As July draws to a close, mortgage rates are down for fixed rate loans on July 30, 2021. If you are considering buying a home, check out today’s average rates for fixed rate mortgages and variable rate:
6 simple tips to get a 1.75% mortgage rate
Secure access to The Ascent’s free guide on how to get the lowest mortgage rate when buying your new home or refinancing. Rates are still at their lowest for decades, so act today to avoid missing out.
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30-year mortgage rates
The 30-year average mortgage rate today stands at 3.042%, down 0.004% from yesterday’s average of 3.046%. At today’s average rate, you would pay $ 424 per month in principal and interest for $ 100,000 borrowed. Over the life of the loan, your total interest charges would be $ 52,614 per $ 100,000 borrowed.
20-year mortgage rates
The 20-year average mortgage rate today stands at 2.776%, down 0.011% from yesterday’s average of 2.787%. At today’s average rate, the monthly principal and interest payment would be $ 543 per $ 100,000 of mortgage debt. You would have a total interest charge of $ 30,428 per $ 100,000 of mortgage debt over the term of the loan.
If you choose a shorter loan repayment term, like the 20-year mortgage instead of the 30-year mortgage, each monthly payment will be higher because you won’t be making as many payments. However, you will save a lot of money in interest over time, so this trade-off may be worth it.
15-year mortgage rates
The 15-year average mortgage rate today stands at 2.297%, down 0.022% from yesterday’s average of 2.319%. You would consider a principal and interest payment of $ 657 for every $ 100,000 borrowed at today’s average rate. For every $ 100,000 you borrow at today’s average rate, the total interest charge would be $ 18,310.
This loan has much higher monthly payments than the 20 or 30 year loan due to the very short repayment time. But you’ll own your free, paid-up home much sooner, and you’ll save a lot of interest over time if you choose the 15-year repayment plan.
The average 5/1 ARM rate is 3.079%, up 0.071% from yesterday’s average of 3.008%. You will only be guaranteed this rate for the first five years. It can adjust once a year after this date and there is a good chance that it will increase as rates are still very low at the moment. If your rate goes up, your monthly payments will also increase and your loan will become more expensive over time. Be sure to weigh these risks when you compare the ARM 5/1 to the 30 year fixed rate loan.
Should I lock in my mortgage rate now?
A mortgage rate freeze guarantees you a certain interest rate for a specified period of time – typically 30 days, but you may be able to guarantee your rate for up to 60 days. You will usually pay a fee to lock in your mortgage rate, but this way you are protected in the event of a rate hike before your mortgage closes.
If you plan to close your home within the next 30 days, it pays to lock in your mortgage rate based on today’s rates, especially since they are very competitive. But if your close is more than 30 days away, you might want to choose an adjustable rate lock instead for what will usually be a higher fee, but could save you money in the long run. A variable rate lock allows you to get a lower rate on your mortgage if rates drop before you close, and while rates today are still quite low, we don’t know if rates will go up or down. over the next few months. As such, it is beneficial to:
- LOCK if closing 7 days
- LOCK if closing 15 days
- LOCK if closing 30 days
- FLOAT if closing 45 days
- FLOAT if closing 60 days
To find out what rates are available to you, compare the rates of at least three of the top mortgage lenders before you lock in.