Today, mortgage rates are generally lower. Based on data from Zillow, the 30-year fixed interest rate has decreased by four basis points to 6.50%, while the 15-year fixed rate has fallen by the same amount to 5.83%.
Forecasts from economists suggest that mortgage rates are unlikely to improve significantly through 2025. In their February outlook, the Mortgage Bankers Association (MBA) projected the 30-year fixed rate would stabilize at 6.50% by year-end. Similarly, Fannie Mae estimates the 30-year rate will be around 6.60% by the fourth quarter of 2025. If you’re considering a purchase, it might be wise to proceed rather than waiting for possibly lower rates.
Explore further: Which holds more importance, the mortgage rate or the home price?
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Here are the current mortgage rates based on the latest Zillow data:
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30-year fixed: 6.50%
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20-year fixed: 6.25%
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15-year fixed: 5.83%
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5/1 ARM: 6.50%
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7/1 ARM: 6.45%
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30-year VA: 5.98%
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15-year VA: 5.48%
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5/1 VA: 6.06%
Keep in mind, these figures represent national averages rounded to the nearest hundredth.
Here are today’s mortgage refinance rates according to the latest Zillow data:
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30-year fixed: 6.53%
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20-year fixed: 6.25%
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15-year fixed: 5.88%
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5/1 ARM: 6.56%
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7/1 ARM: 6.36%
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30-year VA: 5.98%
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15-year VA: 5.56%
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5/1 VA: 6.08%
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30-year FHA: 6.09%
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15-year FHA: 5.55%
Once again, these rates are national averages rounded to the nearest hundredth. Refinance rates often exceed those of new home purchases, though this isn’t universally true.
Learn more: Is now the right moment to refinance your mortgage?
Utilize the free Yahoo Finance mortgage calculator to understand how different mortgage terms and interest rates will affect your monthly payments.
Our calculator also takes into account factors such as property taxes and homeowners insurance, offering a comprehensive view of your estimated monthly payment rather than focusing solely on mortgage principal and interest.
Currently, the average 30-year mortgage rate stands at 6.50%. This type of mortgage, typically spread over 360 months, tends to have lower monthly payments compared to shorter-term loans.
Currently, the average 15-year mortgage rate is 5.83%. When weighing your options between a 15-year and a 30-year mortgage, consider your immediate versus long-term financial objectives.
A 15-year mortgage often has a lower interest rate compared to a 30-year option, which can be beneficial in the long haul by reducing the time you’ll be paying interest. However, bear in mind that your monthly payment will be larger since the loan is repaid in half the time.
For instance, on a $300,000 mortgage with a 30-year term and a 6.50% interest rate, your monthly payment would be about $1,896, leading to a total interest payment of $382,633 over the life of the loan in addition to the principal.
Conversely, for the same $300,000 mortgage on a 15-year term at a 5.83% interest rate, your monthly payment would increase to $2,504, but you would only pay $150,738 in interest across the years.
With a fixed-rate mortgage, your interest rate is secured for the entire duration of the loan. If you refinance, a new rate will be established.
An adjustable-rate mortgage maintains the same rate for an agreed-upon period, after which the rate may change based on various factors, including economic conditions and the contractual maximum adjustments. For example, with a 7/1 ARM, your rate is fixed for the first seven years, then adjusts annually for the remaining 23 years.
Adjustable rates often start lower than fixed rates, though they might rise once the initial lock period concludes. Recently, some fixed rates have begun undercutting adjustable rates. It’s advisable to discuss these details with your lender before making a decision.
Explore further: Fixed-rate vs. adjustable-rate mortgages
Mortgage lenders frequently offer the most competitive rates to individuals who have higher down payments, excellent credit scores, and low debt-to-income ratios. To secure a better rate, consider increasing your savings, elevating your credit score, or reducing debt before initiating your home search.
If you’re aiming for lower rates, holding off for a drop may not be the best strategy unless you’re willing to wait until late 2025. If you’re prepared to make a purchase, concentrating on your financial situation is likely a more effective approach to obtaining a lower rate.
To identify the most suitable mortgage lender for your needs, seek preapproval from three or four lending institutions. Ensure you submit your applications within a brief timeframe to allow for the most accurate comparisons with minimal impact on your credit score.
When selecting a lender, don’t focus solely on interest rates; also review the mortgage annual percentage rate (APR) which encompasses the interest rate, any discount points, and associated fees. The APR is a critical figure, revealed as a percentage, reflecting the true annual cost of borrowing funds. This is likely the key number to evaluate when comparing lenders.
Discover more: The best mortgage lenders for first-time buyers
Per Zillow, the national average for a 30-year mortgage is 6.50%, while the 15-year average stands at 5.83%. However, these are averages, so rates in your region may differ, with higher averages in pricier areas and lower ones in more affordable regions.
The current average rate for a 30-year fixed mortgage is 6.50% according to Zillow. That said, you could secure an even better rate with strong credit, a significant down payment, and a low debt-to-income ratio.
While mortgage rates aren’t expected to plummet in the near term, there may be minor fluctuations over time.
