January 3, 2023—Rates Trend Higher – Forbes Advisor

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Currently, the average rate on a 30-year fixed mortgage is 6.86%, compared to 6.72% a week ago.

For borrowers who want to pay off their home faster, the average rate on a 15-year fixed mortgage is 5.95%, up 0.20% from the previous week.

Homeowners who want to lock in a lower rate by refinancing should compare their existing mortgage rate with current market rates to make sure it’s worth the cost to refinance.

Related: Compare Current Mortgage Rates

Mortgage Rates for January 3, 2023

30-Year Fixed Mortgage Interest Rates

The average rate for the benchmark 30-year fixed-rate mortgage dropped to 6.86% from 6.87% yesterday. Last week, the 30-year fixed was 6.72%. Today’s rate is lower than the 52-week high of 7.41%.

The 30-year fixed mortgage APR is 6.88%. At this time last week, it was 6.74%. Here’s why APR is important.

At today’s interest rate of 6.86%, homebuyers with a 30-year fixed-rate mortgage of $100,000 will pay $656 per month in principal and interest (taxes and fees not included), the Forbes Advisor mortgage calculator shows. The total interest paid over the life of the loan will be around $136,134.

15-Year Mortgage Interest Rates

Today’s 15-year, fixed-rate mortgage is 5.95%, up 0.20% from the previous week. The same time last week, the 15-year, fixed-rate mortgage was at 5.75%. Today’s rate is higher than the 52-week low of 5.75%.

The APR on a 15-year fixed is 6.00%. It was 5.80% a week earlier.

A 15-year, fixed-rate mortgage with today’s interest rate of 5.95% will cost $841 per month in principal and interest on a $100,000 mortgage (not including taxes and insurance). In this scenario, borrowers would pay approximately $51,408 in total interest.

Jumbo Mortgage Rates

On a 30-year jumbo, the average interest rate is 6.92%, higher than it was at this time last week. The average rate was 6.80% at this time last week. The 30-year fixed rate on a jumbo mortgage is currently higher than the 52-week low of 6.58%.

Borrowers with a 30-year fixed-rate jumbo mortgage with today’s interest rate of 6.92% will pay $660 per month in principal and interest per $100,000. That means that on a $750,000 loan, the monthly principal and interest payment would be around $4,955, and you’d pay approximately $1,031,834 in total interest over the life of the loan.

5/1 ARM Rates

Today’s average interest rate on a 5/1 ARM is 5.49%, up 0.08% from a week earlier. In the past 52 weeks, the lowest 5/1 ARM rate was 5.40% and the high was 5.60%.

Borrowers with the current rate of 5.49% will spend $567 on principal and interest per month on a $100,000 loan.

How Much House Can I Afford?

Everyone’s budget and financial goals vary. How much house you can afford comes down to a number of factors, including what you earn and what you owe. You’ll also want to consider how much you want to save for retirement, school and other expenses down the road.

Here are a few basic factors that go into what you can afford:

  • Income
  • Debt
  • Debt-to-income ratio (DTI)
  • Down payment
  • Credit score

What’s an APR, and Why Is It Important?

The APR, or annual percentage rate, includes the mortgage interest rate and lender fees over the life of the loan. This is an important figure because it gives borrowers a better snapshot of what they will pay for a mortgage as it shows the total cost of a mortgage if you keep it for the entire term.

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