Mortgage Rates Are Up Sharply. Should Home Buyers Be Worried?

Will mortgage rates keep climbing? Here's what you need to know.

Last week, mortgage rates dipped slightly, giving buyers a bit of a reprieve. This week, rates are notably higher. In fact, we're seeing a sharp jump in fixed loan rates compared to yesterday.

Here's a summary of mortgage rates for March 16:

Data source: The Ascent's national mortgage interest rate tracking.

30-year mortgage rates

The average 30-year mortgage rate today is 4.358%, up from 4.295% yesterday. It won't be surprising to see the 30-year loan reach 4.5% by spring.

20-year mortgage rates

The average 20-year mortgage rate today is 4.054%, up from 3.927% yesterday. This is the first time we've seen the 20-year loan hit 4% in well over a year and a half.

15-year mortgage rates

The average 15-year mortgage rate today is 3.522%, up from 3.454% yesterday. Although the 15-year loan has been well above 3% for much of 2022, a jump to over 3.5% is significant.

5/1 ARMs

The average 5/1 ARM rate is 3.443%, which is actually a small drop from yesterday, when it sat at 3.468%. At this point, the 5/1 ARM gives you a lower rate than even a 15-year fixed loan. But the danger of signing an adjustable-rate mortgage is having your rate climb in time.

Will mortgage rates keep climbing?

We've seen a notable uptick in mortgage rates over the past few days alone. And that could be a sign of things to come.

The Federal Reserve's plans to raise interest rates could trickle down to consumer interest rates, driving mortgage rates upward even more. In fact, it wouldn't be surprising to see the 30-year loan creep upward toward 5% by the end of 2022.

Will higher mortgage rates result in buyer pullback? It might. But that could end up being a good thing in today's housing market, as less demand could drive home prices downward.

Meanwhile, given the way rates keep climbing, it's especially important to shop around with different mortgage lenders before signing a home loan. Gathering offers could help you reap some savings at a time when rates seem to be going nowhere but up.