What Are the Lowest Mortgage Rates of All Time?
Now is a great time to buy/sell a home or even refinance a mortgage due to the current low mortgage rates. Several factors affect your mortgage rates, including:
Loan term
A 15-year fixed-rate mortgage incurs lower interest charges but has higher monthly payments. For instance, at 3%, a $200,000-home loan would cost you $49,000 interest, while a 30-year mortgage would cost $103,000 in interest charges.
Credit score
A credit score of more than 620 can help you get a lower-interest-rate loan. Try to wait 6-12 months before borrowing so that you can work on improving your score.
Some other factors that influence mortgage rates are discount points, loan amount, loan type, down payment, and the like.
The ongoing COVID-19 pandemic, which began in 2020, caused mortgage rates to plummet like never before. Based on data by Freddie Mac, here’s a look at the average mortgage rates for 30-year fixed mortgages from 1990 to 2019:
- 10.13 (1990)
- 9.25% (1991)
- 8.39% (1992)
- 7.31% (1993)
- 8.38% (1994)
- 7.93% (1995)
- 7.81% (1996)
- 7.60% (1997)
- 6.94% (1998)
- 7.44% (1999)
- 8.05% (2000)
- 6.97% (2001)
- 6.54% (2002)
- 5.83% (2003)
- 5.84% (2004)
- 5.87% (2005)
- 6.41% (2006)
- 6.34% (2007)
- 6.03% (2008)
- 5.04% (2009)
- 4.69% (2010)
- 4.45% (2011)
- 3.66% (2012)
- 3.98% (2013)
- 4.17% (2014)
- 3.85% (2015)
- 3.65% (2016)
- 3.99% (2017)
- 4.54% (2018)
- 3.94% (2019)
Several economists had predicted that the rates would go up in 2019. However, this prediction ended up being untrue. At 3.94%, the monthly payment for a home loan of $200,000 was $948 that year.
After the surprise drop in 2019, there was a belief that the rates wouldn’t go any lower. However, come July 2020, the rates dropped below 3% for the first time. The rates kept falling and hit a new low of 2.65% in January 2021. At 2.65%, the monthly payment for a $200,000-home loan is currently $806, excluding insurance and taxes.