The average mortgage rate for a 30-year fixed-rate mortgage is now 3.03%, up from last week's rate of 2.97%. This rate is still extremely low compared to the historical average of 6.85%.
The 15-year fixed-rate mortgage saw a smaller increase this week, going to 2.31% from 2.26%. Historically, this rate averages 4.21%. It remains well below the average.
The 5/1 adjustable-rate mortgage (ARM) has an average rate of 2.71%, an increase from last week’s rate of 2.66%. The average rate for this type of loan historically is 4.19%, showing how low these rates are in comparison.
Refinance rates also increased this week, with the average rate for a 30-year fixed-rate refinance rate at 3.04%, up from last week's rate of 2.98%. Historically, the average rate for a 30-year refinance is 6.76%.
For those looking to refinance a shorter-term loan, the 15-year fixed-rate refinance rate now averages 2.32%, up from 2.27% last week. Historically, this rate averages 4.20%.
The 5/1 ARM refinance rate has an average rate of 2.73%, an increase from last week’s rate of 2.68%. The average rate for this type of loan historically is 4.17%.
Amidst the pandemic, mortgage and refinance rates have consistently remained lower than previously seen. This may be due to a variety of factors. With the Federal Reserve keeping the federal funds rate near zero, mortgage lenders can borrow at a lower cost, allowing them to offer lower rates. Furthermore, the influx of stimulus money, as well as the resulting economic recovery, may have led to an increase in consumer optimism, which often leads to higher borrowing demand and lower rates.
Due to low mortgage rates, homeowners may choose to lock in low rates for the long term, while new home buyers may be more attracted to the market when interest rates are low. Additionally, existing homeowners may be more likely to take advantage of refinancing opportunities.
Overall, mortgage and refinance rates are on the rise as of today, April 28th, 2021. The average 30-year fixed-rate mortgage is now 3.03%, while the 15-year fixed-rate mortgage is at 2.31%, and the 5/1 ARM is 2.71%. These rates are still significantly lower than their historical averages. Similarly, refinance rates rose this week with the 30-year fixed-rate refinance at 3.04%, the 15-year fixed-rate refinance at 2.32%, and the 5/1 ARM refinance at 2.73%.
The current low mortgage and refinance rates are likely a result of a few different factors. The Federal Reserve’s low federal funds rate has enabled mortgage lenders to borrow at a lower cost, allowing them to offer lower rates. In addition, the stimulus money and resulting economic recovery may have sparked consumer optimism, leading to a higher demand for borrowing and therefore lower rates.
These low rates are beneficial for both new home buyers and existing homeowners looking to refinance their mortgage. For new buyers, it provides an opportunity to get into the market at a lower cost. For existing homeowners, refinancing at a lower rate could lead to long-term savings. Overall, the current rates provide a good opportunity for individuals interested in buying or refinancing a mortgage.
This article was contributed on Aug 16, 2023
