Today’s Mortgage Rates Move Lower | December 15, 2021

Today’s Mortgage Rates Move Lower

The mortgage market experienced a positive shift on December 15, 2021, with interest rates declining across most loan categories. This movement provides borrowers with an opportunity to explore favorable lending conditions. The average rate for a 30-year fixed-rate purchase loan decreased to 3.607%, while the 30-year refinance rate moved down to 3.797%. These rate reductions demonstrate the dynamic nature of the mortgage market and the importance of monitoring daily rate changes when planning your home purchase or refinancing strategy.

30-Year Fixed-Rate Mortgage Rates Today

The 30-year fixed-rate mortgage remains one of the most popular loan options among homebuyers due to its predictability and long-term stability. On December 15, 2021, this benchmark rate reached 3.607%, reflecting favorable market conditions for prospective borrowers.

• Current 30-year rate: 3.607%
• One-day change: Decrease of 0.019 percentage points
• One-month change: Increase of 0.046 percentage points

The 30-year mortgage provides borrowers with manageable monthly payments spread across three decades, making homeownership accessible to a broader range of buyers. The slight daily decrease indicates improving market conditions, though the monthly increase suggests rates have climbed gradually over the past month. This trend highlights the importance of locking in rates when favorable conditions present themselves.

15-Year Fixed-Rate Mortgage Rates Today

The 15-year fixed-rate mortgage appeals to borrowers seeking to build equity faster and pay less total interest over the life of the loan. On December 15, 2021, the 15-year purchase rate stood at 2.604%, while the refinance rate reached 2.719%.

• 15-year purchase rate: 2.604%
• 15-year refinance rate: 2.719%
• One-day change: Increase of 0.013 percentage points
• One-month change: Decrease of 0.026 percentage points

While a 15-year mortgage will be paid off faster and typically features a lower interest rate compared to a similar 30-year loan, making it the less expensive option over the full term, borrowers should carefully consider the trade-offs. The primary disadvantage is that monthly payments will be considerably higher, so this option may not be practical for all borrowers. Those with substantial income and minimal debt may find the 15-year option advantageous, while others might prefer the lower monthly obligations of a 30-year term.

Adjustable-Rate Mortgage (ARM) Rates Today

Adjustable-rate mortgages offer initial interest rates lower than fixed-rate options, providing attractive entry-level payments for borrowers who plan to sell or refinance before the rate adjustment period begins. On December 15, 2021, all ARM categories experienced rate decreases.

• 5/1 ARM rate: 2.183% (down)
• 7/1 ARM rate: 3.342% (down)
• 10/1 ARM rate: 3.4% (down)

The 5/1 ARM features a fixed rate for five years before adjusting annually, making it suitable for buyers expecting to relocate within five years. The 7/1 ARM provides a slightly longer fixed-rate period with moderate initial savings, while the 10/1 ARM offers the most extended fixed-rate protection before adjustment begins. ARM rates typically start lower than fixed-rate mortgages, but borrowers must understand the potential for significant payment increases once the adjustment period begins, particularly in rising rate environments.

VA, FHA, and Jumbo Loan Rates

Beyond conventional mortgage options, specialized loan products serve specific borrower categories and purchase scenarios. On December 15, 2021, these alternative mortgage products showed the following rates:

• 30-year FHA mortgage: 3.366% (down)
• 30-year VA mortgage: 3.447% (down)
• 30-year jumbo mortgage: 3.574% (down)

FHA loans serve first-time homebuyers and those with limited down payments, requiring only 3.5% down. VA loans exclusively benefit eligible military veterans and active-duty service members, offering competitive rates and favorable terms without down payment requirements. Jumbo loans, exceeding conventional loan limits, serve buyers purchasing higher-priced properties and typically require stronger credit profiles and larger down payments. All three categories experienced rate decreases on this date, providing favorable conditions across multiple lending segments.

Current Mortgage Refinance Rates

Refinancing presents existing homeowners with opportunities to improve loan terms or access home equity. The refinance market on December 15, 2021, displayed varied movement across different loan types.

30-Year and 15-Year Refinance Rates

• 30-year fixed-rate refinance: 3.797% (down)
• 15-year fixed-rate refinance: 2.719% (up)

The 30-year refinance rate moved lower, creating attractive opportunities for homeowners seeking to reduce their monthly obligations. The 15-year refinance rate increased slightly, potentially reflecting market adjustments in the shorter-term refinance segment. Homeowners should evaluate refinancing when rate reductions could justify closing costs and processing times.

ARM Refinance Options

• 5/1 ARM refinance: 2.46% (down)
• 7/1 ARM refinance: 3.197% (up)
• 10/1 ARM refinance: 3.918% (down)

ARM refinance options provide opportunities for borrowers seeking initial payment reductions before anticipated rate adjustments. The divergent movement across ARM categories suggests market segmentation, with shorter and longer-term ARMs responding differently to market conditions.

Understanding Money’s Mortgage Rate Methodology

Money’s daily mortgage rates provide comprehensive market data reflecting real lending conditions. These rates represent averages offered by more than 8,000 lenders across the United States, based on the most recent business day data available. For December 15, 2021, the data represents rates from December 14, 2021, the previous business day.

The rates reflect what a typical borrower with a 700 credit score might expect to pay, representing roughly the national average credit score. These estimates assume a 20% down payment and include discount points. This standardized approach provides consistent benchmarks for comparing rates over time and across different loan products.

It’s important to note that Freddie Mac’s weekly rates typically appear lower than Money’s daily rates because they measure rates offered to borrowers with higher credit scores. Borrowers with exceptional credit profiles may secure rates better than those reflected in Money’s average, while those with lower credit scores may face higher rates.

Comparing Mortgage Rate Options

Key Factors Influencing Mortgage Rates

Multiple economic factors influence daily mortgage rate movements. The Federal Reserve’s monetary policy decisions significantly impact lending rates, while inflation data, employment figures, and economic growth projections all contribute to rate fluctuations. On December 15, 2021, the broader economic environment supported rate decreases across most categories, reflecting market-wide sentiment regarding future economic conditions.

Individual borrower factors also affect available rates. Credit scores, down payment amounts, loan-to-value ratios, debt-to-income ratios, and employment history all influence the specific rates lenders offer. Borrowers should work to strengthen their financial profiles before applying to secure the most favorable rates possible.

Frequently Asked Questions

Q: What is the difference between purchase and refinance rates?

A: Purchase rates apply to new home loans, while refinance rates apply when homeowners replace existing mortgages. Refinance rates are typically slightly higher because lenders view refinancing as slightly riskier than new purchases, though rates move in similar directions.

Q: Should I choose a 15-year or 30-year mortgage?

A: The choice depends on your financial situation. The 15-year mortgage builds equity faster and costs less overall, but requires higher monthly payments. The 30-year mortgage offers lower monthly payments, providing greater flexibility. Calculate both scenarios based on your budget and long-term plans.

Q: What is an ARM, and is it right for me?

A: An Adjustable-Rate Mortgage features an initial fixed-rate period followed by periodic rate adjustments. ARMs work best for borrowers planning to sell or refinance before adjustment periods begin, or those who can afford potential payment increases.

Q: How often do mortgage rates change?

A: Mortgage rates change daily based on market conditions, economic data, and lender competition. While daily changes are often small, rates can shift significantly over weeks or months as economic conditions evolve.

Q: What credit score do I need to qualify for these rates?

A: Money’s rates assume a 700 credit score, roughly the national average. Borrowers with higher credit scores typically qualify for lower rates, while those with lower scores may face higher rates or stricter lending requirements.

Q: Can I lock in today’s rates?

A: Yes, lenders offer rate locks, typically lasting 30 to 60 days, protecting your rate from market increases during the application process. However, rate locks may include fees and prevent you from benefiting if rates decrease.

Q: What is the difference between FHA, VA, and conventional loans?

A: FHA loans require lower down payments (3.5%) and serve first-time buyers; VA loans are exclusive to military veterans with no down payment requirements; conventional loans typically require 5-20% down and serve borrowers with good credit and stable income.

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Author

medha deb

 

Medha Deb is an editor with a master's degree in Applied Linguistics from the University of Hyderabad. She believes that her qualification has helped her develop a deep understanding of language and its application in various contexts.

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