Interest rates slipped in February as bonds underwent a mild selloff. The resulting decline extended to popular savings and loan products, hurting savers but helping borrowers, especially anyone hunting for a mortgage.
The yield on the benchmark 10-year Treasury note plunged in early February but quickly recovered most of the decline. After touching a two-month low of 2.74% at the end of last month, interest rates on the 10-Year note were poised to close out February at 2.71%.
Although the best interest rates on popular savings products were unchanged or slipped, the drop was great news for anyone shopping for a mortgage, as rates fell significantly for the second straight month.
On balance, the cost of borrowing money fell to a greater degree than what banks pay for deposits. That helps borrowers more than banks, but savers lost some hard-won gains.
Check out our roundup of the best interest rates, current mortgage interest rates and more:
Best Interest Rates on Savings Products
Here are the best interest rates (shown in annual percentage yields) on some popular savings products (with a minimum deposit of less than $10,000, except for jumbo CDs) as of Feb. 26, according to Bankrate:
The national average interest rate on a money market account rose to make the annual percentage yield .41% as of Feb. 26, up from 0.4% a month ago, according to data from Bankrate.com (RATE).
- National Average Rate on Interest Checking Account: 0.48%, down from 0.51% a month ago
- Best APY on No-Fee Savings Account: 1% (First Trade Union Bank), no change for two months
- Best APY on 1-Year CD: 1.05% (GE Capital Bank [GE], $500 minimum), down from 1.1% a month ago
- Best APY on 3-Year CD: 1.45% (Intervest National Bank [IBCA], $2,500 minimum), no change for five months
- Best APY on 5-Year CD: 2.15% (Barclays [BCS], $0 minimum), down from 2.16% a month ago
- Best APY on 5-Year Jumbo CD: 2.2% (CIT Bank [CIT], $100,000 minimum), no change from a month ago
Current Mortgage Interest Rates
At the same time that savers were hit with rate pain, borrowers caught another break in the form of lower mortgage rates, which declined significantly for the second consecutive month. Here are the current mortgage interest rates (overnight national average) on popular loan products as of Feb. 26, according to Bankrate:
- 30-Year Fixed Mortgage: 4.3%, down from 4.33% a month ago
- 15-Year Fixed Mortgage: 3.32%, down from 3.38% a month ago
- 5/1 Adjustable-Rate Mortgage: 3.41%, down from 3.47% a month ago
- 30-Year Fixed Mortgage, Refi: 4.31%, down from 4.33% a month ago
- $30,000 Home Equity Line of Credit: 4.94%, up from 4.81% a month ago
- $30,000 Home Equity Loan: 6.23%, up from 6.1% a month ago