Personal finance

Today’s mortgage and refinance rates: June 22, 2022 | Rates probably won’t decrease soon

Mortgage rates are nearing 6% today, according to Freddie Mac, having jumped over 0.50% from the week before.

Last Wednesday, the Fed said it would raise the federal funds rate by 75 basis points, or 0.75%. The central bank had initially signaled that it was planning to enact a 50 basis point increase. But last week’s Consumer Price Index report showed that inflation was accelerating again, so the Fed ultimately decided it needed to move more aggressively to combat price increases.

Mortgage rates aren’t directly influenced by the federal funds rate, but they often trend up or down in anticipation of Fed policy decisions and how those decisions might impact the broader economy. As the federal funds rate goes up, mortgage rates often follow suit.

The Fed has increased the federal funds rate a few times in 2022, and mortgage rates are now 2% higher than they were at the beginning of the year. It’s possible that rates will continue to inch upward over time.

Today’s mortgage rates

Today’s refinance rates

Mortgage calculator

Use our free mortgage calculator to see how today’s interest rates will affect your monthly payments:

Mortgage Calculator

%

$1,161 Your estimated monthly payment

  • Paying a 25% higher down payment would save you $8,916.08 on interest charges
  • Lowering the interest rate by 1% would save you $51,562.03
  • Paying an additional $500 each month would reduce the loan length by 146 months

By clicking on “More details,” you’ll also see how much you’ll pay over the entire length of your mortgage, including how much goes toward the principal vs. interest.

Are mortgage rates going up?

Mortgage rates started ticking up from historic lows in the second half of 2021, and may continue to increase throughout 2022.

In May, the Consumer Price Index rose by 8.6% year-over-year. The Federal Reserve has been working to get inflation under control, and plans to increase the federal funds target rate four more times this year, following increases in March, May, and June.

Though not directly tied to the federal funds rate, mortgage rates are often pushed up as a result of Fed rate hikes. As the central bank continues to tighten monetary policy to lower inflation, it’s likely that mortgage rates will remain elevated.

What do high rates mean for the housing market?

When mortgage rates go up, home shoppers’ buying power decreases, as more of their anticipated housing budget has to go toward paying interest. If rates get high enough, buyers can get priced out of the market completely, which cools demand and puts downward pressure on home price growth.

However, that doesn’t mean home prices will fall โ€” in fact, they’re expected to rise even more this year, just at a slower pace than what we’ve seen in the past couple of years.

What is a good mortgage rate?

It can be hard to know if a lender is offering you a good rate, which is why it’s so important to get preapproved with multiple mortgage lenders and compare each offer. Apply for preapproval with at least two or three lenders.

Your rate isn’t the only thing that matters. Be sure to compare both what your monthly costs would be as well as your upfront costs, including any lender fees.

Even though mortgage rates are heavily influenced by economic factors that are out of your control, there are some things you can do to help ensure you get a good rate:

  • Consider fixed vs. adjustable rates. You may be able to get a lower introductory rate with an adjustable-rate mortgage, which can be good if you plan to move before the intro period ends. But a fixed rate could be better if you’re buying a forever home because you won’t risk your rate going up later. Look at the rates your lender offers and weigh your options.
  • Look at your finances. The stronger your financial situation, the lower your mortgage rate should be. Look for ways to boost your credit score or lower your debt-to-income ratio, if necessary. Saving for a higher down payment also helps.
  • Choose the right lender. Each lender charges different mortgage rates. Picking the right one for your financial situation will help you land a good rate.

Laura Grace Tarpley, CEPF

Personal Finance Reviews Editor

Laura Grace Tarpley is a personal finance reviews editor at Insider. She edits articles about mortgage rates, refinance rates, lenders, bank accounts, and borrowing and savings tips for Personal Finance Insider. She is also a Certified Educator in Personal Finance (CEPF). She has written about personal finance for six years. Before joining the Insider team, she was a freelance finance writer for companies like SoFi and The Penny Hoarder, as well as an editor at FluentU. You can reach Laura Grace at ltarpley@insider.com. See below for some of her work. Today’s 30-year mortgage rates Here are the best mortgage lenders right now The pros and cons of paying off your mortgage early The best online high-yield savings accounts Chase checking accounts: Compare all 5 options Learn more about how Personal Finance Insider chooses, rates, and covers financial products and services ยป

Molly Grace

Mortgage Reporter

Molly Grace is a reporter at Insider. She covers mortgage rates, refinance rates, lender reviews, and homebuying articles for Personal Finance Insider. Before joining the Insider team, Molly was a blog writer for Rocket Companies, where she wrote educational articles about mortgages, homebuying, and homeownership. You can reach Molly at mgrace@insider.com, or on Twitter @mollythegrace.

Disclosure: This post may highlight financial products and services that can help you make smarter decisions with your money. We do not give investment advice or encourage you to adopt a certain investment strategy. What you decide to do with your money is up to you. If you take action based on one of our recommendations, we get a small share of the revenue from our commerce partners. This does not influence whether we feature a financial product or service. We operate independently from our advertising sales team. Read our editorial standards.

The Fed has increased the federal funds rate a few times in 2022, and mortgage rates are now 2% higher than they were at the beginning of the year. It’s possible that rates will continue to inch upward over time.

Source: https://www.businessinsider.com/personal-finance/best-mortgage-refinance-rates-today-wednesday-june-22-2022-6?op=1

Donovan Larsen

Donovan is a columnist and associate editor at the Dark News. He has written on everything from the politics to diversity issues in the workplace.

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