Mortgage and refinance rates have tumbled since last Sunday, and they are at historic lows overall.

If you’re financially able, think about securing a low rate on a fixed-rate mortgage now. It may be best to avoid an adjustable-rate mortgage, though. 

Mat Ishbia, CEO of United Wholesale Mortgage, told Insider that fixed-rate mortgages are preferable to adjustable-rate mortgages right now.

Fixed rates are currently starting lower than adjustable rates, and you risk your rate increasing in the future with an ARM. You might want to lock in a low rate while you can.

Rates from

Since last Sunday, both fixed and adjustable mortgage rates have decreased. The 15-year fixed rate fell by just two basis points. 

We’re supplying you with the national average rates for conventional mortgages, which may be what you consider “standard mortgages.” You may be eligible for a less expensive rate with a government-backed mortgage through the FHA, VA, or USDA. 

Overall, mortgage rates remain at striking lows. Low rates frequently indicate an economy in distress. Mortgage rates will probably stay low as the US continues to deal with the financial impact of the COVID-19 pandemic. 

Rates from

Refinance rates on both adjustable-rate and fixed-rate mortgages have gone down since last Sunday, with the 7/1 ARM rate decreasing most significantly.

With a 15-year fixed mortgage, you’ll pay off your loan in 15 years and pay the same interest rate the whole time. 

Your monthly payments will be higher with a 15-year term than a 30-year term because you’re paying off the same loan principal in half of the time. 

On the other hand, you’ll pay less overall with a 15-year term than a 30-year fixed mortgage. You’ll pay off the mortgage 15 years earlier, and you’ll receive a lower interest rate.  

If you take out a 30-year fixed mortgage, you’ll pay off your mortgage over three decades, and you’ll have a consistent interest rate. 

You’ll pay more in interest with a 30-year fixed mortgage than with a shorter term. You’re paying a higher interest rate for more years, so your total interest paid will be higher. 

However, your monthly payments will be smaller with a 30-year term than a 15-year term because you’re dividing up your payments over a longer period. 

While a fixed-rate mortgage locks in your rate for the duration of your loan, with an adjustable-rate mortgage, you’ll pay a consistent rate for the first several years, then that rate will vary systematically. A 10/1 ARM secures your rate for a decade. Then your rate will change annually. 

You might still prefer a fixed-rate mortgage, although ARM rates are now at historic lows. You can lock in a low rate for the next 15 or 30 years without gambling on a future ARM rate increase. 

If you’re thinking about getting an ARM, ask your lender what your rates would be if you chose a fixed-rate versus an adjustable-rate mortgage.

Today might be an excellent opportunity to secure a low mortgage rate. Rates for both fixed and adjustable mortgages have fallen since last week and remain at all-time lows. 

Importantly, you don’t need to hurry to get a low rate if you’re not ready. Rates will probably remain low well into 2021, if not longer, so you have the opportunity to improve your financial standing before considering any action. If you want to lock in the lowest rate, consider taking some of the following steps before applying:

  • Increase your credit score by making timely payments, the most important way to improve your score. You can also consider paying off debts or letting your credit age.
  • Save more for a down paymentYou may be able to put down as little as 3% if you’re looking for a conventional mortgage, but the smallest amount will depend on which type of mortgage you require. You’ll probably get a better rate with a higher down payment.
  • Lower your debt-to-income ratio. Your DTI ratio is the amount you pay toward debts each month, divided by your gross monthly income. You can improve your rate by lowering your ratio. To better your ratio, pay down debts or look for ways to increase your income. 

You can secure a low rate now if you’re financially able — though you still have time to wait if you need to improve your financial situation. 

Ryan Wangman is a reviews fellow at Personal Finance Insider reporting on mortgages, refinancing, bank accounts, and bank reviews. In his past experience writing about personal finance, he has written about credit scores, financial literacy, and homeownership.

Laura Grace Tarpley is the associate editor of banking and mortgages at Personal Finance Insider, covering mortgages, refinancing, bank accounts, and bank reviews. She is also a Certified Educator in Personal Finance (CEPF). Over her four years of covering personal finance, she has written extensively about ways to save, invest, and navigate loans.

See the mortgage rates for Sunday, February 14 »

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