Our experts answer readers' home-buying questions and write unbiased product reviews (here's how we assess mortgages). In some cases, we receive a commission from our partners; however, our opinions are our own.
Current Mortgage and Refinance Rates
The current average 30-year fixed mortgage rate is 6.39% for the week ending April 20, according to Freddie Mac. While this is an increase from the week before, and above the four-week average of 6.32%, they're still lower than we saw in the second half of 2022.
However, it looks like home prices may be falling. The National Association of Realtors told the Wall Street Journal that compared to the previous year, home prices for March — the most recent data available — fell across the US for two months in a row for the first time in over a decade.
30-year Fixed Mortgage Rates
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.
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.
15-year Fixed Mortgage Rates
The average 15-year fixed mortgage rate is 5.76%, an 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.
Should I Get a HELOC? Pros and Cons
If you're looking to tap into your home's equity, a HELOC (Insider tracks the best HELOC lenders) may be a good option right now. Unlike a cash-out refinance, you won't have to get a whole new mortgage with a new interest rate, and you'll likely get a better rate than you would with a home equity loan.
But HELOCs don't always make sense. It's important to consider the HELOC pros and cons.
HELOC pros
- Only pay interest on what you borrow
- Typically have lower rates than alternatives, including home equity loans, personal loans, and credit cards
- If you have a lot of equity, you could potentially borrow more than you could get with a personal loan
HELOC cons
- Rates are variable, meaning your monthly payments could go up
- Taking equity out of your home can be risky if property values decline or you default on the loan
- Minimum withdrawal amount may be more than you want to borrow
When Will Mortgage Rates Go Down?
Mortgage rates started ticking up from historic lows in the second half of 2021 and increased over three percentage points in 2022. Though rates had initially been trending down this year, they've since ticked back up.
As inflation starts to come down, mortgage rates will recede somewhat as well. If we experience a recession, rates may drop a little faster. But average 30-year fixed rates will likely remain somewhere in the 6% to 7% range throughout 2023.
How Do Fed Rate Hikes Affect Mortgages?
The Federal Reserve has been increasing the federal funds rate this year to try to slow economic growth and get inflation under control. So far, inflation has slowed, but it's still above the Fed's 2% target rate.
Mortgage rates aren't directly impacted by changes to the federal funds rate, but they often trend up or down ahead of Fed policy moves. This is because mortgage rates change based on investor demand for mortgage-backed securities, and this demand is often impacted by how investors expect Fed hikes to affect the broader economy.
As inflation starts to come down, mortgage rates should, too. But the Fed has indicated that it's watching for sustained signs of slowing inflation.