According to Bankrate, the average mortgage rate for a standard 30-year fixed-rate mortgage was 6.57 percent last week, up 0.01 percentage points from the previous week’s 6.56 percent.
30-year fixed-rate mortgages are the most commonly requested loan term. With a 30-year fixed-rate mortgage, the monthly payment is lower than with a 15-year mortgage, but the interest rate is usually higher.
According to Bankrate, the average mortgage interest rate for a standard 15-year fixed-rate mortgage was 5.99 percent, down 0.01 percentage points from the previous week’s 6.00 percent.
For 15-year fixed-rate mortgages, the monthly payment is higher than for 30-year mortgages.
However, interest rates are usually lower and you pay less interest overall because you pay back your loan faster.
The average interest rate on a 5/1 adjustable-rate mortgage (ARM) was 6.20%, up 0.02 percentage points from the previous week’s 6.18%.
With an ARM, for example, you usually get a lower interest rate in the first five years than with a fixed-rate mortgage.
However, after this period, you may have to pay more or less, depending on the terms of your loan and the evolution of the interest rate on the market.
When choosing a mortgage, it is important to select a loan term or payment plan.
Typically, you’ll be offered a 15- or 30-year loan term, but according to CNET, 10-, 20-, or 40-year mortgages are not uncommon.
Mortgages can have a fixed or variable interest rate. The interest rates on fixed-rate mortgages are set in stone for the duration of the loan.
With variable rate mortgages, the interest rate is only fixed for a certain period of time and is then adjusted annually according to market developments.
