Today’s Mortgage Rates Move Below 3.9% | January 13, 2022

The average interest rate on a 30-year fixed-rate mortgage is 3.872% today, 0.102 percentage points less than yesterday. The 30-year refi rate is also lower. The rate averages 4.026%, a decrease of 0.091 percentage points.

Today’s decline breaks a four-day uptrend. Lower interest rates are welcome news for well-qualified borrowers either looking for a new mortgage or refinancing an existing loan.

  • The most recent interest rate on a 30-year fixed-rate mortgage is 3.872%. ⇓.
  • The most recent interest rate on a 15-year fixed-rate mortgage is 2.863%. ⇓.
  • The latest rate on a 5/1 ARM is 2.442%. ⇓.
  • The latest rate on a 7/1 ARM is 3.788% ⇓
  • The latest rate on a 10/1 ARM is 4.028%. ⇓.

Money’s daily mortgage rates reflect what a borrower with a 20% down payment and a credit score of 700 – roughly the national average – could pay if he or she applies for a home loan now. Daily rates are based on the average price that 8,000 lenders offered applicants on the previous business day. Freddie Mac’s weekly interest rates will generally be lower as they measure the interest rates offered to borrowers with higher creditworthiness.

Today’s 30 year fixed rate mortgage

  • The 30-year rate is 3.872%.
  • This is a day fromwrinkle of 0.102 percentage points.
  • That’s a month increase of 0.259 percentage points.

The 30-year fixed-rate mortgage is the most widely used form of home loan in the United States. Its popularity is due to its long payback period, which results in lower monthly payments. Borrowers also appreciate the predictable interest rate and monthly payments of a fixed rate loan. Even if the payments are lower than a shorter loan, over time you will actually pay more because the interest rate is higher.

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Average mortgage rates

Data based on U.S. mortgage loans completed on January 12, 2022

Credit type January 12th Last week change
15 years firmly conventional 2.86% 2.66% 0.2%
Firmly conventional for 30 years 3.87% 3.74% 0.13%
7/1 ARM rate 3.79% 3.39% 0.4%
10/1 ARM rate 4.03% 3.73% 0.3%

Your actual price may differ

15 years today fixed rate Mortgage rates

  • The 15-year rate is 2.863%.
  • This is a day fromwrinkle of 0.056 percentage points.
  • That’s a month inwrinkle of 0.263 percentage points.

The interest rate on a 15 year fixed rate loan is lower than the interest rate on a longer term loan of the same amount, so you end up paying less interest. However, the short payback period means the monthly payments are higher and may not fit your budget.

The current interest rates for adjustable rate mortgages

  • The latest rate on a 5/1 ARM is 2.442%. ⇓.
  • The latest rate on a 7/1 ARM is 3.788%. ⇓.
  • The latest rate on a 10/1 ARM is 4.028%. ⇓.

The adjustable rate mortgages start with a low introductory interest rate that is fixed over time. At some point, however, the rate becomes variable and can be reset to a higher level. For example, the interest rate on a 5/1 ARM is set for five years before resetting annually. A floating rate loan can be a good option if you don’t plan on keeping the home beyond the fixed rate period.

The latest VA, FHA, and jumbo loan rates

The average interest rates on FHA, VA, and Jumbo loans are:

  • The interest rate on a 30 year FHA mortgage is 3.667%. ⇓.
  • The interest rate on a 30 year VA mortgage is 3.724%. ⇓.
  • The interest rate on a 30 year jumbo mortgage is 3.555%. ⇓.

The latest mortgage refinancing rates

The average refinancing rates for 30 year loans, 15 year loans, and ARMs are:

  • The refinancing rate for a 30-year fixed-rate refinancing is 4.026%. ⇓.
  • The refinancing rate for a 15-year fixed-rate refinancing is 3.004%. ⇓.
  • The refinancing rate for a 5/1 ARM is 2.737%. ⇓.
  • The refinancing rate for a 7/1 ARM is 3.93%. ⇓.
  • The refinancing rate for a 10/1 ARM is 4.174%. ⇓.
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Average mortgage refinancing rates

Data based on U.S. mortgage loans completed on January 12, 2022

Credit type January 12th Last week change
15 years firmly conventional 3.0% 2.77% 0.23%
Firmly conventional for 30 years 4.03% 3.87% 0.16%
7/1 ARM rate 3.93% 3.89% 0.04%
10/1 ARM rate 4.17% 4.11% 0.06%

Your actual price may differ

Where are mortgage rates going this year?

Mortgage rates fell by 2020. Millions of homeowners responded to the low mortgage rates by refinancing existing loans and taking out new ones. Many people bought houses that they might not have been able to afford at higher prices. In January 2021, interest rates fell briefly to their lowest level since records began, but trended slightly higher as the year progressed.

Looking ahead, experts assume that interest rates will continue to rise in 2022, but also modestly. Factors that could affect rates include continued economic improvement and further increases in the labor market. The Federal Reserve has also begun cutting its purchases of mortgage-backed securities, announcing it will raise the key rate three times in 2022 to combat rising inflation.

While mortgage rates are likely to rise, experts say it won’t happen overnight and it won’t be a dramatic jump. Interest rates should stay near historically low levels in the first half of the year and rise slightly later in the year. Even when interest rates rise, it’s still a good time to buy a new home or refinance a mortgage.

Some of the factors that affect mortgage rates include:

  • The Federal Reserve. When the pandemic hit the United States in March 2020, the Fed took swift action. The Fed announced plans to keep money flowing through the economy by lowering the short-term federal fund interest rate to 0% to 0.25%, which is as low as they go. The central bank also promised to buy mortgage-backed securities and government bonds to prop up the home finance market, but began tapering those purchases in November.
  • The 10-year treasury note. Mortgage rates move in step with the yields on the government’s 10-year government bond. Yields fell below 1% for the first time in March 2020 and have been rising since then. On average, there is typically a 1.8 point spread between Treasury yields and benchmark mortgage rates.
  • The wider economy. Unemployment rates and changes in gross domestic product are important indicators of the overall health of the economy. Low employment and GDP growth means the economy is weak, which can drive interest rates down. Thanks to the pandemic, unemployment hit an all-time high early last year and has not yet recovered. GDP also fell, and although it has recovered somewhat, there is still plenty of room for improvement.

Tips for the lowest possible mortgage rate

There is no one universal mortgage rate that all borrowers get. Qualifying for the lowest mortgage rates takes a bit of work and depends on both personal financial factors and market conditions.

Check your credit history and credit report. Mistakes or other red flags can drag your creditworthiness down. Borrowers with the highest creditworthiness get the best interest rates. Hence, it is important to check your credit report before you start looking for a home. Taking steps to correct bugs can increase your score. If you have a high credit card balance, paying off can be a quick boost too.

Save money on a substantial down payment. This will lower your loan-to-value ratio, ie how much of the house price the lender has to finance. A lower LTV usually means a lower mortgage rate. Lenders also want to see money that has been stored in an account for at least 60 days. It tells the lender that you have the money to finance the home purchase.

Shop around for the best price. Don’t be satisfied with the first rate a lender offers you. Check with at least three different lenders to see who offers the lowest interest rates. In addition to traditional banks, consider different types of lenders, such as credit unions and online lenders.

Likewise. Take the time to read up on the different types of credit. While the 30 year fixed rate mortgage is the most common mortgage, you should consider a shorter term loan such as a 15 year loan or an adjustable rate mortgage. These types of loans often come with a lower interest rate than a traditional 30 year mortgage. Compare the cost of each to see which one best fits your needs and financial situation. Government loans – such as those supported by the Federal Housing Authority, the Department of Veterans Affairs, and the Department of Agriculture – can be cheaper options for those who qualify.

Finally, secure your tariff. By setting your interest rate once you find the right interest rate, loan product, and lender, you can make sure your mortgage rate doesn’t go up before you take out the loan.

Our mortgage rate method

Money Daily Mortgage Rate shows the average rate offered by over 8,000 lenders in the United States for whom the latest daily business rates are available. Today we show the interest rates for Wednesday January 12th, 2022. Our interest rates reflect what a typical borrower with a creditworthiness of 700 could currently expect to pay for a home loan. These prices were offered to people off 20% and include discount points.

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