-year loan coming in at well under 3% and the 15-year loan at well under 2.5%. This is 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 2.887%, down 0.007% 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 2.755%, up 0.001% 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 2.390%, up 0.017% from yesterday. At today's rate, you'll pay principal and interest of $661.53 for every $100,000 you borrow. Compared to the 30-year loan, your monthly payment will be $245.73 higher per $100,000 in mortgage principal. Your interest savings, however, will amount to $30,613.63 over the life of your repayment period per $100,000 of mortgage debt.

5/1 ARMs

The average 5/1 ARM rate is 3.398%, down 0.133% from yesterday. With a 5/1 ARM, you're only guaranteed your initial interest rate for a five-year period. From that point on, your rate could increase once a year as it adjusts. Now to be fair, your rate can also go down, but generally speaking, it's not worth taking that chance if you can't snag a discount on your rate up front. And since the 30-year fixed loan has a much lower interest rate than the 5/1 ARM right now, the former makes more 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 very 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 apply for a mortgage, don't just accept the first offer you're presented with. Rather, gather offers from different lenders so you can compare your choices and make the right call. Each lender sets its own fees and standards, so your credit score might buy you a lower rate with one lender than another. Spending the time to assess different offers could save you lots of money both at closing and in the long run.