Today's mortgage and refinance rates: September 24, 2022 | Rates increase dramatically following Fed hike

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Mortgage rates spiked this week as markets absorbed the news of another extra large Federal Reserve rate hike. During his press conference, Fed Chair Jerome Powell reiterated the Fed's commitment to aggressively fighting inflation, even if it means pushing the economy into a recession.

"The chances of a soft landing are likely to diminish to the extent that policy needs to be more restrictive or restrictive for longer," Powell said. "Nonetheless, we're committed to getting inflation back down to 2% because we think that a failure to restore price stability would mean far greater pain later on."

Mortgage rates may continue increasing this year as the Fed works to get price growth under control. But many forecasts expect that rates will start to come down later next year.

Mortgage rates today

Mortgage refinance rates today

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Use our free mortgage calculator to see how today's interest rates will affect your monthly payments.

By clicking on "More details," you'll also see how much you'll pay over the entire length of your mortgage, including how much goes toward the principal vs. interest.

30-year fixed mortgage rates

The current average 30-year fixed mortgage rate is 6.29%, according to Freddie Mac. This is the highest this rate has been since 2008, and the fifth week in a row it's 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. 

15-year fixed mortgage rates

The average 15-year fixed mortgage rate is 5.44%, an increase from the prior week, according to Freddie Mac data. The last time this rate was above 5% was in 2009.

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 4.97%, a slight 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 the life of the loan.

Will mortgage rates go up in 2022?

To help the US economy during the COVID-19 pandemic, the Federal Reserve aggressively purchased assets, including mortgage-backed securities. This helped keep mortgage rates at historic lows.

However, the Fed has begun to reduce the assets it holds and is expected to increase the federal funds rate two more times in 2022, following increases at its last five meetings.

Though not directly tied to the federal funds rate, mortgage rates are sometimes pushed up as a result of Fed rate hikes and investor expectations of how those hikes will impact the economy.

Inflation remains elevated, but has started to slow, which is a good sign for mortgage rates and the broader economy. 

What is a fixed-rate mortgage vs. adjustable-rate mortgage?

Historically, adjustable mortgage rates tend to be lower than 30-year fixed rates. When mortgage rates go up, ARMs can start to look like the better deal — but it depends on your situation. 

Fixed-rate mortgages lock in your rate for the entire life of your loan. Adjustable-rate mortgages lock in your rate for the first few years, then your rate goes up or down periodically.

Because adjustable rates start low, they are worthwhile options if you plan on selling your home before the interest rate changes. For instance, if you get a 7/1 ARM and want to move before the seven year fixed-rate period is up, you won't risk paying a higher rate later.

But if you want to buy a forever home, a fixed rate could still be a better fit, since you won't chance your rate increasing in a few years.