Today’s best mortgage and refinance rates: Thursday, September 10, 2020

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Mortgage rates and refinance rates have both fluctuated since this time last week and last month. But if you look at rates six months or a year ago, you can see a steady downward trend. If your finances are in order, then this could be a good time to get a mortgage or refinance your home.

The best mortgage rates Thursday, September 10, 2020

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

30-year fixed
2.86%
2.93%
2.88%

15-year fixed
2.37%
2.42%
2.44%

5/1 ARM
3.11%
2.93%
2.90%

Rates from the Federal Reserve Bank of St. Louis.

The 30-year and 15-year fixed rates have decreased since last Thursday and since this time last month. The 5/1 ARM rates have been steadily increasing, and the average 5/1 ARM rate is now above 3.00%.

Rates have remained low overall, though. The trending decline becomes more obvious 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%
3.29%
3.49%

15-year fixed
2.37%
2.79%
3.00%

5/1 ARM
3.11%
3.18%
3.30%

Rates from the Federal Reserve Bank of St. Louis.

Although 5/1 ARM rates have been increasing in recent weeks, they’re still lower than they were earlier in 2020 and in 2019.

Several factors affect mortgage rates. Rates typically decrease in response to a struggling economy. As the coronavirus pandemic and economic crisis continue, you’ll likely see rates stay low, and they could keep going down.

The best refinance rates Thursday, September 10, 2020

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

30-year fixed
3.10%
3.09%
3.13%

15-year fixed
2.53%
2.56%
2.66%

10-year fixed
2.61%
2.61%
2.67%

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Rates from Bankrate.

The 30-year fixed refinance rate has increased by one basis point since last Thursday, and the 15-year fixed rate has decreased by a few basis points. The 10-year fixed rate has remained steady. Rates have decreased across the board since this time last month.

How do 30-year fixed rates work?

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.

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 because a) the rate is higher, and b) your interest is also spread out over a longer period of time.

How do 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 do 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 do 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.

With a 5/1 ARM, …read more

Source:: Business Insider

      

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