Today's mortgage and refinance rates: February 11, 2021 | Rates seesaw

Since last Thursday, mortgage and refinance rates have fluctuated, though they remain at historic lows. 

If your finances are in order, you may consider locking in a low rate on a fixed-rate mortgage today. It might be best to avoid an adjustable-rate mortgage, though. 

Your rate will alter periodically with an ARM. Darrin English, Senior Community Development Loan Officer at Quontic Bank, told Insider ARMs usually come with higher rates than fixed-rate mortgages these days. In the past, fixed rates were often higher than ARM rates — he said this isn’t the case now.

If you choose an ARM, you chance a future rate increase instead of securing a low rate with a fixed-rate mortgage. You might want to lock in a low rate while you can.

Mortgage rates for Thursday, February 11, 2021

Rates from Ad Practitioners LLC.

Rates for 15-year fixed mortgages have gone down by three basis points since last Thursday, while 30-year fixed rates have held steady. Adjustable-mortgage rates have climbed, though all rates remain at historic lows overall. 

We’re displaying the national average rates for conventional mortgages, which may be what you consider “normal mortgages.” You might qualify for a lower rate with a government-backed mortgage through the FHA, VA, or USDA.

As a whole, mortgage rates remain at all-time lows. Low rates are often an indicator of a faltering economy. As the US continues to face the economic fallout of the COVID-19 pandemic, mortgage rates will likely stay low. 

Refinance rates for Thursday, February 11, 2021

Rates from Ad Practitioners LLC.

Since last Thursday, refinance rates on fixed-rate mortgages have fallen marginally, while rates on adjustable-rate mortgages have increased. 

15-year fixed mortgage rates

If you get a 15-year fixed mortgage, it will take you 15 years to pay down your mortgage, and you’ll pay the same interest rate the whole time. 

A 15-year fixed mortgage is less expensive than a 30-year term. You’ll pay off the mortgage in half the time, and you’ll receive a lower interest rate to boot.  

However, you’ll dish out more per month with a 15-year term than with a 30-year fixed mortgage because it will take you half the time to pay off the same loan principal. 

30-year fixed mortgage rates

With a 30-year fixed mortgage, you’ll pay off your loan over three decades, and your interest rate will remain locked in for the entire term. 

A 30-year fixed mortgage comes with a higher interest rate than a 15-year term. Overall, it will cost you more in interest with a 30-year term than a shorter term because you’re paying a higher interest rate for more years.

On the other hand, you’ll pay less per month with a 30-year term than with a 15-year term because you’re splitting up your payments over an extended period. 

Adjustable mortgage rates

With an adjustable-rate mortgage, your rate will remain constant for a predetermined period and will fluctuate periodically afterward. A 7/1 ARM locks in your rate for seven years, then your rate will change once per year.

Although ARM rates are comparatively low now, you still might prefer a fixed-rate mortgage. The 30-year fixed rates are equivalent to or lower than ARM rates, so it could be an ideal time to secure a low rate with a fixed mortgage. This way, you won’t chance your rate increasing in the future with an ARM.

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

Top tips to get a low mortgage rate

It could be a great day to get a low mortgage rate. 

Whether you’re aiming to get a fixed-rate or adjustable-rate mortgage, all rates are at historic lows. Rates will likely stay low the remainder of 2021, if not longer. If you want to lock in the lowest rate, consider taking some of the following steps before applying:

• Increase your credit score. You can begin by making timely payments, paying off your debts, or allowing your credit to age. You’ll get a lower interest rate with a higher score, and many lenders will improve your rate with a score of at least 700. 
• Save more for a down payment. The minimum amount required for your down payment will depend on the type of mortgage you want. The larger your down payment, the more likely your lender is to offer an improved 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, and an improved ratio may result in a lower rate. To better your ratio, pay down debts or look for ways to boost your income. 

You can secure a low rate today if your finances are in order, but there’s no need to rush. 

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.

Laura Grace Tarpley is the associate editor of banking and mortgages at Personal Finance Insider, covering mortgages, refinancing, bank accounts, and bank reviews. She is also a Certified Educator in Personal Finance (CEPF). Over her four years of covering personal finance, she has written extensively about ways to save, invest, and navigate loans.

See the mortgage rates for Wednesday, February 10 »

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