Today’s 20-year mortgage rates offer best money-saving opportunity | Dec. 21, 2022

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Check out the mortgage rates for Dec. 21, 2022, which are up from yesterday. (Credible)

Based on data compiled by Credible, mortgage rates for home purchases have risen across all terms since yesterday.

30-year fixed mortgage rates: 6.500%, up from 5.875%, +0.625
20-year fixed mortgage rates: 5.875%, up from 5.750%, +0.125
15-year fixed mortgage rates: 5.875%, up from 5.375%, +0.500
10-year fixed mortgage rates: 5.875%, up from 5.750%, +0.125

Rates last updated on Dec. 21, 2022. These rates are based on the assumptions shown here. Actual rates may vary. Credible, a personal finance marketplace, has 5,000+ Trustpilot reviews with an average star rating of 4.7 (out of a possible 5.0).

What this means: Mortgage rates rose across all terms today, with 30-year rates rising more than half a point to hit 6.5%. Still, homebuyers who want a low interest rate and manageable monthly payment should consider a 20-year term: rates for this longer repayment term are more than half a point lower than rates for a 30-year mortgage. Comparing rates from multiple lenders can help buyers find the best possible deal for their unique financial situation.

To find great mortgage rates, start by using Credible’s secured website, which can show you current mortgage rates from multiple lenders without affecting your credit score. You can also use Credible’s mortgage calculator to estimate your monthly mortgage payments.

Based on data compiled by Credible, mortgage refinance rates have risen across all terms since yesterday.

30-year fixed-rate refinance: 6.500%, up from 5.875%, +0.625
20-year fixed-rate refinance: 5.875%, up from 5.750%, +0.125
15-year fixed-rate refinance: 5.875%, up from 5.375%, +0.500
10-year fixed-rate refinance: 5.875%, up from 5.750%, +0.125

Rates last updated on Dec. 21, 2022. These rates are based on the assumptions shown here. Actual rates may vary. With 5,000 reviews, Credible maintains an "excellent" Trustpilot score.

What this means: Mortgage refinance rates rose across all repayment terms today, bringing 30-year rates back above the 6% mark. Rates for shorter repayment terms also rose, but remain under 6%. With today’s increases, 20-year rates offer homeowners the best opportunity for greater interest savings. Homeowners who are considering a cash-out refinance to fund home improvement projects can still get a better rate than they would by using other financial products, like credit cards or personal loans.

How mortgage rates have changed over time

Today’s mortgage interest rates are well below the highest annual average rate recorded by Freddie Mac — 16.63% in 1981. A year before the COVID-19 pandemic upended economies across the world, the average interest rate for a 30-year fixed-rate mortgage for 2019 was 3.94%. The average rate for 2021 was 2.96%, the lowest annual average in 30 years.

The historic drop in interest rates means homeowners who have mortgages from 2019 and older could potentially realize significant interest savings by refinancing with one of today’s lower interest rates. When considering a mortgage refinance or purchase, it’s important to take into account closing costs such as appraisal, application, origination and attorney’s fees. These factors, in addition to the interest rate and loan amount, all contribute to the cost of a mortgage.

Are you looking to buy a home? Credible can help you compare current rates from multiple mortgage lenders at once in just a few minutes. Use Credible’s online tools to compare rates and get prequalified today.

Thousands of Trustpilot reviewers rate Credible "excellent."

How Credible mortgage rates are calculated

Changing economic conditions, central bank policy decisions, investor sentiment and other factors influence the movement of mortgage rates. Credible average mortgage rates and mortgage refinance rates reported in this article are calculated based on information provided by partner lenders who pay compensation to Credible.

The rates assume a borrower has a 740 credit score and is borrowing a conventional loan for a single-family home that will be their primary residence. The rates also assume no (or very low) discount points and a down payment of 20%.

Credible mortgage rates reported here will only give you an idea of current average rates. The rate you actually receive can vary based on a number of factors.

Factors that influence mortgage rates (and are in your control)

Many factors affect what mortgage interest rate you can qualify for, and some of them are within your control. Improving these factors could help you qualify for a lower interest rate.

Credit score — Generally, the lowest interest rates go to borrowers with the highest credit scores.
Debt-to-income ratio — DTI is a percentage that compares your total debts with your income. To calculate DTI, divide your monthly gross income by the total of all your monthly minimum debt payments. Generally, lenders prefer a DTI of 35% or less.
Down payment amount — Generally, lenders (and many sellers) look favorably on a higher down payment amount. If you put down less than 20% of the home’s purchase price, many lenders will require you to pay for private mortgage insurance, which protects the lender (not you) if you fail to repay the mortgage.
Home location/price — Interest rates can vary depending on what state you live in and where in the state you’re buying. Likewise, if you need to borrow a lot more than average (a jumbo loan) or very little, you may get a higher interest rate.
Repayment term — The lowest rates typically come with 10- or 15-year terms, while 30-year terms usually have the highest interest rates.

If you’re trying to find the right mortgage rate, consider using Credible. You can use Credible's free online tool to easily compare multiple lenders and see prequalified rates in just a few minutes.

Have a finance-related question, but don't know who to ask? Email The Credible Money Expert at moneyexpert@credible.com and your question might be answered by Credible in our Money Expert column.

As a Credible authority on mortgages and personal finance, Chris Jennings has covered topics that include mortgage loans, mortgage refinancing, and more. He’s been an editor and editorial assistant in the online personal finance space for four years. His work has been featured by MSN, AOL, Yahoo Finance, and more.