Personal finance

Today’s mortgage and refinance rates: May 11, 2021 | Rates stay low

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All mortgage and refinance rates have dropped since last Tuesday. Rates have decreased even more drastically since this time last month.

Low mortgage rates typically signify a struggling economy, so rates should stay low for the foreseeable future. Employment numbers and inflation need to consistently improve in the US for the economy to bounce back from the COVID-19 pandemic. The US didn’t create nearly as many jobs as expected in April, so it will take some time for the economy to recover. Until then, expect rates to stay low.

But if you’re ready to buy a home or refinance, it could be a great day to apply for preapproval and lock in a historically low mortgage rate.

Conventional rates from; government-backed rates from RedVentures.

Learn more and get offers from multiple lenders »

All mortgage rates are low today. The lowest is the 15-year fixed rate, which is 2.39%.

Rates for conventional mortgages, which you may consider “normal mortgages,” are already low right now. But government-backed mortgages through the FHA and VA usually pay even lower rates, depending on which term length you choose.

Conventional rates from; government-backed rates from RedVentures.

Compare offers from refinancing lenders »

Mortgage refinance rates tend to be higher than purchase rates, but today’s refinance rates are still low.

You can lock in low mortgage or refinance rates today, as all rates are at striking lows.

But if you’re not ready to buy or refinance yet, you likely don’t need to rush. Rates will probably stay fairly low for months. You have the opportunity to better your finances and get a lower interest rate. Think about the following steps:

  • Improve your credit score by making all your bill payments in a timely fashion. You can also consider paying down debts or letting your credit age.
  • Save up more for a down payment. The smallest amount you need for your down payment will be contingent on the type of mortgage you want. The bigger your down payment, the more probable your lender will give you a better interest rate.
  • Lower your debt-to-income ratio. Your DTI ratio is the amount you pay toward debts each month, divided by your gross monthly income. Many lenders want to see a DTI ratio of 36% or less. To better your ratio, pay down debts or look for ways to raise your income.

You can get a low rate today if you’re in a good financial situation, but you don’t need to hurry to get a mortgage or refinance if you’re not prepared.

Mortgage and refinance rates trendsMortgage rate trends

Mortgage rates are trending downward. All rates are down since last Tuesday, and they’ve decreased even more since April 11.

Refinance rate trends

Adjustable refinance rates have decreased a bit more significantly than fixed rates. But fixed rates are lower overall, so you probably want to refinance into a fixed-rate mortgage if possible.

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

A 15-year fixed mortgage will cost less than a 30-year fixed mortgage in the long run. You’ll pay off the mortgage in less time, and you’ll receive a better interest.

But your monthly payments will be higher with a 15-year term than a longer term, because you’re paying down the same mortgage principal in fewer years.

If you take out a 30-year fixed mortgage, it will take you 30 years to pay down your mortgage, and you’ll pay the same interest rate the whole time.

You’ll make smaller monthly payments with a 30-year term than a shorter term, because you are spreading your payments out over more years.

However, it will cost you more total interest with a 30-year fixed mortgage than a 15-year fixed mortgage since you’re paying a higher interest rate for an extended period.

An adjustable-rate mortgage, commonly referred to as an ARM, will set your rate for a predetermined period. Then your rate will fluctuate periodically. A 10/1 ARM keeps your rate constant for a decade, then your rate will vary annually.

Even though ARM rates are now at historic lows, you may still want a fixed rate instead. The 30-year fixed rates are lower than ARM rates, so it could be the right time to lock in a low rate with a fixed mortgage. Additionally, you won’t chance an ARM rate increase down the line.

If you’re considering getting an ARM, discuss with your lender what your rates would be if you chose a fixed-rate versus an adjustable-rate mortgage.

We’ve also provided rates for FHA and VA mortgages, two types of government-backed home loans.

Government mortgages are backed by government agencies. They’re less risky for lenders, because the agency compensates the lender if you default on payments. As a result, lenders usually offer lower rates than they do for conventional mortgages.

These mortgages also have more relaxed requirements when it comes to credit scores, debt-to-income ratios, or down payments.

Government-backed mortgages can be great deals if you’re eligible. Here are your options:

  • FHA mortgage: This type of loan isn’t limited to a certain type of person. But it’s especially useful if your credit score isn’t high enough to get a conventional mortgage.
  • VA mortgage: You may be eligible if you’re an active military member or veteran, or a family member of someone affiliated with the military.
  • USDA mortgage: You’ll qualify if you live in a rural area and earn a low to moderate income.

Mortgage and refinance rates by state

Check the latest rates in your state at the links below.

New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Rhode Island
South Carolina
South Dakota
Washington DC
West Virginia

About the authors

Laura Grace Tarpley is an editor at Personal Finance Insider, covering mortgages, refinancing, and lending. She is also a Certified Educator in Personal Finance (CEPF). Over her five years of covering personal finance, she has written extensively about ways navigate loans.

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.

Best Mortgage Rates Today: Wednesday May 12, 2021

Disclosure: This post is brought to you by the Personal Finance Insider team. We occasionally 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.

But if you’re ready to buy a home or refinance, it could be a great day to apply for preapproval and lock in a historically low mortgage rate.


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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