Today's Mortgage Rates -- August 4, 2021: Rates Fall

by Christy Bieber | Published on Aug. 4, 2021

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Hollow model home on top of stacks of cash with Today's Mortgage Rates graphic.

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Is now a good time to get a mortgage?

On Aug. 4, 2021, mortgage rates are down for all loans. Homeowners should compare offers from different mortgage lenders to find the best rate they can qualify for based on their financial credentials. But it's a good idea to know average rates to see how they compare to what lenders offer you.

Check out average mortgage rates for today:

Mortgage Type Today's Interest Rate
30-year fixed mortgage 3.007%
20-year fixed mortgage 2.735%
15-year fixed mortgage 2.273%
5/1 ARM 2.907%

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

30-year mortgage rates

The average 30-year mortgage rate today is 3.007%, down 0.017% from yesterday's average of 3.024%. Borrowing at today's average rate would leave you with a monthly principal and interest payment of $422 per $100,000 in mortgage debt. Total interest costs would add up to $51,913 per $100,000 borrowed over the life of the loan.

20-year mortgage rates

The average 20-year mortgage rate today is 2.735%, down 0.05% from yesterday's average of 2.785%. At today's average rate, the monthly principal and interest payment would add up to $541 per $100,000 in mortgage debt. Total interest costs would add up to $29,942 per $100,000 borrowed over the life of the loan.

This loan is cheaper over time than the 30-year option, but more expensive each month. If you reduce your payoff time, each payment is higher but total costs are lower since you don't pay interest for as long.

15-year mortgage rates

The average 15-year mortgage rate today is 2.273%, down 0.012% from yesterday's average of 2.285%. For each $100,000 borrowed at today's average rate, your total monthly principal and interest payment would be $656. Your total interest costs over the life of the loan would equal $18,108 per $100,000 borrowed.

If you can afford the high monthly payments, the 15-year loan option saves you a lot of money over time compared with the 30-year and 20-year loans. You'll also own your home free and clear much sooner with this loan, which gives you more financial flexibility in the future.

5/1 ARMs

The average 5/1 ARM rate is 2.907%, down 0.241% from yesterday's average of 3.148%. The interest rate your loan starts at is guaranteed only for five years. Your rate could go up after that time, as often as once annually. If it does, your monthly payments and interest costs over the remaining time will move higher. Think about whether this risk is worth it.

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, 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 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

To find out what rates are available to you, compare rates from at least three of the best mortgage lenders before locking in.

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