Should you wait for lower rates?

Mortgage rates have fallen for several days in a row, but are still relatively high. According to Zillow, the current 30-year fixed rate is 6.67%and the 15-year fixed rate is 5.95%. So, should you buy soon or wait for lower prices?

First of all, mortgage rates should fall throughout 2025, but the declines will likely be gradual. Second, trying to time the real estate market is similar to timing the stock market. It’s often unproductive because there are so many factors at play, and you don’t know what’s going to happen at any given time. If you’re financially ready to buy a home, you may want to start the process sooner rather than later. Remember, you can always refinance to a lower rate in a few years.

Do you have questions about buying, owning or selling a home in today’s market? Send your question to the Realtors team at Yahoo using This Google form.

Dig deeper: Is 2025 a good time to buy a home?

Here are the current mortgage rates, according to the latest Zillow data:

• 30 years fixed: 6.67%

• 20 years fixed: 6.45%

• 15 years fixed: 5.95%

• 1/5 arm: 6.94%

• 7/1 arm: 6.91%

• 30 years fa: 6.12%

• 15 years fa: 5.56%

• 1/5 volt: 6.16%

• 30-Year FHA Loans: 6.33%

• 5/1 FHA: 6.38%

Remember, these are national averages and are rounded to the nearest hundredth.

Read more: How are mortgage rates determined?

These are the current mortgage refinancing rates, according to the latest Zillow data:

• 30 years fixed: 6.67%

• 20 years fixed: 6.46%

• 15 years fixed: 5.92%

• 1/5 arm: 7.24%

• 7/1 arm: 7.45%

• 30 years fa: 6.10%

• 15 years fa: 5.72%

• 1/5 volt: 6.04%

• 5/1 FHA: 6.50%

Again, the numbers provided are national averages rounded to the nearest hundred. Although this is not always the case, mortgage refinance rates tend to be slightly higher than purchase rates.

A mortgage calculator can help you see how different mortgage terms and interest rates will affect your monthly payments. Use for free Mortgage Calculator Yahoo Finance To play with different outcomes.

Our calculator also takes into account factors such as property taxes and homeowners insurance when estimating your monthly mortgage payment. This gives you a better idea of ​​your total monthly payment than if you just looked at the mortgage principal and interest.

The average interest rate on a 30-year mortgage today is 6.67%. The 30-year term is the most popular type of mortgage because by spreading your payments over 360 months, your monthly payment is relatively low.

If you have $300,000 mortgage With a 30-year term and an interest rate of 6.67%, your monthly payment toward principal and interest will be approx $1,930And you will pay $394,752 In interest over the life of your loan – plus the original $300,000.

The average interest rate on a 15-year mortgage is 5.95% today. Several factors must be considered when choosing between a Mortgages for 15 years and 30 years.

A 15-year mortgage comes with a lower interest rate than a 30-year term. This is great in the long run because you’ll pay off your loan 15 years earlier, meaning 15 fewer years to accrue interest.

However, since you’re squeezing the same debt payment into half the time, your monthly payments will be higher.

If you get the same $300,000 mortgage but with a 15-year term and a 5.95% interest rate, your monthly payment will jump to as much as $2,523 – But you’ll just pay $154,225 In interest over the years.

Dig deeper: How much house can I afford? Use our home affordability calculator.

with Adjustable rate mortgageYour price is fixed for a specific period of time and then increases or decreases periodically. For example, with a 5/1 ARM, the rate stays the same for the first five years, and then changes each year.

Adjustable rates typically start lower than fixed rates, but you run the risk of the rate going up once the introductory rate lock-in period ends. But an ARM can be a good fit if you plan to sell the home before the rate lock-in period expires — that way, you’ll pay a lower price without worrying about it rising later.

ARM rates have also been higher than fixed rates recently. Before you commit to a fixed or adjustable rate mortgage, be sure to research the best lenders and rates. Some will offer adjustable rates that are more competitive than others.

Mortgage lenders typically offer the lowest mortgage rates to people with higher down payments, excellent credit scores, and low debt-to-income ratios. So, if you want a lower price, try to save more, Improve your credit scoreOr pay off some debt before you start shopping for homes.

You can also buy your interest rate permanently by paying Discount points When closing. temporary Buy interest rate It’s also an option – for example, maybe you get a 6% rate with a 2-1 buyout. Your interest rate will start at 4% for your first year, rise to 5% for your second year, and then stabilize at 6% for the rest of your studies.

Just think about whether these purchases are worth the extra money at closing. Ask yourself whether you will stay in the home long enough so that the amount you save at a lower price offsets the cost of purchasing at a lower price before making your decision.

Learn more: How to get the lowest mortgage rates

Here are the interest rates for some of the most popular mortgage terms: According to Zillow data, the national average 30-year fixed rate is 6.67%, the 15-year fixed rate is 5.95%, and the 5/1 ARM rate is 6.94%. .

The normal mortgage rate on a 30-year fixed loan is 6.67%. However, keep in mind that this is the national average based on Zillow data. The average may be higher or lower depending on where you live in the United States

Mortgage rates likely won’t drop significantly at the beginning of 2025, although they may drop a little here and there.