Latest news with #mortgageRates
Yahoo
2 days ago
- Business
- Yahoo
Mortgage and refinance interest rates today, May 31, 2025: Lower, with 15-year rates back under 6%
Mortgage rates are lower today, with the 15-year term dipping back into the hallowed Fives. According to Zillow, today's 30-year fixed mortgage rate slipped by three basis points to 6.84%, and the 15-year fixed rate fell by six basis points to 5.99%. The Federal Reserve's preferred measure of inflation dipped Friday, and expectations of a cut in short-term interest rates being delayed until September firmed. The bond market settled in as the month of May nears its end. The 10-year Treasury yield, a key indicator of mortgage rates, gained about a quarter point for the month. Read more: What determines mortgage rates? It's complicated. Here are the current mortgage rates, according to the latest Zillow data: 30-year fixed: 6.84% 20-year fixed: 6.54% 15-year fixed: 5.99% 5/1 ARM: 7.01% 7/1 ARM: 7.11% 30-year VA: 6.36% 15-year VA: 5.71% 5/1 VA: 6.37% Remember, these are the national averages and rounded to the nearest hundredth. Learn more: 8 strategies for getting the lowest mortgage rates These are today's mortgage refinance rates, according to the latest Zillow data: 30-year fixed: 6.90% 20-year fixed: 6.53% 15-year fixed: 6.15% 5/1 ARM: 7.43% 7/1 ARM: 7.24% 30-year VA: 6.38% 15-year VA: 5.84% 5/1 VA: 6.19% Again, the numbers provided are national averages rounded to the nearest hundredth. Mortgage refinance rates are often higher than rates when you buy a house, although that's not always the case. Use the mortgage calculator below to see how today's interest rates would affect your monthly mortgage payments. For a deeper dive, you can use Yahoo's free mortgage calculator to see how homeowners insurance and property taxes factor into in your monthly payment estimate. You even have the option to enter costs for private mortgage insurance (PMI) and homeowners' association dues if those apply to you. These details result in a more accurate monthly payment estimate than if you simply calculated your mortgage principal and interest. There are two main advantages to a 30-year fixed mortgage: Your payments are lower, and your monthly payments are predictable. A 30-year fixed-rate mortgage has relatively low monthly payments because you're spreading your repayment out over a longer period of time than with, say, a 15-year mortgage. Your payments are predictable because, unlike with an adjustable-rate mortgage (ARM), your rate isn't going to change from year to year. Most years, the only things that might affect your monthly payment are any changes to your homeowners insurance or property taxes. The main disadvantage to 30-year fixed mortgage rates is mortgage interest — both in the short and long term. A 30-year fixed term comes with a higher rate than a shorter fixed term, and it's higher than the intro rate to a 30-year ARM. The higher your rate, the higher your monthly payment. You'll also pay much more in interest over the life of your loan due to both the higher rate and the longer term. The pros and cons of 15-year fixed mortgage rates are basically swapped from the 30-year rates. Yes, your monthly payments will still be predictable, but another advantage is that shorter terms come with lower interest rates. Not to mention, you'll pay off your mortgage 15 years sooner. So you'll save potentially hundreds of thousands of dollars in interest over the course of your loan. However, because you're paying off the same amount in half the time, your monthly payments will be higher than if you choose a 30-year term. Dig deeper: 15-year vs. 30-year mortgages Adjustable-rate mortgages lock in your rate for a predetermined amount of time, then change it periodically. For example, with a 5/1 ARM, your rate stays the same for the first five years and then goes up or down once per year for the remaining 25 years. The main advantage is that the introductory rate is usually lower than what you'll get with a 30-year fixed rate, so your monthly payments will be lower. (Current average rates don't necessarily reflect this, though — in some cases, fixed rates are actually lower. Talk to your lender before deciding between a fixed or adjustable rate.) With an ARM, you have no idea what mortgage rates will be like once the intro-rate period ends, so you risk your rate increasing later. This could ultimately end up costing more, and your monthly payments are unpredictable from year to year. But if you plan to move before the intro-rate period is over, you could reap the benefits of a low rate without risking a rate increase down the road. Learn more: Adjustable-rate vs. fixed-rate mortgage First of all, now is a relatively good time to buy a house compared to a couple of years ago. Home prices aren't spiking like they were during the height of the COVID-19 pandemic. So, if you want or need to buy a house soon, you should feel pretty good about the current housing market. However, mortgage rates are unpredictable right now due to the political and economic climate. Experts don't think rates will plummet in 2025, so you might not want to base your decision on whether to buy strictly on interest rates. Recent news that home price gains are slowing, with predictions that house values may actually ease lower this year, can be part of your home buying decision. The best time to buy is typically whenever it makes sense for your stage of life. Trying to time the real estate market can be as futile as timing the stock market — buy when it's the right time for you. Read more: Which is more important, your home price or mortgage rate? Have questions about buying, owning, or selling a house? Submit your question to Yahoo's panel of Realtors using this Google form. According to Zillow, the national average 30-year mortgage rate is 6.84% right now. But keep in mind that averages can vary depending on where you live. For example, if you're buying in a city with a high cost of living, rates could be higher. Overall, mortgage rates are expected to remain mostly steady in 2025. They probably won't drop significantly anytime soon. Mortgage rates are down slightly today and lower than where they were when they last peaked in mid-January. In many ways, securing a low mortgage refinance rate is similar to when you bought your home. Try to improve your credit score and lower your debt-to-income ratio (DTI). Refinancing into a shorter term will also land you a lower rate, though your monthly mortgage payments will be higher.
Fox News
3 days ago
- Business
- Fox News
Invisible tax: Government debt is crushing your finances
Mortgage rates rose again this week, with the average 30-year fixed rate climbing past 6.8%. That's not just a post-pandemic hangover; it's a warning sign. Behind the scenes, rising government debt is putting steady upward pressure on borrowing costs. If your mortgage, car loan, or credit card payments are more expensive than they were a few years ago, you're not alone — and despite what you may have heard, it's not just because of inflation or Federal Reserve policy. The surge in federal borrowing is helping inflate interest rates across the board. If government debt had stayed at 2015 levels, the typical family could be paying $222 less per month on their mortgage. Go back to 2005 debt levels and the number jumps to $536. That's real money disappearing from household budgets not because of the jump in home prices, but because Washington can't stop borrowing. For years, economists puzzled over why interest rates kept falling. Aging populations, slower productivity, and foreign demand for American debt were all cited as reasons. One result was that Uncle Sam took advantage and racked up larger deficits and debt. After all, refinancing was affordable at low rates. Another was that Americans got used to lower monthly mortgage payments, auto loans, and other interest rate-related expenses. Now, we're grappling with interest rates that have surged and stayed stubbornly high. The change followed a torrent of unfunded federal spending in 2020 and especially 2021 which exploded the deficit, shook investor confidence in America's long-term fiscal stability, and caused bond markets to react to policymakers' fiscal bravado. My new research for the Mercatus Center at George Mason University, along with a growing body of economic literature, shows the debt itself is pushing up long-term interest rates — and by more than some experts are willing to admit. While broader economic changes and policy decisions also play roles, this particular problem is too big to ignore. Over time, as trillions of dollars in debt compound, the Treasury shells out hundreds of billions more in interest payments. It's not just a problem for Washington's balance sheet. It's a problem for yours. Economists have a term for what's happening: "crowding out." When the government borrows more, it competes with private borrowers for capital. And when two consumers want the same thing, the price usually goes up — in this case, the price of borrowing (interest rates). All kinds of important things become more expensive: mortgage payments, car loans, student loans, credit card debt. These are not abstract concerns. They determine whether plenty of families can afford to buy a home, send someone to college or buy a new car or truck. They determine whether someone can start or expand a business and provide more people with jobs. Take housing. Mortgage rates are now hovering near their highest levels in over 20 years. That's not because lumber or labor costs spiked, but because of the effects of federal borrowing. Student loan interest rates are tied to Treasury yields, which means college graduates are now repaying debt at the highest rates in almost two decades. Auto loan rates are rising too, pricing out lower-income consumers. For Americans with credit card debt (almost half of U.S. households carry a balance) the average interest rate is now around 20%, driven in part by the same upward pressure caused by growing federal debt. These debt-driven rate increases are an invisible tax on all of us. Families feel the squeeze every month. Businesses delay investments. Budding entrepreneurs face higher hurdles. Why aren't more economists talking about the problem? It's complicated. The Congressional Budget Office (CBO), for example, significantly underestimates the effect. Its latest projections assume long-term interest rates will stabilize at lower levels even as government debt as a share of the economy grows. But if debt pushes rates up more than the CBO predicts — as most empirical studies now show — then its rosy forecasts won't reflect how much the federal government will pay just in interest. Beyond our own households, there are consequences for the whole economy and government. Higher interest costs mean less money for education, infrastructure, or tax relief. They increase the risk of a debt spiral in which interest payments themselves become the fastest-growing part of the budget. Most people understand that the federal government's borrowing binge can't go on forever, and that it will burden future generations of taxpayers. But if you're between the ages of 19 and 99, the tax is probably already hitting you in some way each and every month. The cost of inaction isn't just abstract and long-term, it's concrete and already being felt. Just check your mortgage statement.
CNET
3 days ago
- Business
- CNET
Homebuyers See Lower Mortgage Rates: Current Mortgage Interest Rates on May 30, 2025
Check out CNET Money's weekly mortgage rate forecast for a more in-depth look at what's next for Fed rate cuts, labor data and inflation. It's been a bumpy few months for mortgage rates. Lingering inflation, the threat of a global trade war and growing recession worries have reduced affordable options for homebuyers. The average for a 30-year fixed mortgage is 6.94% today, a decrease of -0.02% over the last week. The average rate for a 15-year fixed mortgage is 6.10%, which is a decrease of -0.02% compared to a week ago. Given so much economic uncertainty, the Federal Reserve is adopting a wait-and-see approach when it comes to interest rate adjustments. After cutting borrowing costs three times last year, the central bank has held rates steady so far in 2025, extending its holding pattern for a third consecutive meeting on May 7. If President Trump eases some of his aggressive tariff measures or if the labor market deteriorates, it could prompt the Fed to resume easing interest rates, which would put downward pressure on bond yields and mortgage rates, said Logan Mohtashami, senior analyst at HousingWire. Average 30-year fixed rates are likely to remain stuck between 6.5% and 7% for the time being. Prospective homebuyers also continue to face the challenges of high home prices and limited inventory. When mortgage rates start to fall, be ready to take advantage. Experts recommend shopping around and comparing multiple offers to get the lowest rate. Enter your information here to get a custom quote from one of CNET's partner lenders. About these rates: Bankrate's tool features rates from partner lenders that you can use when comparing multiple mortgage rates. What's behind today's high mortgage rates? Mortgage rates are closely tied to the bond market, specifically the 10-year Treasury yield, which is sensitive to investors' expectations for inflation, labor data, changes to monetary policy and global measures like tariffs. Early forecasts called for a gradual decline in mortgage rates (potentially reaching 6% by the end of 2025), but concerns over a potential recession and uncertain trade policies have kept longer-term bond yields and mortgage rates in flux so far. "Bond yields will only drop if the rate of inflation continues to drop and the economy weakens," said Melissa Cohn, regional vice president at William Raveis Mortgage. "If inflation were to fire back up, that could cause rates to go up," Cohn said, noting that tariffs, by nature, are inflationary. Even if the economy slows and the Fed resumes interest rate cuts this summer, it will be difficult for mortgage rates to fall below 5.5% without the risk of a job-loss recession. For a look at mortgage rate movement in recent years, see the chart below. Mortgage rate forecast for 2025 Check out CNET Money's mortgage forecast for 2025. Here's a look at where some major housing authorities expect average mortgage rates to land. How can I choose a mortgage term? Each mortgage has a loan term, or payment schedule. The most common mortgage terms are 15 and 30 years, although 10-, 20- and 40-year mortgages also exist. With a fixed-rate mortgage, the interest rate is set for the duration of the loan, offering stability. With an adjustable-rate mortgage, the interest rate is only fixed for a certain amount of time (commonly five, seven or 10 years), after which the rate adjusts annually based on the market. Fixed-rate mortgages are a better option if you plan to live in a home in the long term, but adjustable-rate mortgages may offer lower interest rates upfront. 30-year fixed-rate mortgages The average interest rate for a standard 30-year fixed mortgage is 6.94% today. A 30-year fixed mortgage is the most common loan term. It will often have a higher interest rate than a 15-year mortgage, but you'll have a lower monthly payment. 15-year fixed-rate mortgages Today, the average rate for a 15-year, fixed mortgage is 6.10%. Though you'll have a bigger monthly payment than a 30-year fixed mortgage, a 15-year loan usually comes with a lower interest rate, allowing you to pay less interest in the long run and pay off your mortgage sooner. 5/1 adjustable-rate mortgages A 5/1 ARM has an average rate of 6.18% today. You'll typically get a lower introductory interest rate with a 5/1 ARM in the first five years of the mortgage. But you could pay more after that period, depending on how the rate adjusts annually. If you plan to sell or refinance your house within five years, an ARM could be a good option. Calculate your monthly mortgage payment Getting a mortgage should always depend on your financial situation and long-term goals. The most important thing is to make a budget and try to stay within your means. CNET's mortgage calculator below can help homebuyers prepare for monthly mortgage payments. Where can I find the best mortgage rates? Though mortgage rates and home prices are high, the housing market won't be unaffordable forever. It's always a good time to save for a down payment and improve your credit score to help you secure a competitive mortgage rate when the time is right. Save for a bigger down payment: Though a 20% down payment isn't required, a larger upfront payment means taking out a smaller mortgage, which will help you save in interest. Boost your credit score: You can qualify for a conventional mortgage with a 620 credit score, but a higher score of at least 740 will get you better rates. Pay off debt: Experts recommend a debt-to-income ratio of 36% or less to help you qualify for the best rates. Not carrying other debt will put you in a better position to handle your monthly payments. Research loans and assistance: Government-sponsored loans have more flexible borrowing requirements than conventional loans. Some government-sponsored or private programs can also help with your down payment and closing costs. Shop around for lenders: Researching and comparing multiple loan offers from different lenders can help you secure the lowest mortgage rate for your situation.
RNZ News
3 days ago
- Business
- RNZ News
Here's how much falling interest rates are helping first-home buyers
Photo: RNZ A drop in home loan rates over the past year could make a first-home mortgage about $800 a month cheaper. Westpac and Cotality, formerly Corelogic, have released their latest first-home buyers' report, which shows they remain a strong presence in the market. First-home buyers represent about 25 percent of all purchases. In Wellington, they are 36 percent, Hamilton 30 percent, Auckland 27 percent and Christchurch 26 percent. Typically, they were more like 21 percent or 22 percent of transactions. Westpac's calculations in the report show that a typical first-home buyer taking a 90 percent home loan on a purchase price of $700,000 would pay just over $3900 a month on a home loan rate of 5.59 percent. Rates have dropped further from that level. When rates were 7.6 percent, at the peak of the cycle, the loan would have cost $4697 a month or $794 more. Buyers in Auckland are at least $1024 a month better off, in Wellington $840, Christchurch $716 and Queenstown $1256. It is still more expensive than it was to service a mortgage at the peak of the market, when prices were highest but home loan rates were still lower. Wellington is the only place where it is cheaper now, at $227 less a month. Cotality chief property economist Kelvin Davidson said that was because it was where first-home buyer prices had fallen the furthest. He said about 75 percent of first-home buyer purchases at present were standalone houses, compared to 70 percent in 2023. The median price paid by first-home buyers this year was $700,000, down from $719,000 and a peak of what Davidson said was up to $740,000. But Westpac's data showed the average age for a first-home buyer is steadily climbing, at 37 in Auckland, 36 in Wellington and 35 in Christchurch. That was two or three years older than in 2019 and Davidson said it was likely significantly more than in decades past. The national average age was 36, compared to 34 in 2019. Westpac economist Satish Ranchhod said the higher prices paid by buyers in Auckland - the median for first-home buyers the city this year is $903,000 - meant it took people longer to save deposits there and interest rates could take up 40 percent of some buyers' income. Nationwide, the average was 33 percent. More affordable areas like Taranaki and Whanganui only required 20 percent or 25 percent. Ranchhod said first-home buyers were also now more likely to have children, which affected the size and location of the houses they chose. Davidson said the recent more sluggish housing market had been "hugely favourable" for first-home buyers because they could take their time to secure a property at a discount. "It's been a sustained period of relative strength for first-home buyers, the number of deals is going up too. "It's never easy but house prices are down from their peak, mortgage rates are now falling which has been helping." Many first-home buyers were able to get lending with smaller deposits, he said, and were using their KiwiSaver funds. "Renting will still be cheaper in lots of cases but the security of tenure offered by owning a property is still a strong motivation for people." Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
Fast Company
4 days ago
- Business
- Fast Company
Millennials show rising interest in buying homes despite high mortgage rates
Millennials (people born between 1981 and 1996) are far more interested in buying homes today than they were just six months ago. That makes the group the only generation whose interest in homeownership has increased since September 2024. However, these same people are tending to put off the investment due to sky-high mortgage rates. The new data comes from an online survey of 2,230 adults conducted by Six months ago, 15% of millennials said they were interested in buying a home. Now 23% are interested, according to the latest survey. Still, that doesn't mean more 29- to 44-year-olds are actually buying homes. In a press release, Laura Eddy, vice president of research and insights at noted how the desire to buy a home is being sidelined by soaring mortgage rates. 'Even though we found a change in millennial home-buying intent, the influence of mortgage rates cannot be overstated, with the vast majority of Americans, including millennials, prioritizing lower rates before committing to a purchase.' Eddy added: 'The lock-in effect is still very much in effect ' The survey also found that most Americans don't have plans to buy a home in the immediate future. Some 69% said they don't intend to go through with a home purchase over the next six months. And one-third of respondents said they have pushed back plans due to those high mortgage rates. But millennials and Gen Zers have delayed their plans at disproportionate rates, with more than half saying they've had to put off their plans to buy a home. Two-thirds of those surveyed by said mortgage rates have great influence over whether or not they will buy a home. Only 2% said they would even consider a home purchase with mortgage rates exceeding 6%; the threshold appears to be somewhere below 5% for 63% of respondents. (Meanwhile, the national average interest rate on a 30-year fixed mortgage is currently 6.95%, according to Bankrate.) 'Across much of our research we see a trend where potential homebuyers feel stuck when it comes to buying a home due to their current mortgage rate,' Hannah Jones, senior research analyst at said in the release. Jones continued, 'Mortgage rates on top of an insufficient supply of budget-friendly homes complicates the affordability picture for many homeowners, especially first-time homebuyers who do not have equity from their existing home to help offset mortgage rates.' Jones added that the experts at believe potential homebuyers are likely to get tired of waiting for change, and out of necessity may go forward with purchases even if they aren't totally satisfied with the rates. According to recent median home price listings, how much Americans need to earn to afford a home is growing exponentially. As of April 2024, they needed to earn $47,000 more per year to afford a home than they would have just six months prior.
