Current 20-Year Mortgage Rates Climb Above 7% | September 27, 2022
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Based on data compiled by Credible, mortgage refinance rate increased for two key mandates and remained unchanged for two other mandates since yesterday.
Rates were last updated on September 27, 2022. These rates are based on the assumptions presented here. Actual rates may vary. With 5,000 reviews, Credible maintains an “excellent” Trustpilot score.
What does that mean: With 20-year mortgage refinance rates exceeding 7% today and 30-year rates not far behind, homeowners looking to refinance can save the most on interest by opting for a shorter term. Rates for a 10- and 15-year refinance have remained stable at 5.5% for seven consecutive days.
Today’s Mortgage Rates for Buying a Home
According to data compiled by Credible, mortgage rates for home purchases rose for longer repayment terms and remained unchanged for shorter terms since yesterday.
Rates were last updated on September 27, 2022. These rates are based on the assumptions presented here. Actual rates may vary. Credible, a personal finance marketplace, has 5,000 Trustpilot reviews with an average rating of 4.7 stars (out of a possible 5.0).
What does that mean: Rates on a 20-year mortgage jumped above 7% for the first time this year, and rates on 30-years (the most common term) soared to 6.875%. With shorter terms sitting nearly 1.6 percentage points lower than 20-year rates, buyers who can manage a higher monthly payment and opt for a 10- or 15-year mortgage can save significantly more in interests.
To find great mortgage rates, start by using Credible’s secure website, which can show you current mortgage rates from multiple lenders without affecting your credit score. You can also use Credible’s mortgage calculator to estimate your monthly mortgage payments.
How mortgage rates have changed over time
Current mortgage interest rates are well below the highest average annual rate recorded by Freddie Mac – 16.63% in 1981. A year before the COVID-19 pandemic upended economies around the world, the mortgage rate he average interest on a 30-year fixed rate mortgage for 2019 was 3.94%. The average rate for 2021 was 2.96%, the lowest annual average for 30 years.
The historic decline in interest rates means that homeowners with mortgages from 2019 could potentially realize significant interest savings by refinancing with one of today’s lowest interest rates. When considering a mortgage or refinance, it’s important to consider closing costs such as appraisal, application, origination, and attorney’s fees. These factors, in addition to the interest rate and loan amount, all contribute to the cost of a mortgage.
Are you looking to buy a house? Credible can help you compare current rates from multiple mortgage lenders both in minutes. Use Credible’s online tools to compare rates and get prequalified today.
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How Credible Mortgage Rates Are Calculated
Changing economic conditions, central bank policy decisions, investor sentiment and other factors influence the movement of mortgage rates. Credible’s average mortgage rates and mortgage refinance rates shown in this article are calculated based on information provided by partner lenders who pay compensation to Credible.
The rates assume a borrower has a 740 credit score and is borrowing a conventional loan for a single-family home that will be their primary residence. Rates also assume no (or very low) discount points and a 20% deposit.
The credible mortgage rates listed here will only give you an idea of today’s average rates. The rate you actually receive may vary based on a number of factors.
Fixed-rate vs. adjustable-rate mortgages: their impact on interest costs
Interest rates on fixed rate mortgages do not change over the term of the loan, but tend to be higher than the original interest rate on variable rate mortgages, or ARMs.
The initial interest rates for ARMs are generally lower than those for fixed rate mortgages. But after an introductory period ends, your interest rate will change – and it could rise significantly. Introductory periods can vary from several months to a year or a few years. After the introductory period, your interest rate will be based on an index specified by your lender. ARMs may or may not cap the increase in your interest rate.
If you’re trying to find the right mortgage rate, consider using Credible. You can use Credible’s free online tool to easily compare multiple lenders and see pre-qualified rates in just minutes.
Do you have a financial question, but you don’t know who to contact? Email The Credible Money Expert at [email protected] and your question may be answered by Credible in our Money Expert section.
As a credible authority on mortgages and personal finance, Chris Jennings has covered topics like mortgages, mortgage refinance, and more. He was a publisher and editorial assistant in the online personal finance space for four years. His work has been featured by MSN, AOL, Yahoo Finance, etc.