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Based on data compiled by Credible, mortgage refinance rate remained virtually unchanged from yesterday, with the exception of 10-year rates, which rose slightly.
Rates were last updated on March 10, 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: Although longer refinance terms are the most popular because they allow homeowners to spread out their payments over a longer period, they also tend to have the highest interest rates. And with rates for 30- and 20-year terms remaining at 4% or higher for the second day in a row, homeowners could consider a 15- or 10-year term when refinancing their current mortgage.
Today’s Mortgage Rates for Buying a Home
Based on data compiled by Credible, mortgage rates for home purchases rose for two key terms and remained unchanged for two others since yesterday.
Rates were last updated on March 10, 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: Buyers who are comfortable with a higher monthly mortgage payment might consider locking in a rate for a shorter term today. Rates on a 10-year mortgage are one percentage point lower than 30-year rates, which are the most common. And the 15-year fixed rates did not exceed 3.25%, despite the rise in rates.
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.
How much can I borrow for a mortgage?
It’s essential to have an idea of how much you can afford to borrow for a mortgage before you start shopping or making an offer on a home.
Generally, the 28/36 rule is a good measure of how much you can afford to borrow without restricting your finances. The rule states that your mortgage payment, including taxes and insurance, must not exceed 28% of your gross monthly income. And all of your debt, including your mortgage and other monthly expenses like car and student loan payments, shouldn’t exceed 36% of your gross monthly income.
For example, if your gross monthly income is $6,250 ($75,000 annual salary), you should be able to afford a monthly payment of $1,750. And your total monthly debt should not exceed $2,250.
As a general rule, you shouldn’t take out a mortgage that’s two to two and a half times your gross annual income. So, in the scenario above, the maximum you would need to borrow to buy a house would be $187,500.
Ultimately, lenders determine how much you can afford to borrow by weighing your income, debt, assets, credit, and other financial factors.
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.