According to Freddi Mac’s most recent surveyed, there is currently a spread of 0.79 percent between the 15- and 30-year fixed rate mortgage benchmarks, which just so happens to be the largest spread since Freddie started tracking the 15-year mortgage 20 years ago; for comparison purposes, the average spread over that same time period has been only 0.47 percent.

Refinancing into a shorter-term mortgage isn't a strategy for everyone, however, choosing a shorter term usually means you'll get a better rate and you'll pay much less interest over the life of the loan -- but a shorter time frame ramps up monthly mortgage payments.

What is a 15-year fixed mortgage?

A 15-year fixed mortgage is a loan whose interest rate stays the same for the duration of the loan. For example, on a 15-year mortgage of $300,000 with an interest rate of 5.75%, the monthly payments would be about $3,097.90. So, the interest rate of 5.75% stays the same for the life of the loan.


In August, the number of applications for 15-year refinancing loans submitted nationwide through our website was up 29 percent from August 2010, while 30-year refinancing loans saw a 12 percent increase.

"It's all the trend right now. Most borrowers are asking about switching to a 15-year-loan. Everybody's in a mood now to get those mortgages paid off. They want to see an end to those payments, and that's what's driving it," said Kristine Marr, a senior loan officer with RPM Mortgage in Walnut Creek.

The 30-year fixed-rate mortgage has been a stalwart of today's real-estate market for homeowners looking to refinance. Now it's facing competition from the 15-year fixed-rate mortgage.

These mortgage rates have broken all records. This week, 30-year mortgages averaged 4.09%, with 0.7 point, unchanged from last week. This time a year ago, the rate was 4.37%.

10 year home equity loan rates are averaging 6.68%, down from last week’s average home equity loan rate of 6.73%.

15 year home equity rates are averaging 6.72%, up from last week’s average home equity loan rate of 6.62%.

Today’s mortgage rates on 30 year loans are averaging 4.46%, no change from yesterday’s average 30 year  mortgage rate. 15 year  mortgage rates are averaging 3.82%, unchanged from Saturday’s average  mortgage rate.

WASHINGTON — The average rate on a 15-year fixed mortgage has fallen to its lowest level in decades.

The rate for the popular refinancing option dropped to 3.54% this week from 3.66% last week. That's lowest since the mortgage buyer began tracking it in 1991.

15 Year Fixed Rate at 5.50%
$150,000 Loan Amount
Monthly principal and interest payment: $1,225.63
Total interest paid over the life of the loan: $70,612.53
Average monthly interest paid over the life of the loan: $196.15

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