Today’s Mortgage and Refinance Rates: November 5, 2021

Mortgage rates are low overall today, but they could increase soon. On Wednesday, the

Federal Reserve

announced that it will start slowing down its asset purchasing later this month.

The Fed has been aggressively buying assets like mortgage-backed securities to help the US economy during the COVID-19 pandemic, and this help has helped keep mortgage rates low. When the Fed slows down purchasing, mortgage rates could go up as a result — possibly as early as late November.

Mortgage rates today

Mortgage refinance rates today

Will mortgage rates go up in 2021?

Because the Federal Reserve announced that it will taper asset purchasing in late November, it’s possible that mortgage rates will go up in 2021. However, it’s more likely that rates will start to increase in 2022.

If you’re ready to buy a home soon, it may be a good time to lock in a low mortgage rate before rates rise. Apply for preapproval with a lender and it will lock in your rate for 60 to 90 days.

What is a fixed-rate mortgage vs. adjustable-rate mortgage?

In the past few weeks, fixed mortgage rates have been inching upward as adjustable rates drop. An adjustable-rate mortgage (ARM) could be a good deal depending on your situation.

Fixed-rate mortgages lock in your rate for the entire life of your loan. Adjustable-rate mortgages lock in your rate for the first few years, then your rate goes up or down periodically.

Because adjustable rates are starting low, they are worthwhile options if you plan on selling your home before the interest rate changes. For instance, if you get a 7/1 ARM and want to move before seven years, you won’t risk paying a higher rate later.

But if you want to buy a forever home, a fixed rate could still be a better fit. Fixed rates are relatively low, and you won’t chance your rate increasing in a few years.

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