by Christy Bieber | Published on Sept. 22, 2021
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Buying a home? Here's how average mortgage rates are trending today.
On Sept. 22, 2021, average mortgage rates are up again for the 15-year and 30-year fixed-rate loans and down for the 20-year fixed loan and 5/1 ARM. The interest rate charged on a mortgage determines the cost to borrow and ultimately plays a key role in determining how much a home costs over time.
Here's what you need to know about average mortgage rates today:
|Mortgage Type||Today's Interest Rate|
|30-year fixed mortgage||3.086%|
|20-year fixed mortgage||2.717%|
|15-year fixed mortgage||2.342%|
Secure access to The Ascent's free guide that reveals how to get the lowest mortgage rate for your new home purchase or when refinancing. Rates are still at multi-decade lows so take action today to avoid missing out.
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The average 30-year mortgage rate today is 3.086%, up 0.003% from yesterday's average of 3.083%. A mortgage loan at today's average interest rate would cost you $426 per $100,000 borrowed. Total interest costs would be $53,452 per $100,000 in mortgage debt over the life of the loan.
The average 20-year mortgage rate today is 2.717%, down 0.016% from yesterday's average of 2.733%. If you borrow at today's average rate, you'd have a monthly principal and interest payment of $541 per $100,000 borrowed. Over the life of the loan, total interest costs would be $29,729 per $100,000 in mortgage debt.
A 20-year loan would reduce total costs over time compared with a 30-year loan because you won't pay interest for as long of a time. However, you will have higher monthly payments with a shortened repayment term since you don't make as many of them.
The average 15-year mortgage rate today is 2.342%, up 0.004% from yesterday's average of 2.338%. You'd be looking at a principal and interest payment of $659 per $100,000 borrowed at today's average rate. For each $100,000 you borrow at today's average rate, total interest costs would add up to $18,688.
Both a low interest rate and a short repayment time make this loan very affordable over the life of the loan. However, despite the low rate, the time to pay off the loan is so short that each monthly payment must be considerably higher.
The average 5/1 ARM rate is 3.012%, down 0.129% from yesterday's average of 3.141%. Unlike the other loan options, the interest rate on this one is not fixed -- it's adjustable. After five years, it could adjust up and that would make monthly payments and total loan costs more expensive. Be aware of these risks before choosing an ARM.
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:
To find out what rates are available to you, compare rates from at least three of the best mortgage lenders before locking in.
Chances are, interest rates won't stay put at multi-decade lows for much longer. That's why taking action today is crucial, whether you're wanting to refinance and cut your mortgage payment or you're ready to pull the trigger on a new home purchase.
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