What Are Today's Mortgage Rates?

• Author: William Asher
• Posted: 2024-12-10

You probably have been wondering, "What are today's mortgage rates?" You can't blame them - interest rates are subject to a wide variety of factors, from inflation to the Federal Reserve. While these factors can affect interest rates, they also influence how lenders price mortgages, and therefore how much you'll pay for a mortgage. So how do you determine the best rate? Fortunately, the process is remarkably easy.

First, you'll want to compare various lenders' mortgage rates. You can get a good idea of what lenders are charging by comparing their website rates. Be aware, however, that these rates are samples of what borrowers may pay for different loan amounts. Some lenders will charge you discount points in order to lower the rate on your loan. The lower the P&I payment, the better. If you're a safe borrower, you can often get a lower rate than that.

Another factor that will determine your mortgage rate is your credit score. Lenders have settled on a three-digit credit score as the best predictor of timely payments. If your credit score is low, the lender will be less inclined to approve you. Therefore, a lower score means lower mortgage rates. Also, lenders consider the amount of down payment you have. If you have more money to put down, the lender will view your application more favorably. Finally, shorter-term loans tend to be lower-cost than 30-year loans.

Interest rates on mortgages are always changing, but the recent COVID-19 pandemic has caused rates to drop dramatically. The national average 15-year fixed mortgage rate fell to 2.2% in December 2020. The COVID-19 outbreak continued into early 2021, and the mortgage rate for a 15-year plan rose again in January. This trend is unlikely to end anytime soon, though. However, the rapid upward movement of mortgage rates has weighed on home sales in recent months. The numbers have fallen for five months in a row.

The latest mortgage rate analysis uses live mortgage-backed security (MBS) pricing. This data is the same data used by mortgage lenders. Fannie Mae bonds, which are closely linked to conventional mortgage rates, include the Home Affordable Refinance Program 2.0, the 3-percent down Conventional 97 loan, and the HomePath mortgage program. As you can see, these factors play a large role in the determination of your mortgage rate.

Interest rates are different for different types of loans, so it's essential to compare the two. For example, a 15-year fixed mortgage at 2.9% is still more affordable than a 30-year adjustable rate of 3.38%, but it's worth keeping in mind that the interest rate for such a loan will likely rise at a later date. For this reason, you'll want to shop around with a tool that can compare the rates of multiple lenders.

Generally, a good mortgage rate is around 3% - and this rate is the norm in most states. The best mortgage rates vary by region, loan type, and credit score. For example, a good mortgage rate for a fifteen-year fixed-rate home loan will probably be 2.5%. However, this figure can vary widely based on the mortgage type you're looking for and your credit score and down payment.