Today's Mortgage Rates -- January 18, 2021: Rates Continue Their Upward Trend

Rates are up again on Jan. 18. Is now a good time to get a home loan?

As we move into the second half of January, mortgage rates continue their trend of moving slightly upward. Here's what you need to know about average mortgage interest rates today.

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

30-year mortgage rates

The average 30-year mortgage rate today is 2.859%, up 0.002% from Friday's average of 2.857%. For each $100,000 borrowed at today's average rate, your monthly principal and interest payment would add up to $414. Over the life of the loan, your total interest costs would add up to $49,054 per $100,000 borrowed.

20-year mortgage rates

The average 20-year mortgage rate today is 2.655%, up 0.004% from Friday's average of 2.651%. Borrowing at today's average rate would leave you with a monthly principal and interest payment of $537 per $100,000 in mortgage debt. During your entire loan repayment period, you'd pay total interest costs of $28,997 per $100,000 borrowed.

It may seem surprising that your monthly payment is so much higher than on the 30-year loan, but this is understandable. Since you'll be making 120 fewer payments by cutting 10 years off your repayment timeline, each payment must be higher. Of course, your interest savings is considerable because you'll save a decade's worth of interest charges.

15-year mortgage rates

The average 15-year mortgage rate today is 2.278%, up 0.011% from Friday's average of 2.267%. At today's average rate, you'd pay $656 per month in principal and interest per $100,000 borrowed. The total costs of interest would add up to $18,150 per $100,000 borrowed at today's average rate.

When you choose a 15-year loan, you're further reducing the number of payments compared with the 20-year fixed-rate loan. And you're also shortening the time you'll have to pay interest. That's why your total interest savings is so substantial, but your monthly payments are so much higher.

5/1 ARMs

The average 5/1 ARM rate is 3.272%, up 0.003% from Friday's average of 3.269%. With this adjustable-rate mortgage, your starting rate is only guaranteed for five years. It can go up or down after that. But since rates are near record lows right now, chances are good it will go up. Since your starting rate would already be considerably higher than on fixed-rate loans, there's no reason to take out an ARM and hope rates don't rise when they begin adjusting.

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.