Mortgage Interest Rates Today, May 22, 2024 | Rates Are Down Slightly. When Will They Drop Further?
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Mortgage rates are down this month. So far in May, 30-year mortgage rates have averaged around 6.75%, which is 10 basis points lower than the previous month's average. But whether they'll go down further depends on how inflation trends in the coming months.
In April, the Consumer Price Index rose 3.4% year over year, a downtick from March's reading. This cooler inflation data allowed mortgage rates to ease somewhat. If the next few months continue to show that inflation is decelerating, mortgage rates could go down further this year.
In the meantime, borrowers should expect mortgage rates to remain near their current levels. Rates are still prohibitively high for many would-be homebuyers, but affordability may increase next year, allowing more buyers to enter the market.
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Mortgage Rates for Buying a Home
30-Year Fixed Mortgage Inch Down (-0.06%)
The current average 30-year fixed mortgage rate is 6.67%, down six basis points from where it was this time last week, according to Zillow data. This rate is down compared to a month ago, when it was 6.95%.
At 6.67%, you'll pay $643 monthly toward principal and interest for every $100,000 you borrow.
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.
20-Year Fixed Mortgage Rates Decrease Slightly (-0.06%)
The average 20-year fixed mortgage rate is six basis points down from where it was last week, and is sitting at 6.25%. This time last month, the rate was 6.87%.
With a 6.25% rate on a 20-year term, your monthly payment will be $731 toward principal and interest for every $100,000 borrowed.
A 20-year term isn't as common as a 30-year or 15-year term, but plenty of mortgage lenders still offer this option.
15-Year Fixed Mortgage Rates Go Down (-0.09%)
The average 15-year mortgage rate is 6.00%, nine basis points lower than last week. It's down compared to this time last month, when it was 6.35%.
With a 6.00% rate on a 15-year term, you'll pay $844 each month toward principal and interest for every $100,000 borrowed.
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.
7/1 ARM Rates Plunge (-0.89%)
The 7/1 adjustable mortgage rate is down 89 basis points from a week ago, currently at 6.78%. It's also down compared to a month ago, when it was at 7.19%.
At 6.78%, your monthly payment would be $651 toward principal and interest for every $100,000 borrowed — but only for the first seven years. After that, your payment would increase or decrease annually depending on the new rate.
5/1 ARM Rates Fall Over Half a Percentage Point (-0.58%)
The average 5/1 ARM rate is 6.65%, a 58-basis-point decrease from last week. It's down compared to where it was a month ago, when it was 7.26%.
Here's how a 6.65% rate would affect you for the first five years: You'd pay $642 per month toward principal and interest for every $100,000 you borrow.
30-year FHA Rates Decrease (-0.15%)
The average 30-year FHA interest rate is 6.03% today, which is 15 basis points down from last week. This rate was 6.12% a month ago.
At 6.03%, you would pay $601 monthly toward principal and interest for every $100,000 borrowed.
FHA mortgages are good choices if you don't qualify for a conforming mortgage. You'll need a 3.5% down payment and 580 credit score to qualify.
30-year VA Rates Drop a Bit (-0.13%)
The current VA mortgage rate is 5.94%, 13 basis points lower than this time last week. This rate was 6.29% a month ago.
With a 5.94% rate, your monthly payment would be $596 toward principal and interest for every $100,000 you borrow.
Mortgage Refinance Rates
30-Year Fixed Refinance Rise (+0.43%)
The average 30-year refinance rate is 7.63%, 43 basis points higher than last week. It's down a bit compared to a month ago, when it was 7.87%.
Here's how a 7.63% rate would affect your monthly payments: You'd pay $708 toward principal and interest for every $100,000 borrowed.
Refinancing into a 30-year term can land you lower monthly payments, but you'll ultimately pay more by refinancing into a longer term.
20-Year Fixed Refinance Rates Jump Up (+0.61%)
The current 20-year fixed refinance rate is 7.53%, which is up 61 basis points compared to a week ago. This rate was 7.95% this time last month.
A 7.53% rate on a 20-year term will result in a $807 monthly payment toward principal and interest for every $100,000 you borrow.
15-Year Fixed Refinance Rates Tick Up (+0.23%)
The average 15-year fixed refinance rate is 6.73%, which is 23 basis points higher compared to last week. It's also up compared to this time a month ago, when it was at 6.66%.
A 6.73% rate on a 15-year term means you'll pay $884 each month toward principal and interest for every $100,000 borrowed.
Refinancing into a 15-year term can save you money in the long run, because you'll get a lower rate and pay off your mortgage faster than you would with a 30-year term. But it could result in higher monthly payments.
7/1 ARM Refinance Rates Fall (-0.71%)
The average 7/1 ARM refinance rate is 6.75%, down 71 basis points from where it was last week. It's down from a month ago, when it was 7.41%.
Refinancing into a 7/1 ARM with a 6.75% rate means your monthly payment toward principal and interest will be $649 for every $100,000 you borrow. This will be the payment for the first seven years, then your rate will change annually unless you refinance again.
5/1 ARM Refinance Rates Down Dramatically (-1.23%)
The 5/1 ARM refinance rate is 6.66%, which is 123 basis points lower than it was this time last week. It's down compared to this time last month, when it was 7.81%.
A 6.66% rate will result in a monthly payment of $643 toward principal and interest for every $100,000 borrowed. You'll pay this amount for the first five years of your new mortgage.
30-Year FHA Refinance Rates Flat (No Change)
The 30-year FHA refinance rate is 5.79%, which is the same as it was last week. This rate was 6.14% this time last month.
A 5.79% refinance rate would lead to a $586 monthly payment toward the principal and interest per $100,000 borrowed.
30-Year VA Refinance Rates Inch Down (-0.11)
The average 30-year VA refinance rate is 5.78%, which is up 11 basis points compared to where it was was last week. This rate was 6.19% a month ago.
At 5.78%, your new monthly payment would be $585 toward principal and interest for every $100,000 you borrow.
Are Mortgage Rates Going Down?
Mortgage rates started ticking up from historic lows in the second half of 2021 and increased over three percentage points in 2022. Mortgage rates also rose dramatically in 2023, though they started trending back down toward the end of the year. Though rates have been somewhat elevated recently, they should go down by the end of 2024.
For homeowners looking to leverage their home's value to cover a big purchase — such as a home renovation — a home equity line of credit (HELOC) may be a good option while we wait for mortgage rates to ease further. Check out some of our best HELOC lenders to start your search for the right loan for you.
A HELOC is a line of credit that lets you borrow against the equity in your home. It works similarly to a credit card in that you borrow what you need rather than getting the full amount you're borrowing in a lump sum. It also lets you tap into the money you have in your home without replacing your entire mortgage, like you'd do with a cash-out refinance.
Current HELOC rates are relatively low compared to other loan options, including credit cards and personal loans.