Mortgage Rates Fall for Week of July 20

For those of you who've been sitting on the fence waiting for mortgage rates to go lower, this week brings good news. Rates for a 30 year fixed rate mortgage (FRM) fell from 5.42 percent to 5.39 percent. Rates for a 15 year FRM decreased from 4.90 percent to 4.81 percent, and rates for a 5/1 ARM decreased from 4.51 to 4.42 percent. Lower mortgage rates can increase your buying power and also offer lower monthly payments.

Mortgage Rates: To Wait or Not to Wait

If you're ready to buy or refinance, shopping online can give you a good idea of how much you can borrow and what it will cost. Pay close attention to points and closing costs, as these can reduce cash available for your down payment. Some closing costs can be negotiated, but third party vendor charges for title insurance, appraisals, document recording fees and escrow and attorney's closing fees are not often flexible. However, there is competition these days among title companies, and a few calls could save you some cash.

Into the Future: Mortgage Loans that Match Your Plans

If you're buying a home or living in one that you plan to sell within five years, a 5/1 ARM can provide an initial low fixed rate for the first five years. It's important to verify that the mortgage loans you're considering have no prepayment penalties if you're not very sure of remaining in your home for the penalty period (usually 1 to 3 years). If you're nearing retirement and can comfortably afford a higher monthly payment, getting a 15 year fixed rate mortgage can help you pay off your home sooner at a slightly lower interest rate. It's also possible to stick with a 30 year mortgage and pay extra each month. Then, if an emergency arises, you aren't committed to paying more each month.

Our live database of current mortgage rates can help you find the best mortgage rates in your area.