February 11, 2022: Mortgage interest rates rise


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Many mortgage rates jumped today to their highest level since the start of 2020, including 15-year and 30-year fixed mortgage rates. We also saw a significant rise in the average 5/1 adjustable rate mortgage rate. Mortgage rates have been quite low over the past period, making it a good time for potential buyers to lock in a fixed rate. But rates are dynamic and should continue to rise. Before buying a home, remember to consider your personal needs and financial situation, and speak with several lenders to find the best one for you.

30 Year Fixed Rate Mortgages

The average 30-year fixed mortgage rate is 3.98%, up 21 basis points from seven days ago. (One basis point equals 0.01%.) The most common loan term is a 30-year fixed mortgage. A 30 year fixed rate mortgage will usually have a lower monthly payment than a 15 year one, but usually a higher interest rate. You won’t be able to pay off your home as quickly and you’ll pay more interest over time, but a 30-year fixed rate mortgage is a good option if you’re looking to minimize your monthly payment.

15-year fixed rate mortgages

The average rate on a 15-year fixed mortgage is 3.34%, up 19 basis points from seven days ago. Compared to a 30-year fixed mortgage, a 15-year fixed mortgage with the same loan value and interest rate will have a higher monthly payment. But a 15-year loan will usually be the best deal, as long as you can afford the monthly payments. You will generally get a lower interest rate and pay less interest in total because you are paying off your mortgage much faster.

5/1 Adjustable Rate Mortgages

A 5/1 adjustable rate mortgage has an average rate of 3.99%, an addition of 24 basis points from a week ago. You will typically get a lower interest rate (compared to a 30 year fixed mortgage) with a 5/1 variable rate mortgage in the first five years of the mortgage. But you might end up paying more after that time, depending on the terms of your loan and how the rate adjusts to the market rate. For this reason, an adjustable rate mortgage can be a good option if you plan to sell or refinance your home before the rate changes. But if not, you may end up paying a much higher interest rate if market rates change.

Mortgage Rate Trends

While 2022 started off with low mortgage rates, they have recently seen a rise. There are two major factors at play here: rising inflation rates and a growing economy. That said, rates can always go up and down for a variety of reasons. The spread of the omicron, for example, kept rates relatively low throughout December and into the new year. Overall, rates are expected to rise in 2022, notably with the decision of the Federal Reserve to reduce its bond purchases and to increase interest rates.

We use information collected by Bankrate, which is owned by the same parent company as CNET, to track daily mortgage rate trends. This table summarizes the average rates offered by lenders across the country:

Average Mortgage Interest Rates

Product Rate Last week Change
30 years fixed 3.98% 3.77% +0.21
15 years fixed 3.34% 3.15% +0.19
30-year jumbo mortgage rate 2.85% 2.84% +0.01
30-year mortgage refinance rate 4.01% 3.76% +0.25

Rates as of February 11, 2022.

How to find the best mortgage rates

When you’re ready to apply for a loan, you can connect with a local mortgage broker or search online. When shopping for residential mortgage rates, consider your current goals and finances. A range of factors, including your down payment, credit score, loan-to-value ratio, and debt-to-income ratio, will all affect your mortgage rate. Having a higher credit score, higher down payment, low DTI, low LTV, or any combination of these factors can help you get a lower interest rate. Beyond the mortgage rate, factors such as closing costs, fees, discount points and taxes can also affect the cost of your home. Be sure to shop around with multiple lenders — like credit unions and online lenders in addition to local and national banks — to get a mortgage that’s right for you.

What is a good loan term?

An important thing to consider when choosing a mortgage loan is the length of the loan or the payment schedule. The most commonly offered mortgage terms are 15 and 30 years, although you can also find 10, 20 and 40 year mortgages. Mortgages are further divided into fixed rate and variable rate mortgages. For fixed rate mortgages, the interest rates are fixed for the term of the loan. Unlike a fixed rate mortgage, an adjustable rate mortgage’s interest rates are only fixed for a certain period of time (most often five, seven or 10 years). After that, the rate adjusts annually based on the current market interest rate.

An important factor to consider when choosing between a fixed rate and variable rate mortgage is how long you plan to stay in your home. If you plan to stay in a new home for the long term, fixed rate mortgages may be the best option. While variable rate mortgages can sometimes offer lower interest rates upfront, fixed rate mortgages are more stable over time. If you don’t plan on keeping your new home for more than three to ten years, an adjustable rate mortgage might get you a better deal. There is no best loan term as a general rule; it all depends on your goals and your current financial situation. It’s important to do your research and think about your own priorities when choosing a mortgage.


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