Today's mortgage and refinance rates: March 25, 2021 | Rates up

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Since last Thursday, most mortgage and refinance rates have gone up, though 7/1 ARM refinance rates have ticked down by 10 basis points. Rates remain low in general. 

If you’re looking for a mortgage or to refinance, you might want to get a fixed-rate mortgage instead of an adjustable-rate mortgage. Fixed-rate mortgages are a better deal than adjustable-rate mortgages currently because ARM rates start higher, and your rate might increase down the line. 

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Today’s mortgage rates: Thursday, March 25, 2021

Mortgage typeAverage rate todayAverage rate last weekAverage rate last month
15-year fixed2.7%2.61%2.55%
30-year fixed3.62%3.53%3.41%
7/1 ARM4.68%4.69%4.26%
10/1 ARM4.91%4.59%4.11%

Rates from Money.com

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Almost all mortgage rates have increased since last week, with rates on 15-year and 30-year fixed mortgages going up by nine basis points. Rates are up from this point last month, too. 

We’re showing you the average rates nationwide for conventional mortgages, which may be what you consider “normal mortgages.” You might get an improved rate with a government-backed mortgage through the FHA, VA, or USDA.

Today’s refinance rates: Thursday, March 25, 2021

Mortgage typeAverage rate todayAverage rate last weekAverage rate last month
15-year fixed3.03%2.94%2.89%
30-year fixed3.89%3.84%3.85%
7/1 ARM4.81%4.91%4.63%
10/1 ARM5.09%4.89%4.74%

Rates from Money.com

Click here to compare offers from refinance lenders »

Since last Thursday, refinance rates have risen — except for 7/1 ARM rates, which have dropped by 10 basis points. If you want a fixed mortgage, you could secure a refinance rate below 4% now.

Rates are still low overall. Low rates often signify a floundering economy. As the US continues to deal with the economic impact of the COVID-19 pandemic, rates will likely remain comparably low.

Ways to get a low mortgage rate

Since last Thursday, most fixed and adjustable mortgage rates are up, but they remain low in general. You could lock in a low mortgage rate today if your finances are in order. 

At the same time, you don’t need to be overly worried about a rate increase anytime soon, as rates will likely stay low for a while. There’s no need to hurry to get a mortgage or refinance. You have the chance to better your financial profile and get an improved rate. 

  • Improve your credit scoreYou can start by making payments on time, paying off your debts, or letting your credit age. You’ll get a more favorable interest rate with a higher score, and many lenders will lower your rate with a score of at least 700. 
  • Save more for a down paymentYou might be able to shell out as little as 3% if you’re aiming for a conventional mortgage, but the smallest amount will be contingent on which type of mortgage you want. You’ll likely 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. Most lenders want to see a ratio of 36% or less. To improve your ratio, pay down debts or look for ways to boost your income.
  • Go for a government-backed mortgage. If you’re eligible, you may think about a USDA loan  (aimed at low-to-moderate-income borrowers buying in a rural area), a VA loan (designed for military members and veterans), or an FHA loan (not designated for any particular group). Government-backed mortgages frequently come with more favorable interest rates than conventional mortgages. Additionally, down payments aren’t needed for USDA or VA loans.

You can lock in a low rate now if your finances are in order, but you don’t need to rush to get a mortgage or refinance if you’re not prepared.

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How do 15-year fixed mortgages work?

If you take out a 15-year fixed mortgage, it will take you 15 years to pay off your loan, and you’ll pay the same interest rate the entire time.

You’ll fork over more per month with a 15-year fixed mortgage than a 30-year fixed mortgage because you’ll pay off the same mortgage principal in half the time. 

On the plus side, a 15-year term will cost less than a longer term. You’ll pay off the mortgage years in fewer years, and you’ll get a lower interest rate as well.  

How do 30-year fixed mortgages work?

With a 30-year fixed mortgage, you’ll pay down your mortgage over three decades, and you’ll pay a locked-in interest rate for the whole term. A 30-year term comes with a higher interest rate than a shorter term.

A 30-year fixed mortgage will be more expensive than a 15-year fixed mortgage, as you’re paying a higher interest rate for an extended period — so your total interest paid will be higher. 

However, you’ll pay less per month with a 30-year term than with a shorter term, though, because you’re dividing up your payments over more years. 

How do ARMs work?

A fixed-rate mortgage secures your rate for your whole loan period. But with an adjustable-rate mortgage, you’ll pay a locked-in rate for the introductory period, then that rate will change periodically. A 7/1 ARM keeps your rate the same for seven years. Then your rate will vary annually.

Although ARM rates are relatively low now, you may still prefer a fixed-rate mortgage. The 30-year fixed rates are equal to or lower than ARM rates, so it could be a great opportunity to secure a low rate with a fixed mortgage. This way, you won’t risk a future rate increase with an ARM. 

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.

You can lock in a low rate today, but make sure you’re ready financially before you act. 

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

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 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.

See the mortgage rates for Wednesday, March 24 »

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