Today’s Mortgage Rates & Trends, May 11, 2021

Young girl putting up a painting in her new home.
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Daily mortgage rates rose for most major loan types but borrowing costs were still cheaper than a week ago in most cases.

The average interest rate for 30-year fixed mortgages—the most popular choice for house hunters—rose to 3.17% from 3.15% the previous business day, while for 15-year fixed loans, it ticked up to 2.40% from 2.39%. Rates also rose on 30-year jumbo loans, but stayed the same for 15-year jumbo loans. Refinancing rates for most major loan types also rose or stayed the same, while rates for 5/1 adjustable-rate mortgages dipped very slightly.

Rates on fixed mortgages have ticked up from the record lows reached this winter (2.65% for 30-year and 2.16% for 15-year, according to Freddie Mac) but are still quite affordable by historic standards. (In the decade leading up to the onset of the pandemic, for instance, the 30-year often stayed between 3.5% and 4.5%.) Such low rates have bolstered buying power during the pandemic, allowing house hunters to buy more expensive homes with the same monthly budget and helping to fuel a fiercely competitive residential real estate boom. 

Forecasters expect a very gradual uptick in rates as the economy improves, with Freddie Mac expecting about a 40-basis point increase in the 30-year fixed by the fourth quarter of this year.

Important

Mortgage rates, like the rates on any loan, are going to depend on your credit score, with lower rates going to people with better scores, all else being equal. The rates shown reflect the average offered by more than 200 of the country’s top lenders, assuming the borrower has a FICO credit score of 700-759 (within the “good” or “very good” range) and a loan-to-value ratio of 80%.

30-Year Mortgage Rates Increase

A 30-year fixed mortgage is by far the most common type of mortgage because it offers a consistent and relatively low monthly payment. (Shorter-term fixed mortgages have higher payments because the borrowed money is paid back more quickly.) 

Besides conventional 30-year mortgages, some are backed by the Federal Housing Authority or the Department of Veterans Affairs. FHA loans offer borrowers with lower credit scores or a smaller down payment a better deal than they might otherwise get; VA loans let current or past members of the military and their families skip a down payment. 

  • The average 30-year fixed mortgage rate rose to 3.17% from 3.15% the previous business day. A week ago, it was 3.23%. For every $100,000 borrowed, monthly payments would cost approximately $430.83, about $3.28 less than a week ago.
  • The average 30-year FHA fixed mortgage rate rose to 3.05% from 2.95% the previous business day. A week ago, it was 3.04%. For every $100,000 borrowed, monthly payments would cost approximately $424.31, virtually the same as a week ago.
  • The average 30-year VA fixed mortgage rate rose to 3.07% from 2.97% the previous business day. A week ago, it was 3.09%. For every $100,000 borrowed, monthly payments will cost approximately $425.39, about $1 less than a week ago.
  • The average jumbo 30-year fixed mortgage rate rose to 3.47% from 3.46%. A week ago, it was 3.51%. For every $100,000 borrowed, monthly payments would cost $447.37, about $2.23 less than a week ago.

Tip

All else being equal, a higher rate increases your monthly payment, but there are other parts of the equation. For example, if you know your monthly payment can’t be more than $2,000, you can get a $387,000 home at a 3.4% rate or a $380,000 home at a 3.6% rate. Both assume a 20% down payment, typical homeowners’ insurance costs, and property taxes, per our mortgage calculator.

15-Year Mortgage Rate Inches Up

The major advantage of a 15-year fixed mortgage is that it offers a lower interest rate than the 30-year and you’re paying off your loan more quickly, so your total borrowing costs are far lower. But for the same reason—that the loan is paid back over a shorter time frame—the monthly payments will be higher.

  • The average 15-year fixed mortgage rate rose to 2.40% from 2.39% the previous business day. A week ago, it was 2.45%. For every $100,000 borrowed, monthly payments would cost approximately $662.09, about $2.35 less than a week ago.

Note

Besides fixed-rate mortgages, there are adjustable-rate mortgages (ARMs), where rates change based on a benchmark index tied to Treasury bonds or other interest rates. Most adjustable-rate mortgages are actually hybrids, where the rate is fixed for a period of time and then adjusted periodically. For example, a common type of ARM is a 5/1 loan, which has a fixed rate for five years (the “5” in “5/1”) and is then adjusted every one year (the “1”).

Jumbo Mortgage Rates Hardly Move

Jumbo loans, which allow you to borrow bigger amounts for more expensive properties, tend to have slightly higher interest rates than loans for more standard amounts. Jumbo means over the limit that Fannie Mae and Freddie Mac are willing to buy from lenders, typically $548,250 for a single-family home (except in Hawaii, Alaska, and a few federally designated high-cost markets, where the limit is $822,375).

  • The average rate for a jumbo 30-year fixed mortgage rose to 3.47% from 3.46% the previous business day. A week ago, it was 3.51%. For every $100,000 borrowed, monthly payments would cost approximately $447.37, about $2.23 less than a week ago.
  • The average rate for a jumbo 15-year fixed mortgage stayed the same at 3.15%. A week ago, it was 3.19%. For every $100,000 borrowed, monthly payments would cost approximately $697.82, about $2 less than a week ago.

Refinance Rates Barely Change

Refinancing an existing mortgage tends to be slightly more expensive than getting a new one, especially in a low-rate environment. 

  • The average rate to refinance with a 30-year fixed mortgage rose to 3.40% from 3.39% the previous business day. A week ago, it was 3.48%. For every $100,000 borrowed, monthly payments would cost approximately $443.48, about $4.45 less than a week ago.
  • The average rate to refinance with a 15-year fixed mortgage stayed the same at 2.61%. A week ago, it was 2.65%. For every $100,000 borrowed, monthly payments at that rate will cost approximately $671.98, about $1.89 less than a week ago.

Methodology

Our rates reflect national averages provided by more than 200 of the country's top lenders the previous business day. They assume a loan-to-value ratio of 80% and a borrower with a FICO credit score of 700 to 759—within the “good” to “very good” range. They’re representative of the rates customers would see in actual quotes from lenders, based on their qualifications, and may vary from advertised teaser rates.