The 30-year mortgage saw interest rates decrease, but only by one basis point from 2.87% to 2.86% for the week ending Aug. 19, according to Freddie Mac’s Primary Mortgage Market Survey.
"Mortgage rates stayed relatively flat this week," Freddie Mac Chief Economist Sam Khater said. "Housing is in a similar phase of the economic cycle as many other consumer goods. While there is strong latent demand, low supply has caused prices to rise as shortages restrict the amount of sales activity that otherwise would occur."
With mortgage rates below 3%, many borrowers could get a lower interest rate by refinancing their home loan. There are several benefits to refinancing, like having the ability to tap into your home’s equity, removing private mortgage insurance (PMI) or lowering your monthly mortgage payments.
If you’re thinking of refinancing, consider using Credible. You can use Credible's free online tool to easily compare multiple lenders and see prequalified rates in as little as three minutes.
Mortgage rates show mixed results
The dip in the 30-year mortgage is also down from 2.99% at this time last year. Conversely, the 15-year fixed-rate increased slightly, from 2.15% last week to 2.16%. The 15-year mortgage was also down compared to last year, when it averaged 2.54%.
The five-year Treasury indexed hybrid adjustable-rate mortgage (ARM) dropped to 2.43%, down from 2.44% last week and 2.91% last year.
Whether current mortgage rates for various loan terms are increasing or decreasing, they are all down even from last year’s low rates. In order to ensure you get the best rate on your loan amount, you should shop multiple mortgage lenders. Visit Credible to compare multiple mortgage lenders at once and find the best mortgage lender for you.
Rates could increase soon, and this is why
Despite today's lows, experts predict mortgage rates could soon begin to increase before the end of the year. The minutes from the Federal Reserve’s July Federal Open Markets Committee meeting showed the Fed is considering tapering its assets this year. As one expert explains, this is the first step in a series that will lead to the Fed raising interest rates.
"The Freddie Mac fixed rate for a 30-year loan dropped one basis point to 2.86%," Realtor.com Senior Economist George Ratiu said. "The 10-year Treasury was flat early in the week due to weaker-than-expected retail sales, and mortgage rates responded to subsequent investor concerns about declining consumer sentiment and rising delta variant COVID cases.
"In addition, yesterday’s Federal Reserve minutes showed the central bank is considering tapering its asset purchases toward the end of 2021, because of concerns about inflation in light of the economic recovery," Ratiu said. "However, tapering Treasury purchases will be a likely first step, before cutting back on mortgage-backed securities. This means that we can expect rates to resume their mid-March climb above 3.0% closer to the end of the year, and into 2022."
If you want to refinance your interest rates before mortgage rates start to rise, visit Credible to get prequalified in minutes without affecting your credit score. Credible can help you compare mortgage lenders and discover the best refinance rates available so you can lower your monthly payments and meet your financial goals.
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