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Mortgage Rates Are Lower Today | September 13, 2021

- Money; Getty Images
Money; Getty Images

The interest rate on a 30-year fixed-rate mortgage is 3.235% today, 0.019 percentage points lower than on Friday. Rates for more home purchase loans are starting this week lower, with the exceptions being the 7/1 and 10/1 adjustable-rate mortgages.

Rates for mortgage refinance are also lower, with the rate on a 30-year refi averaging 3.365%. The sole exception is the 10/1 ARM, which increased by 0.101 percentage points.

Money's daily mortgage rates reflect what a borrower with a 20% down payment and a 700 credit score — roughly the national average score — might pay if he or she applied for a home loan right now. Each day's rates are based on the average rate 8,000 lenders offered to applicants the previous business day. Freddie Mac's weekly rates will generally be lower, since they measure rates offered to borrowers with higher credit scores.

Current mortgage rates: 30-year fixed-rate mortgage rates

A fixed-rate mortgage will have a fixed interest rate and steady monthly payments for as long as you keep the loan. Fixed-rate mortgages come in a number of different lengths, but the 30-year mortgage is the go-to loan for most borrowers because its long payback time results in lower monthly payments. A disadvantage of a 30-year loan is that the interest rate is typically higher than the rate on shorter-term loans, so you'll pay more for the loan in the form of interest.

Current mortgage rates: 15-year fixed-rate mortgage rates

A 15-year fixed-rate loan will be paid off in half the time of a 30-year mortgage, which means getting out of debt soon. However, the shorter payback time means the monthly payments will be higher. The interest rate on this shorter-term loan tends to be lower than on a 30-year, however, which means you won't pay as much interest and will save money in the long run.

Current mortgage rates: 5/1 jumbo adjustable-rate mortgage rates

An alternative option is an adjustable-rate mortgage. If you take out this type of loan, your introductory rate will be low and fixed for a period of time. Eventually the interest rate will become variable, adjusting to market conditions on a regular basis. The monthly payments will be fixed at first and then change along with the rate.

ARMs are available in a number of different terms. If you opt for a 5/1 adjustable-rate mortgage, the interest rate will be fixed for five years, then reset yearly until the loan is paid off. Other common terms include 7/1 ARMs and a 10/1 ARMs.

Current mortgage rates: VA, FHA and jumbo loan rates

The average rates for FHA, VA and jumbo loans are:

Current mortgage refinance rates

The average rates for 30-year loans, 15- year loans and 5/1 jumbo ARMs are:

Where are mortgage rates heading this year?

Mortgage rates sunk through 2020. Millions of homeowners responded to low mortgage rates by refinancing existing loans and taking out new ones. Many people bought homes they may not have been able to afford if rates were higher.

In January 2021, rates briefly dropped to the lowest levels on record, but trended higher through the month and into February.

Looking ahead, experts believe interest rates will rise more in 2021, but modestly. Factors that could influence rates include how quickly the COVID-19 vaccines are distributed and when lawmakers can agree on another economic relief package. More vaccinations and stimulus from the government could lead to improved economic conditions, which would boost rates.

While mortgage rates are likely to rise this year, experts say the increase won’t happen overnight and it won’t be a dramatic jump. Rates should stay near historically low levels through the first half of the year, rising slightly later in the year. Even with rising rates, it will still be a favorable time to finance a new home or refinance a mortgage.

Factors that influence mortgage rates include:

Tips for getting the lowest mortgage rate possible

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

Check your credit score and credit report. Errors or other red flags that may be dragging your credit score down. Borrowers with the highest credit scores are the ones who will get the best rates, so checking your credit report before you start the house-hunting process is key. Taking steps to fix errors will help you raise your score. If you have high credit card balances, paying them down can also provide a quick boost.

Save up money for a sizeable down payment. This will lower your loan-to-value ratio, which means how much of the home’s price the lender has to finance. A lower LTV usually translates to a lower mortgage rate. Lenders also like to see money that has been saved in an account for at least 60 days. It tells the lender you have the money to finance the home purchase.

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

Also take time to find out about different loan types. While the 30-year fixed-rate mortgage is the most common type of mortgage, consider a shorter-term loan like a 15-year loan or an adjustable-rate mortgage. These types of loans often come with a lower rate than a conventional 30-year mortgage. Compare the costs of all to see which one best fits your needs and financial situation. Government loans — such as those backed by the Federal Housing Authority, the Department of Veterans Affairs and the Department of Agriculture — can be more affordable options for those who qualify.

Finally, lock in your rate. Locking your rate once you’ve found the right rate, loan product and lender will help guarantee your mortgage rate won’t increase before you close on the loan.

Our mortgage rate methodology

Money’s daily mortgage rates show the average rate offered by over 8,000 lenders across the United States the most recent business day rates are available for. Today, we are showing rates for Friday, September 10, 2021. Our rates reflect what a typical borrower with a 700 credit score might expect to pay for a home loan right now. These rates were offered to people putting 20% down and include discount points.

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