Mortgage of the day, refinancing rate: August 29, 2022

Mortgage rates peaked in June, and while current rates aren’t that high, they’re significantly higher than they were in 2020, 2021, and even early 2022.

Historically low mortgage rates have caused the housing market to explode over the past two years. The results have been higher home prices and more competition for buyers. Now that rates are higher, the housing market has cooled – new home sales in July were at their slowest pace in more than six years. House prices are still very high in many areas. But some cities, like Boise and Denver, are starting to see prices drop.

While higher mortgage rates may be disappointing, the good news is that you may face less competition when buying a home now than you would have earlier this year.

Mortgage rates today

Mortgage refinance rates today

mortgage calculator

Use our free mortgage calculator to see the impact of today’s mortgage rates on your monthly payments. By plugging in different rates and terms, you’ll also understand how much you’ll pay over the life of your mortgage.

mortgage calculator

$1,161
Your estimated monthly payment

  • pay one 25% a higher down payment would save you $8,916.08 on interest charges
  • Lower the interest rate by 1% would save you $51,562.03
  • Pay an extra fee $500 each month would reduce the term of the loan by 146 month

Click “More Details” for tips on how to save money on your long-term mortgage.

30-year fixed mortgage rates

The current average 30-year fixed mortgage rate is 5.13%, according to Freddie Mac. This is a decrease from last week, when it was 5.22%. This rate has been volatile in recent weeks. In early August, it fell below 5% for the first time since April, but rose again the following week.

The 30-year fixed rate mortgage is the most common type of mortgage. With this type of mortgage, you’ll pay back what you borrowed over 30 years and your interest rate won’t change for the life of the loan.

The 30-year long term allows you to spread your payments out over a long period, which means you can keep your monthly payments lower and more manageable. The tradeoff is that you’ll get a higher rate than with shorter terms or adjustable rates.

15-year fixed mortgage rates

The average 15-year fixed mortgage rate is 4.55%, down slightly from the previous week, according to data from Freddie Mac. Last week, this rate was 4.59%.

If you’re looking for the predictability that comes with a fixed rate, but are looking to spend less on interest over the life of your loan, a 15-year fixed rate mortgage might be right for you. Since these terms are shorter and have lower rates than 30-year fixed rate mortgages, you could potentially save tens of thousands of dollars in interest. However, you will have a higher monthly payment than you would with a longer term.

5/1 Adjustable Mortgage Rates

The average 5/1 adjustable mortgage rate is 4.39%, down from the previous week.

Variable rate mortgages can seem very attractive to borrowers when rates are high, as rates on these mortgages are generally lower than fixed mortgage rates. A 5/1 ARM is a 30 year mortgage. For the first five years, you will have a fixed rate. After that, your rate will adjust once a year. If rates are higher when your rate adjusts, you’ll have a higher monthly payment than you started with.

If you’re considering an ARM, make sure you understand how much your rate might increase each time it adjusts and how much it might ultimately increase over the life of the loan.

Are mortgage rates increasing?

Mortgage rates started to recover from historic lows in the second half of 2021 and have risen significantly so far in 2022. More recently, rates have been relatively volatile.

Over the past 12 months, the consumer price index has increased by 8.5%. The Federal Reserve has been struggling to keep inflation under control and plans to raise the target federal funds rate three more times this year, following increases in March, May, June and July.

Although not directly tied to the fed funds rate, mortgage rates are sometimes pushed higher due to Fed rate hikes and investors’ expectations of the impact of those hikes on the economy. .

Inflation remains high, but has started to slow, which is a good sign for mortgage rates and the economy in general.

How can I find personalized mortgage rates?

Some mortgage lenders allow you to customize your mortgage rate on their websites by entering your down payment amount, zip code and credit score. The resulting rate is not fixed, but it can give you an idea of ​​what you will pay.

If you’re ready to start buying homes, you can get pre-approved from a lender. The lender makes a firm credit application and reviews your financial details to lock in a mortgage rate.

Leave a Reply

%d bloggers like this: