Mortgage rates have been inching up in recent days after weeks of holding relatively steady. With 30-year fixed mortgage rates up 2% since the beginning of 2022, many would-be homebuyers are finding homeownership to be increasingly unaffordable. As a result, mortgage applications are tumbling.

“As the market tries to settle in at higher rate levels, buyer demand has gradually softened as consumers assess what their affordability looks like,” says Robert Heck, vice president of mortgage at Morty. “That said, things differ greatly market-to-market and the inventory situation remains dire in many locations, which can still drive demand.”

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Use our free mortgage calculator to see how today’s mortgage rates would impact your monthly payments. By plugging in different rates and term lengths, you’ll also understand how much you’ll pay over the entire length of your mortgage.

Click “More details” for tips on how to save money on your mortgage in the long run.

30-year fixed mortgage rates

The current average 30-year fixed mortgage rate is 5.23%, according to Freddie Mac. After several weeks of decreases, this is the first week since mid-May that this rate has increased.

The 30-year fixed-rate mortgage is the most common type of home loan. With this type of mortgage, you’ll pay back what you borrowed over 30 years, and your interest rate won’t change for the life of the loan.

The lengthy 30-year term allows you to spread out your payments over a long period of time, meaning you can keep your monthly payments lower and more manageable. The trade-off is that you’ll have a higher rate than you would with shorter terms or adjustable rates. 

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15-year fixed mortgage rates

The average 15-year fixed mortgage rate is 4.38%, a slight increase from the prior week, according to Freddie Mac data.

If you want the predictability that comes with a fixed rate but are looking to spend less on interest over the life of your loan, a 15-year fixed-rate mortgage might be a good fit for you. Because these terms are shorter and have lower rates than 30-year fixed-rate mortgages, you could potentially save tens of thousands of dollars in interest. However, you’ll have a higher monthly payment than you would with a longer term.

5/1 adjustable mortgage rates

The average 5/1 adjustable mortgage rate is 4.12%, an increase from the previous week.

Adjustable rate mortgages can look very attractive to borrowers when rates are high, because the rates on these mortgages are typically lower than fixed mortgage rates. A 5/1 ARM is a 30-year mortgage. For the first five years, you’ll have a fixed rate. After that, your rate will adjust once per year. If rates are higher when your rate adjusts, you’ll have a higher monthly payment than what you started with.

If you’re considering an ARM, make sure you understand how much your rate could go up each time it adjusts and how much it could ultimately increase over …read more

Source:: Business Insider

      

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