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Today’s biggest mortgage savings? 10-year terms at 6 percent | August 9, 2023

By Sarah Maroney
Published  August 9, 2023 1:25pm EDT
Personal Finance
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Our goal here at Credible Operations, Inc., NMLS Number 1681276, referred to as "Credible" below, is to give you the tools and confidence you need to improve your finances. Although we do promote products from our partner lenders, all opinions are our own.

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Check out the mortgage purchase rates for August 9, 2023, which are largely unchanged from yesterday. (Credible)

Based on data compiled by Credible, mortgage rates for home purchases have held steady for three key terms, while another has fallen since yesterday.

Rates last updated on August 9, 2023. 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: For the third day in a row, rates for 15-, 20-, and 30-year terms have remained unchanged. Rates for 20-year terms remained the day’s highest, at 7.875%. Additionally, rates for 15- and 30-year terms stayed the same at 6.125% and 7.625%, respectively. Meanwhile, rates for 10-year terms have edged down to 6%, today’s lowest purchase rate. Homebuyers interested in maximizing their interest savings should consider 10-year terms. Borrowers who would rather have a lower monthly payment should instead consider 30-year terms, as they have the lowest rate out of the two longer terms.

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 fallen across all key terms since yesterday.

Rates last updated on August 9, 2023. 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 have fallen across all key terms. Rates for 30-year terms have edged down to 6.75%, which is today’s highest rate. Meanwhile, rates for 10-year terms slightly decreased to 6%, the day’s lowest rate. Additionally, rates for 15- and 20-year terms have slightly lowered to 5.875% and 6.5%, respectively. Borrowers interested in a smaller monthly payment should consider 20-year terms, as their rates are a quarter of a percentage point lower than those of 30-year terms. Homebuyers who would rather save the most on interest should instead consider 10-year terms.

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 or refinance, 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. 

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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 700 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.

Fixed vs. adjustable-rate mortgages: How they affect interest costs

Interest rates for fixed-rate mortgages don’t change over the life of the loan, but tend to be higher than the initial interest rate for adjustable-rate mortgages, or ARMs. 

Initial interest rates for ARMs are typically lower than fixed-rate mortgages. But after the end of an introductory period, your interest rate will change — and it could increase significantly. Introductory periods can vary from several months to a year or a few years. After the introductory period, your interest rate will be based on an index your lender specifies. ARMs may or may not cap how much your interest rate can increase.

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.