Today’s best mortgage and refinance rates: Monday, September 14, 2020

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Fixed mortgage rates have been steadily decreasing, while adjustable rates have increased in recent weeks. Refinance rates have gone down across the board since this time last week and last month.

The best mortgage rates Monday, September 14, 2020

Mortgage type
Average rate today
Average rate last week
Average rate last month

30-year fixed
2.86%
2.93%
2.96%

15-year fixed
2.37%
2.42%
2.46%

5/1 ARM
3.11%
2.93%
2.90%

Rates from the Federal Reserve Bank of St. Louis.

The 30-year and 15-year mortgage rates have been gradually decreasing over the past few weeks. The 5/1 adjustable rates have been steadily increasing.

Mortgage rates are still low overall. You can see the trending decline when you look at rates from 6 months or a year ago:

Mortgage type
Average rate today
Average rate 6 months ago
Average rate 1 year ago

30-year fixed
2.86%
3.36%
3.56%

15-year fixed
2.37%
2.77%
3.09%

5/1 ARM
3.11%
3.01%
3.36%

Rates from the Federal Reserve Bank of St. Louis.

The 5/1 ARM rates have been going up. But if you get a 5/1 ARM now, you’ll likely snag a lower rate than you would have in 2019.

Several factors affect mortgage rates. Decreasing rates are usually a sign of a struggling economy. As the coronavirus pandemic and economic crisis continue, rates will likely stay relatively low.

The best refinance rates Monday, September 14, 2020

Mortgage type
Average rate today
Average rate last week
Average rate last month

30-year fixed
3.10%
3.11%
3.41%

15-year fixed
2.54%
2.53%
2.81%

10-year fixed
2.61%
2.60%
2.88%

Rates from Bankrate.

The 30-year, 15-year, and 10-year fixed refinance rates have all fluctuated a little since last Monday. But refinance rates are down across the board since this time last month.

How 30-year fixed rates work

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Typically, you’ll pay a higher rate on a 30-year fixed-rate mortgage than on a 15-year fixed or 5/1 adjustable mortgage. But 5/1 ARM rates are higher than 30-year fixed rates right now, so getting a 30-year fixed rate is especially affordable.

Your monthly payments will be lower compared to the other types of loans, because your principal is spread out over a longer period of time.

The downside is that you’ll pay more in interest than you would with a 15-year fixed term because a) the rate is higher, and b) your interest is also spread out over a longer period of time.

How 15-year fixed rates work

A 15-year fixed rate is lower than what you’ll pay for a 30-year mortgage. Monthly payments will likely be higher, because you’re paying off the principal in half the time.

You’ll save money in the long run, though, because the rate is lower, and you’ll be making payments for a shorter amount of time.

How 10-year fixed rates work

A 10-year fixed-rate mortgage isn’t very common for an initial mortgage. But you might refinance into a 10-year mortgage after you’ve paid down some of your loan.

Rates are similar to what you’ll pay for a 15-year fixed-rate mortgage, but you’ll pay off your loan faster.

How 5/1 ARMs work

A 5/1 adjustable rate is typically lower than the 30-year fixed rate but higher than the 15-year fixed rate. But 5/1 ARM rates have been increasing, so it could be a better deal to get a fixed rate right now. 

If you’re considering an ARM, then …read more

Source:: Business Insider

      

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