For anyone in the market to buy or refinance a home, it’s a good time to lock in a low rate. Mortgage rates fell today and remain at historical lows.
The average rate on a 30-year fixed mortgage is 3.06%, according to Bankrate.com. On a 15-year fixed mortgage, the average rate is 2.40%. The average rate on a 30-year jumbo mortgage is 3.03%, and the average rate on a 5/1 ARM is 2.82%.
Loan Term Rate Change Rate Last Week
30-year fixed 3.06% -0.05% 3.11%
15-year fixed 2.40% -0.01% 2.41%
30-year jumbo 3.03% -0.04% 3.07%
5/1 ARM 2.82% 0.00% 2.86%
30-year Fixed-rate Mortgages
The average rate for the benchmark 30-year fixed-rate mortgage fell to 3.06%. Last week, the 30-year fixed was 3.11%. Today’s rate is lower than the 52-week high of 3.37%.
The APR on a 30-year fixed is 3.28%. This time last week, it was 3.30%. APR is the all-in cost of your loan.
At today’s interest rate of 3.06%, borrowers with a 30-year fixed-rate mortgage of $100,000 will pay 425 per month in principal and interest (taxes and fees not included), the Forbes Advisor mortgage calculator shows. In total interest, you’d pay $52,945 over the life of the loan.
15-year Fixed-rate Mortgages
The average interest rate on the 15-year fixed mortgage sits at 2.40%. This same time last week, the 15-year fixed-rate mortgage was at 2.41%. Today’s rate is higher than the 52-week low of 2.32%.
The APR on a 15-year fixed is 2.69%. This time last week, it was 2.70%.
With an interest rate of 2.40%, you would pay 662 per month in principal and interest for every $100,000 borrowed. Over the life of the loan, you would pay $19,177 in total interest.
The average interest rate on the 30-year fixed-rate jumbo mortgage sits at 3.03%. Last week, the average rate was 3.07%. The 30-year fixed rate on a jumbo mortgage is currently higher than the 52-week low of 2.85%.
Borrowers with a 30-year fixed-rate jumbo mortgage with today’s interest rate of 3.03% will pay 423 per month in principal and interest per $100,000. That means that on a $750,000 loan, the monthly principal and interest payment would be around 3,174, and you’d pay roughly $392,704 in total interest over the life of the loan.
The average interest rate on a 5/1 ARM sits at 2.82%, higher than the 52-week low of 2.85%. Last week, the average rate was 2.86%.
Borrowers with a 5/1 ARM of $100,000 with today’s interest rate of 2.82% will pay 412 per month in principal and interest.
Calculating Mortgage Payments
For much of the population, buying a home means working with a mortgage lender to get a mortgage. It can be challenging to figure out how much you can afford and what you’re paying for.
You can use a mortgage calculator to estimate your monthly mortgage payment based on factors including your interest rate, purchase price and down payment.
Here’s what you’ll need in order to calculate your monthly mortgage payment:
The home price
Your down payment amount
The interest rate
The loan term
Any taxes, insurance and any HOA fees
What you can afford depends on a number of factors, including your income, debt, debt-to-income ratio, down payment and credit score.
You also want to consider closing costs, property taxes, insurance costs and ongoing maintenance expenses.
The type of loan you choose can also affect how much house you can afford. When shopping for a loan, think about whether a conventional mortgage, FHA loan, VA loan or USDA loan is best for your particular situation.
What’s an APR and Why Is It Important?
APR, or annual percentage rate, is a calculation that includes both a loan’s interest rate and a loan’s finance charges, expressed as an annual cost over the life of the loan. In other words, it’s the total cost of credit. APR accounts for interest, fees and time.
Since APR includes both the interest rate and certain fees associated with a home loan, APR can help you understand the total cost of a mortgage if you keep it for the entire term. The APR will usually be higher than the interest rate, but there are exceptions.