Mortgage rates are on the rise for all loans today. Homeowners need to monitor changes in mortgage rates over time so that they can make a strategic choice about the best time to apply for a home loan.
Check out today’s average rates to see what a typical buyer would pay for a loan on August 11, 2021:
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30-year mortgage rates
The 30-year average mortgage rate today stands at 3.063%, up 0.028% from yesterday’s average of 3.035%. A loan at today’s mid-rate would have a monthly principal and interest payment of $ 425 per $ 100,000 borrowed. You would have a total interest charge of $ 53,003 per $ 100,000 of mortgage debt over the term of the loan.
20-year mortgage rates
The 20-year average mortgage rate today stands at 2.799%, up 0.018% from yesterday’s average of 2.781%. You would consider a principal and interest payment of $ 545 per $ 100,000 borrowed at today’s average rate. The total interest charge would be $ 30,702 per $ 100,000 borrowed over the term of the loan.
With this loan, you reduce your repayment tenure by a decade compared to the 30 year mortgage. This saves you a lot of money on interest over time, but it does mean that each monthly payment has to be higher.
15-year mortgage rates
The 15-year average mortgage rate today stands at 2.321%, up 0.034% from yesterday’s average of 2.287%. For every $ 100,000 borrowed at today’s average rate, your total monthly payment of principal and interest would be $ 658. The total interest charge would be $ 18,511 per $ 100,000 borrowed over the term of the loan.
This loan has a very short repayment time. The result is that all of your monthly payments must be very high. This affects the flexibility you have in your budget. But you’ll be debt free sooner and save a lot of interest over time.
The average 5/1 ARM rate is 3.079%, up 0.082% from yesterday’s average of 2.997%. ARM stands for Variable Rate Mortgage. This means that the rate can change, unlike a fixed rate loan. Chances are, the rate will increase after five years, and you could end up with higher monthly payments and a more expensive loan over time. Weigh this risk well.
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 the closure 15 days
- LOCK if the closure 30 days
- FLOAT if closing 45 days
- FLOAT if the closure 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.