Today’s Mortgage Rates — April 2, 2021: Rates Are Mixed

Today’s mortgage rates are mixed compared to yesterday. Here’s what they look like:

Data source: The Ascent’s national mortgage interest rate tracking.

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30-year mortgage rates

The average 30-year mortgage rate today is 3.308%, up 0.006% from yesterday. At today’s rate, you’ll pay principal and interest of $439.00 for every $100,000 you borrow. That doesn’t include added expenses like property taxes and homeowners insurance premiums.

20-year mortgage rates

The average 20-year mortgage rate today is 2.985%, down 0.008% from yesterday. At today’s rate, you’ll pay principal and interest of $554.00 for every $100,000 you borrow. Though your monthly payment will go up by $115.00 with a 20-year, $100,000 loan versus a 30-year loan of the same amount, you’ll save $24,942.00 in interest over the course of your repayment period for every $100,000 you borrow.

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15-year mortgage rates

The average 15-year mortgage rate today is 2.567%, down 0.002% from yesterday. At today’s rate, you’ll pay principal and interest of $670.00 for every $100,000 you borrow. Compared to the 30-year loan, your monthly payment will be $231.00 higher per $100,000 in mortgage principal. Your interest savings, however, will amount to $37,302.00 over the life of your repayment period per $100,000 of mortgage debt.

5/1 ARMs

The average 5/1 ARM rate is 3.081%, up 0.034% from yesterday. With a 5/1 ARM, you lock in your interest rate for five years only, so there’s risk involved — namely, that your rate will climb over time. On the flipside, a 5/1 ARM could save you money on your monthly mortgage payments for the next five years, and from there, you’d have the option to refinance your home loan. An adjustable-rate mortgage is worth considering based on today’s rates, but make sure you know what you’re getting into.

Should I lock in my mortgage rate now?

A mortgage rate lock guarantees you a specific interest rate for a certain period of time — usually 30 days, but you may be able to secure your rate for up to 60 days. You’ll generally pay a fee to lock in your mortgage rate, but that way, you’re protected if rates climb between now and when you close on your home loan.

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If you plan to close on your home within the next 30 days, then it pays to lock in your mortgage rate based on today’s rates — especially since they’re still pretty low. But if your closing is more than 30 days away, you may want to choose a floating rate lock instead for what will usually be a higher fee, but one that could save you money in the long run. A floating rate lock lets you secure a lower rate on your loan if rates fall before you close on your mortgage, and while today’s rates are still pretty competitive despite a recent uptick, we don’t know if rates will go up or down over the next few months. As such, it pays to:

  • LOCK if closing in 7 days
  • LOCK if closing in 15 days
  • LOCK if closing in 30 days
  • FLOAT if closing in 45 days
  • FLOAT if closing in 60 days

Today’s mortgage rates are pretty attractive, even though they’re not as low as they were earlier on in the year. And if you have a great credit score and low debt-to-income ratio, you’ll be even more likely to qualify for a low rate that keeps your monthly payments affordable.

If you’re ready to apply for a mortgage, reach out to different lenders. Each one establishes its own rate and closing costs, so it’s important to compare offers — especially considering that the mortgage you lock in may be the loan you wind up paying off for the next three decades of your life.

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View more information: https://www.fool.com/the-ascent/mortgages/articles/todays-mortgage-rates-april-2-2021-rates-are-mixed/

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