Today's Mortgage Rates - June 18, 2020

Now may be a good time to lock in a mortgage, and these are some options to choose from. 

Mortgage rates can fluctuate from week to week, and even from day to day, so it's important to keep tabs on where they stand. Rates have held fairly steady this week, with the 30-year fixed rate moving slightly upward and both the 15-year fixed rate and 5/1 ARM moving slightly downward. The 20-year fixed rate saw the largest one-week change with a 0.27% increase.

Data source: Zillow.

30-year mortgage rates

The average interest rate for a 30-year fixed mortgage is 3.50%. For a $200,000 mortgage, that means you're looking at a monthly payment of $1,457. Given that the average rate for a 30-year fixed loan was well over 4% back in March, now's a good time to lock in a long-term mortgage with a rate that won't change over time.

20-year mortgage rates

The average interest rate for a 20-year fixed mortgage is 3.49%, which is comparable to the 30-year fixed mortgage. For a $200,000 mortgage, that means you're looking at a monthly payment of $1,717 -- higher than the monthly payment with a 30-year loan, though you'll save money on interest by virtue of a shorter repayment period. The average rate for a 20-year fixed mortgage was also well over 4% back in March, so despite an increase over the past seven days, 3.49% is still competitive.

15-year mortgage rates

The average interest rate for a 15-year fixed mortgage is 2.87%, which is substantially lower than what you'll pay for a 30- or 20-year fixed loan. Back in March, the average rate for a 15-year fixed loan was upward of 3.5%, so now may be a good time to lock in a 15-year mortgage. For a $200,000 loan, you're looking at a monthly payment of $1,927, but you'll also pay less interest than you would for the same loan with a 20- or 30-year term.

5/1 ARMs

The average interest rate for a 5/1 ARM is 3.33%, which means that 3.33% rate is guaranteed for the first five years of your mortgage, but from there, your rate will adjust once per year. It may adjust upward, but it could also go down, depending on market conditions. The average rate for a 5/1 ARM is comparable to where it was three months ago, but it's come down since early June.

Should I lock in a mortgage right now?

A mortgage rate lock guarantees you a specific rate for a preset period of time -- usually 30 days, but sometimes you can lock in your rate for up to 60 days. You'll generally pay a fee for a mortgage rate lock, but in exchange, you're protected from fluctuations that could make your monthly loan payments costlier over time. 

If you like the rate you're seeing today and plan to close on your home within the next two to four weeks, then it could pay to lock in your rate. However, if your closing is more than two weeks away, you may want to choose a floating-rate lock instead for what will generally be a higher fee, but a potentially worthwhile one. A floating rate lock allows you to snag a lower rate on your mortgage if rates fall prior to your closing.

• 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

No matter what decision you make, be sure to shop around with different mortgage lenders to see what offers you qualify for. Each lender has its own set of borrowing requirements, so the rate you're presented with from one lender may differ from what another one is willing to give you.