Mortgages

Best 30-year Mortgage Rates | NextAdvisor with TIME

· 30-Year Fixed Rate, 5.980%, 5.990% ; 30-Year FHA Rate, 5.180%, 6.020% ; 30-Year VA Rate, 5.160%, 5.270% ; 30-Year Fixed Jumbo Rate, 5.970%, 5.980%
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Home prices and mortgage rates were predicted to rise in 2022, and so far this has come true.

If you’re shopping for a home, here’s what to consider when comparing mortgage lenders and the 30-year fixed mortgage rate.

History of the 30-Year Fixed Mortgage Rate

This chart, which uses data from a survey by Freddie Mac that differs slightly but generally tracks with the Bankrate survey used by NextAdvisor, offers a glimpse at how today’s rates compare with the past two decades. According to the chart, mortgage rates are up from the historically low years of 2020 and 2021, but they still aren’t high if you zoom out more than a few years.

Read more: Getting Great Investment Property Mortgage Rates | Visio

Keep today’s rates in perspective. Rates below 5% were pretty rare before 2011, and rates between 4% and 5% were fairly common before the pandemic, Paul Thomas, vice president of capital markets for mortgages at Zillow Group, told us. “As a homebuyer, it’s important to keep in mind that while mortgage rates have gone up this year, they’re still at historic lows.”

Compare Multiple Lenders

Whether you are looking to refinance or purchase, you can compare lender offers here using this Home Loan Comparison Calculator. You can enter in the loan amount, rate, fees, and term for each offer and see a true side-by-side comparison.

The Pros and Cons: When to Consider a 30-year Fixed Mortgage

There are a handful of advantages to a 30-year fixed-rate mortgage that make it the right choice in many cases. But choosing a mortgage is a highly personal decision and there are certain situations where a 30-year fixed mortgage isn’t the best fit.

Is a 30-Year Fixed Mortgage Right for Me?

Read more: Interest rates rise to 1.75% – what it means for you –

Whether or not a 30-year fixed-rate mortgage is right for you depends on your personal situation. Everything from your income to where you want to live can impact the decision.

A 30-year fixed mortgage can be ideal for a first-time homebuyer because of the lower monthly payment. But as your income increases, you may want to refinance to a shorter-term loan to reduce the interest you’ll pay over the life of the loan.

There are even circumstances where adjustable-rate mortgages (ARM) can make sense. If you know you will be moving before the interest rate adjusts, an ARM may be cheaper than a 30-year fixed rate mortgage for those first few years. Although, in today’s low rate environment, an ARM loan makes less sense for homebuyers than it usually would.

How Do I Refinance a 30-Year Mortgage?

Read more: Spikes in mortgage rate force many potential homebuyers to rethink their plans : NPR

Refinancing is when you replace your existing mortgage with a new home loan. When 30-year refinance rates are significantly lower than your existing mortgage rate, you may be able to save money with a refinance. Keep in mind that the potential savings will need to outweigh the upfront closing costs you’ll pay to refinance, which are typically 3% to 6% of the loan balance.

Another factor to consider when you refinance is, how many years have you been paying off your current mortgage? If you’re 10 years into a 30-year loan, taking out a new 30-year mortgage adds those 10 years back onto your repayment term. Even though you may be lowering your monthly payment and rate in that scenario, you could end up paying more interest over the long term even if you have a lower rate.

For more information on how to refinance a mortgage, see NextAdvisor’s refinance page.

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