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Today’s mortgage and refinance rates: May 3, 2021 | Rates go up

Today’s mortgage rates: Monday, May 3, 2021

Conventional rates from Money.com; government-backed rates from RedVentures.

Learn more and get offers from multiple lenders »

Today, mortgage rates are low overall. Fixed rates are much lower than adjustable rates. 

Rates for conventional mortgages (which may be what you consider “standard mortgages”) are low in general. But mortgages backed by the FHA and VA offer even better rates. Government-backed mortgages are great options if you qualify.

Today’s refinance rates: Friday, April 30, 2021

Conventional rates from Money.com; government-backed rates from RedVentures.

Compare offers from refinancing lenders »

Adjustable rates are higher than fixed rates, so you may want to refinance into a fixed-rate mortgage.

How to get a low mortgage rate

Although mortgage rates have ticked up since last week, in general, rates have been trending downward for a few weeks now. You may want to lock in a low rate today. 

You probably don’t need to rush if you’re not prepared to buy or refinance yet, as mortgage rates will likely remain low for at least a few months. You could use that time to better your financial situation and land a lower rate. Think about the following tips:

  • Boost your credit score by making timely payments or paying down debt. You can ask for a copy of your credit report to search for any mistakes that could be lowering your score.
  • Put down more for a down payment.You may be able to put down as little as 3% if you’re aiming for a conventional mortgage, but the smallest amount will depend on which type of mortgage you want. You’ll probably receive a better rate with a larger down payment.
  • Decrease your debt-to-income ratio. Your DTI ratio is the amount you pay toward debts each month, divided by your gross monthly income. To improve your ratio, pay down debts or look for ways to boost your income.

You can lock in a low rate now if your finances are in good shape.

Mortgage and refinance rates trends

Mortgage rate trends

Since last Monday, mortgage rates are up. All rates have gone up by at least eight basis points since last week, though all rates are down from this point last month.

Refinance rate trends

Across the board, refinance rates have increased since last Monday. 

15-year fixed-rate mortgages

With a 15-year fixed mortgage, you’ll pay a locked-in interest rate for your 15-year loan term. 

Your monthly payments will be higher with a 15-year fixed mortgage than a 30-year fixed mortgage because you’re paying off the same mortgage principal in fewer years. 

On the plus side, a 15-year term will be less expensive than a 30-year term. You’ll get a lower interest rate and you’ll pay off your loan in half of the time. 

30-year fixed-rate mortgages

If you take out a 30-year fixed mortgage, you’ll pay down your mortgage over 30 years and your interest rate with be set the entire period. A 30-year term has a higher interest rate than a shorter term.

You’ll pay less per month with a 30-year term than a shorter term because you’re dividing your payments over an extended period. 

However, you’ll pay more total interest with a 30-year fixed mortgage than a 15-year fixed mortgage because you’re paying a higher interest rate for more years. 

Adjustable-rate mortgages

An adjustable-rate mortgage, often known as an ARM, will lock in your rate for a set period. Then your rate will change regularly. A 7/1 ARM keeps your rate constant for seven years, then your rate will increase or decrease once per year. 

You may consider choosing a fixed-rate mortgage over an ARM, even though ARM rates are currently at all-time lows. The 30-year fixed rates are lower than ARM rates, so you might want to secure a low rate with a fixed mortgage. Additionally, you won’t risk a future ARM rate increase.

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

Government-backed mortgages

We’re also displaying rates for FHA and VA mortgages. These are two kinds of government-backed mortgages. Another type is a USDA mortgage, a less common loan for buyers who live in rural areas.

Government-backed mortgages are backed by government agencies. If you default on your payments, the agency pays the lender back. Because these mortgages are less risky than conventional mortgages, lenders have lower requirements for your credit score, debt-to-income ratio, or down payment. They also often have lower interest rates.

Government-backed mortgages can be great deals if you qualify. Here are your options:

  • FHA mortgage: This type of loan isn’t limited to a certain type of person. But it’s particularly useful if your credit score isn’t good enough to qualify for a conventional mortgage.
  • VA mortgage: You may qualify if you’re an active military member or veteran.
  • USDA mortgage: You’ll be eligible if you live in a rural area and fall under a certain income limit.

Mortgage and refinance rates by state

Check the latest rates in your state at the links below. 

Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Utah
Vermont
Virginia
Washington
Washington DC
West Virginia
Wisconsin
Wyoming

Laura Grace Tarpley is an editor 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.

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.

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