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Today's Mortgage Rates -- October 23: Rates Hold Near Record Lows

Mortgage rates have repeatedly hit new record lows in recent weeks, and they remain very low today. In fact, mortgage rates for October 23 show that the average rate on 30-year-fixed rate loans remains below 3.00%, while the average rate on a 15-year loan has once again come in at under 2.50%. These rates present an opportunity for borrowers to secure a very affordable loan.

Here's what you need to know about today's mortgage rates.

Mortgage Type

Today's Interest Rate

30-year fixed mortgage

2.882%

20-year fixed mortgage

2.713%

15-year fixed mortgage

2.406%

5/1 ARM

3.448%

Data source: The Ascent's national mortgage interest rate tracking.

30-year mortgage rates

The average 30-year mortgage rate today is 2.882%, up .001% from yesterday's average rate of 2.881%. Your monthly principal and interest payment at today's average rate would total $415 per $100,000 borrowed, and total interest costs over the life of the loan would add up to $49,496 per $100,000 in mortgage debt.

Check out The Ascent's mortgage calculator to see what your monthly payment might be and how much your loan will ultimately cost. Also learn how much money you'd save by snagging a lower interest rate, making a larger down payment, or choosing a shorter loan term.

20-year mortgage rates

The average 20-year mortgage rate today is 2.713%, down 0.001% from from yesterday's average of 2.714%. At today's average rate, the monthly principal and interest payment per $100,000 borrowed would equal $540. Over the life of the loan, you would pay $29,682 in interest for each $100,000 in mortgage debt.

The average interest rate on a 20-year fixed rate mortgage is below the 30-year average rate, but as you can see you would face a higher monthly payment if you choose this loan. You'll pay more each month because you must repay your loan a decade sooner, but the total interest costs on your loan come in much lower because you're saving a decade of interest charges.

15-year mortgage rates

The average 15-year mortgage rate today is 2.406%, up 0.004% from from yesterday's average of 2.402%. For each $100,000 in mortgage debt you borrow, you'll pay $662 per month in principal and interest if you secure a loan at today's average rate. Over the life of your loan, your total interest costs would add up to $19,227 per $100,000 in debt.

As you can see, the rate is even lower on a 15-year loan, and total interest costs are much lower than with either the 20-year or 30-year loan. However, your monthly payments are much higher due to the fact you're paying off the loan so quickly.

5/1 ARMs

The average 5/1 ARM rate is 3.448%, up 0.055% from from yesterday's average of 3.393%. The average interest rate is above that of a 30-year fixed rate loan, which is not common, although rates have trended this way in recent months.

Usually, 5/1 ARMs offer a low starting rate, but that rate is only guaranteed for a limited time. In fact, the "ARM" stands for "adjustable rate mortgage," with the "5" signifying that the rate is locked in for five years before it begins to adjust once per year.

It can make sense to gamble on an ARM if you can score a lower rate up front and think that rates will go down or that you'll move or refinance before they could adjust upward. With rates at record lows, it's unlikely they'd go down from here. And since you can secure a fixed rate mortgage at a lower rate than the starting rate on an ARM, borrowers should steer clear of this type of loan in most cases.

Should I lock my mortgage rate now?

A mortgage rate lock guarantees you a certain interest rate for a specified period of time -- usually 30 days, though you may be able to secure your rate for up to 60 days. You'll generally pay a fee to lock in your mortgage rate, but that way, you're protected in case rates climb between now and when you actually close on your mortgage.

If you plan to close on your home within the next 30 days, then it pays to lock in your mortgage rate based on today's rates -- especially since they're so competitive. But if your closing is more than 30 days away, you may want to choose a floating rate lock instead for what will usually be a higher fee, but one that could save you money in the long run. A floating rate lock lets you secure a lower rate on your mortgage if rates fall prior to your closing, and while today's rates are still quite low, we don't know if rates will go up or down over the next few months. As such, it pays to:

  • LOCK if closing in 7 days
  • LOCK if closing in 15 days
  • LOCK if closing in 30 days
  • FLOAT if closing in 45 days
  • FLOAT if closing in 60 days

Before locking in, you should get rate quotes from at least three of the best mortgage lenders to ensure you're getting a loan at the most competitive possible rate.

Methodology

The Ascent team partners with market-leading data provider Optimal Blue to track the seven-day average of daily mortgage rates that actual borrowers are locking in nationwide. Learn more about our mortgage rates tracking methodology.

Today's Best Mortgage Rates
Chances are, mortgage rates won't stay put at multi-decade lows for much longer. That's why taking action today is crucial, whether you're wanting to
refinance and cut your mortgage payment or you're ready to pull the trigger on a new home purchase. Click here to get started by scanning the market for your best rate.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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