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Mortgage rates rose again this week. According to Freddie Mac, the national average 30-year fixed mortgage rate is up 12 basis points to 6.44%, and the 15-year fixed rate increased by 22 basis points to 5.63%. These inclines suggest that homeowners looking to refinance may want to wait until next year, when rates are expected to go down.
However, if you’re considering buying a house, now might be a better time than you’d think. The year-over-year 30-year mortgage rate is actually down by 1.19%, and it’s 38 basis points below the 52-week average. Meanwhile, the 15-year rate is 1.29% lower than last October and 45 basis points under its 52-week average.
Dig deeper: Should you buy a house? How to know you’re ready.
Here are the current mortgage rates, according to the latest Zillow data:
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30-year fixed: 6.19%
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20-year fixed: 6.03%
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15-year fixed: 5.53%
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5/1 ARM: 6.78%
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7/1 ARM: 6.90%
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30-year VA: 5.55%
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15-year VA: 5.08%
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5/1 VA: 5.79%
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5/1 FHA: 4.85%
Remember, these are the national averages and rounded to the nearest hundredth.
Learn more: 5 strategies to get the lowest mortgage rates
These are today’s mortgage refinance rates, according to the latest Zillow data:
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30-year fixed: 6.31%
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20-year fixed: 6.28%
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15-year fixed: 5.67%
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5/1 ARM: 6.58%
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7/1 ARM: 6.49%
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30-year VA: 5.59%
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15-year VA: 5.23%
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5/1 VA: 5.06%
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30-year FHA: 5.43%
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15-year FHA: 5.27%
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5/1 FHA: 4.84%
Again, the numbers provided are national averages rounded to the nearest hundredth. Mortgage refinance rates are often higher than rates when you buy a house, although that’s not always the case.
Learn more: Want to refinance your mortgage? Here are 7 home refinance options.
Yahoo Finance has a free mortgage payment calculator. Use the calculator to see how various mortgage rates and loan terms could affect your monthly payments.
Our calculator also considers homeowners insurance, property taxes, and other expenses that affect your monthly payment. This will give you a better idea of what you’d realistically pay in a month than if you just look at the mortgage principal and interest.
A mortgage interest rate is a fee for borrowing money from your lender, expressed as a percentage. You can choose from two types of rates: fixed or adjustable.
A fixed-rate mortgage locks in your rate for the entire life of your loan. For example, if you get a 30-year mortgage with a 6% interest rate, your rate will stay at 6% for the entire 30 years unless you refinance or sell.
An adjustable-rate mortgage locks in your rate for a predetermined amount of time and then changes it periodically. Let’s say you get a 7/1 ARM with an introductory rate of 6%. Your rate would be 6% for the first seven years, then the rate would increase or decrease once per year for the last 23 years of your term. Whether your rate goes up or down depends on several factors, such as the economy and housing market.
At the beginning of your mortgage term, most of your monthly payment goes toward interest. Your monthly payment toward mortgage principal and interest stays the same throughout the years — however, less and less of your payment goes toward interest, and more goes toward the mortgage principal or the amount you originally borrowed.
Learn more: Adjustable-rate vs. fixed-rate mortgages
A 30-year fixed-rate mortgage is a good choice if you want a lower mortgage payment and the predictability that comes with having a fixed rate. Just know that your rate will be higher than if you choose a shorter term and will result in paying significantly more in interest over the years.
You might like a 15-year fixed-rate mortgage if you want to pay off your home loan quickly and save money on interest. These shorter terms come with lower interest rates, and since you’re cutting your repayment time in half, you’ll save a lot in interest in the long run. But you’ll need to be sure you can comfortably afford the higher monthly payments that come with 15-year terms.
Read more: How to decide between a 15-year and 30-year fixed-rate mortgage
Typically, an adjustable-rate mortgage could be good if you plan to sell before the introductory rate period ends. Adjustable rates usually start lower than fixed rates, then your rate will change after a predetermined amount of time. However, 5/1 and 7/1 ARM rates are very similar to 30-year fixed rates right now. Before getting an ARM just for a lower rate, compare your rate options from term to term and lender to lender.
Yes and no. Mortgage rates have decreased significantly over the past year. However, they have been increasing over the last few weeks. It’s also unlikely that rates will drop significantly before the end of 2024.
Mortgage rates will likely go down throughout 2025, though. So, if you want to buy a house in 2024, now is as good a time as any. But if you aren’t in any rush, you may want to hold out until 2025. Next year is also probably a better time to refinance since rates are expected to decline.
Dig deeper: When will mortgage rates go down?
According to Freddie Mac, today’s national average 30-year mortgage rate has increased by 12 basis points to 6.44%, and the average 15-year mortgage rate is up 22 basis points to 5.63%. Both rates have dropped drastically since October 2023, though.
Economists at Fannie Mae and the Mortgage Bankers Association currently expect 30-year fixed mortgage rates to end the year at 6.2%.
It’s actually likely that mortgage rates will get lower in 2025, not higher. The Federal Reserve will probably slash the federal funds rate several times next year, which will help push mortgage rates down.