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The Latest on Texas Mortgage Rates

Current mortgage rates have stabilized at low levels. The Federal Reserve has been cutting the short-term rates as part of a measure to protect the economy from repercussions of the COVID-pandemic. That's good news for homebuyers seeking a mortgage or owners considering refinancing. Now is an ideal time to take advantage of historic lows to find more favorable terms. Let's break down what you need to know about current interest rates.

Mortgage rate outlook

Mortgage lenders use the 10-year Treasury as a guide to price their loans. These have reached record lows. Thanks to the coronavirus, mortgage rates have stayed near or at historic lows during this year. This trend is likely to continue until the economy recovers.

While the Federal Reserve does not directly impact mortgage rates, it does indicate general economic trends that play a role in homebuyer confidence. Since the Federal Reserve interest rates are trending down, chances are the mortgage rates will follow.

The Federal Reserve has said it won't raise its rate until it is confident our economy has weathered the recent events, the unemployment rate stabilizes, and inflation is normalized. It's going to take time to resurface from the recession brought on by the pandemic. Moving forward, we expect mortgage refinance to remain near their historic lows.

Getting ready for a home mortgage

Texas homebuyers applying for a home mortgage or refinance can strengthen their case for approval and speed up the process by making sure they submit a complete application with all necessary documentation.

For home buyers, having a Conditional Approval Letter is vital to convincing the sellers they are qualified and able to close the sale. It also strengthens your offer in a competitive environment.

Do shop around to take advantage of the most beneficial rates for your needs. Checking into various available programs helps you secure the right rate and terms for your home purchase.

Current mortgage rates are:

  • 30-Year Fixed: 2.750% (2.827% APR*)
  • 15-Year Fixed: 2.250% (2.408% APR*)  
  • 5/1 ARM 2.875% (3.088% APR*) 

*APR = Annual percentage rate. Figures shown are for illustrative purposes only and are subject to change. Based on rates effective 11/4/2020 for the purchase of a $500,000 home with 20% down payment and 760+ borrower credit score. Contact your Loan Officer for specific guidance. 
Fifteen-year fixed mortgage rates today hover around record lows. In Fall 2020, they set new record lows several times, encouraging owners to take advantage of the interest rates savings with these shorter-term loans. The 30-year fixed mortgage rates also continue hovering around record lows.

Getting ready to refinance

Refinance mortgage rates are also favorable for those looking to lower their interest and monthly payments. Before starting the process, know why you are considering refinancing your home. Common reasons why a homeowner seeks refinancing are:

  • To move from an adjustable-rate mortgage (ARM) to a fixed rate
  • To take advantage of an improved credit score to get better interest rates on a fixed mortgage
  • To change the rate and term of payments
  • To remove private mortgage insurance and reduce monthly payments

As you start looking at current Texas interest rates, make sure you know what kind of loan package works for you or why you are refinancing. You have many different options when you start looking at current interest rates.

Current Texas refinance rates

  • 30-Year Fixed: 2.875% (2.942% APR**)
  • 15-Year Fixed: 2.5000% (2.623% APR**)  
  • 5/1 ARM 2.875% (3.128% APR**)

**APR = Annual percentage rate. Figures shown are for illustrative purposes only and are subject to change. Based on rates effective 11/4/2020. Contact your Loan Officer for specific guidance.

These rates change on a day-to-day basis, so it's important to check back often when you are beginning to shop around for your financing and when you're ready to lock in your rate.

Take advantage of low mortgage rates today

Remember, these mortgage rates assume the most optimal possible scenario. Make sure you have a solid credit score, a lower debt-to-income ratio, and proof of funds. These rates also assume you are funding a primary residence and single-family home.

Lock in these mortgage rates now by talking to an expert at Big Home Life Loan Group. Ask about the mortgage or refinancing programs available to save you the most money on your home.

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