Though 30-year fixed mortgage rates looked ready to surpass 5% earlier this week, they’ve retreated slightly in the past couple of days.
Rates have been increasing dramatically in recent months. They started the year at a weekly average of 3.22% and are now nearing 5%.
If you’re thinking about buying or refinancing right now, remember you don’t have to settle for the first lender that approves you. Comparing multiple offers can help you save money.
“While rates have risen, keep in mind that
still exists and that you should shop around to find the most competitive rates,” says Robert Heck, vice president of mortgage at Morty.
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Current mortgage rates
Current refinancing rates
Use our free mortgage calculator to see how today’s mortgage rates would impact your monthly payments. By plugging in different rates and term lengths, you’ll also understand how much you’ll pay over the entire length of your mortgage.
Your monthly estimated payment
- payment to 25% higher down payment would save you $8,916.08 on interest charges
- Lowering the interest rate by one% would save you $51,562.03
- Pay an additional $500 each month would reduce the loan length by 146 months
Click “More details” for tips on how to save money on your mortgage in the long run.
Is it better to rent or buy right now?
Whether you should rent or buy depends on current costs in your area and your lifestyle. In some areas of the country, it’s possible to get a mortgage with a monthly payment that’s lower than the average rent — but that’s not true everywhere, especially if you’re in a high-cost urban area.
If you’re worried about your rent continuing to increase, it might make sense to look into buying a home. While rents can go up year after year, if you have a fixed-rate mortgage, you know you’ll be paying the same amount every month for as long as you have your mortgage.
“No matter what you do next year, if you have a one year lease, the landlord has the ability to raise your rent even further,” DiBugnara says. “At the very least, if you lock in on an interest rate, you can stop that rise.”
How are mortgage rates determined?
In general, mortgage rates tend to be high when the US economy is thriving and low when it is struggling. Mortgage rates reached all time lows during the pandemic as the
eased monetary policy to boost the economy. But as the central bank works to fight inflation, rates have been increasing and have surpassed 4%.
Your mortgage rate will be influenced both by current rate trends and factors you can control. With a good credit score, low debt-to-income ratio, and substantial down payment, you can secure a better rate.
How do I find personalized mortgage rates?
Some mortgage lenders let you customize your mortgage rate on their websites by entering your down payment amount, zip code, and credit score. The resulting rate isn’t set in stone, but it can give you an idea of what you’ll pay.
If you’re ready to start shopping for homes, you may apply for preapproval with a lender. The lender does a hard credit pull and looks at the details of your finances to lock in a mortgage rate.
How do I compare mortgage rates between lenders?
You can apply for prequalification with multiple lenders. A lender takes a general look at your finances and gives you an estimate of the rate you’ll pay.
If you’re farther along in the homebuying process, you have the option to apply for preapproval with several lenders, not just one company. By receiving letters from more than one lender, you can compare personalized rates.
Applying for preapproval requires a hard credit pull. Try to apply with multiple lenders within a few weeks, because lumping all of your hard credit pulls into the same chunk of time will hurt your credit score less.