As of today, September 22, 2023, the benchmark 30-year fixed mortgage rate is 7.92%, FHA 30-year fixed is 7.80%, jumbo 30-year fixed is 7.15%, and 15-year fixed is 7.17%. These rates are not the teaser rates you may see advertised online and based on our methodology should be more representative of what customers could expect to be quoted depending on their qualifications. You can learn more about what makes our rates different in the Methodology section of this page.
Because mortgage rates and home loan terms can differ, it’s important to compare rates, closing costs and loan terms before taking out a home loan. We’ve compiled the best rates for the various types of mortgages, and common questions you may have to help you understand factors that might have affected mortgage rates in general and for your specific situation, including things like the interest rate changes projected by the Federal Reserve, upbeat economic news and the recent government credit rating downgrade.
IN THE NEWS
Freddie Mac released its weekly mortgage averages this morning, revealing a new 22-year high for 30-year rates. The Freddie Mac average jumped 14 basis points over the previous week to reach 7.23%, its highest level since June 2001.
Freddie Mac’s averages vary from the averages we publish due to being a weekly indicator that blends five previous days of rates, and which may include mortgage discount points. Investopedia’s averages instead provide a daily rate snapshot, and with only zero-point rates.
Today's Mortgage Rates
|FHA 30-Year Fixed||7.80%||8.04%|
|VA 30-Year Fixed||7.75%||7.91%|
|Jumbo 30-Year Fixed||7.15%||7.15%|
|Jumbo 15-Year Fixed||7.15%||7.15%|
|Jumbo 7/6 ARM||6.96%||7.06%|
|Jumbo 5/6 ARM||7.06%||7.06%|
|Best Mortgage Lenders|
|Rocket Mortgage (Quicken Loans)||Best Overall|
|CMG Financial||Best for First-Time Homebuyers|
|American Pacific Mortgage||Best for Customized Mortgages|
|loanDepot||Best for Cash-Strapped Borrowers|
|PNC Bank||Best for Jumbo Loan Borrowers|
|U.S. Bank||Best for Refinancing|
|Navy Federal Credit Union||Best for Military Borrowers|
|AimLoan||Best for Transparency|
Types of Mortgages
There numerous types of mortgages in the mortgage market, including those from private mortgage lenders as well as government backed loans purchased, guaranteed and securitized in the secondary mortgage market like those by the Federal Housing Administration (FHA) or the Federal National Mortgage Association (Fannie Mae).
Conventional mortgages can be fixed-rate with terms varying from 10 to 30 years or variable-rate with terms up to 10 years. Jumbo mortgage loans that exceed the Federal Housing Finance Agency's conforming loan limit of $726,200 for 2023, cannot be purchased, guaranteed, or securitized by Fannie Mae or the Federal Home Loan Mortgage Corporation (Freddie Mac). Jumbo loans offer the same fixed and variable rate terms as conventional mortage loans, though their interest rates are typically lower.
How to Use Our Mortgage Rate Table
Our mortgage rate table is designed to help you compare mortgage rates you’re being offered by lenders to know if they are better or worse than the best rates available. These rates are benchmark rates for those with good credit and not the teaser rates that make everyone think they will get the lowest rate available. Of course, your personal credit profile will be a significant factor in what rate you actually get quoted from a lender, but you will be able to shop for either new purchase or refinance rates with confidence.
How to Get the Best Mortgage Rates
There are several things to keep in mind when shopping for mortgage rates:
- Choose the right type of mortgage for your financial situation, which involves knowing your credit score and how much down payment you can make, determine the total cost you can afford in monthly payments using our mortgage calculator and estimate how long you plan to stay in your home. These factors can affect whether a conventional mortgage with a fixed-rate or variable-rate is a better fit as well as the term of the mortgage loan that makes the most sense.
- Make sure you look at national and local lenders to compare the best possible rates. Multiple lenders can often be accessed through a single independent loan officer who can provide rate quotes and help you compare loan terms, potential loan amount maximums, lender fees, closing costs, rate lock options, availability of buying basis points and private mortgage insurance options.
- Avoid any other type of consumer loan offers like opening a new credit card or personal loan prior to applying for a mortgage, as these can temporarily lower your credit score.
- Avoid applying for mortgages in multiple places as this can hurt your credit score. Instead, pull your credit report and get a keen picture of your credit history that you can share with potential lenders. Ask them to provide you with the rates based on that information as well as present other mortgage loan options that could include both fixed and variable rate mortgages. This way you preserve your credit score while getting the most accurate information for your credit profile.
- Use our rate table to help you identify whether loan offers that lenders are offering you a competitive rate based on your credit profile.
What Is a Good Mortgage Rate?
A good mortgage rate, which is usually represented as the lowest available rate for a 30-year fixed mortgage, will depend on the borrower. Lenders will advertise the lowest rate offered but yours will depend on factors like your credit history, income, other debts, and your down payment. For instance, a good mortgage rate for someone who has a low credit score tends to be higher than for someone who has a higher credit score.
It’s important to understand what will affect your individual rate and work towards optimizing your finances so you can receive the most competitive rate based on your financial situation
The Difference Between Interest Rate and APR
The advertised rate or nominal interest rate for a loan, whether for a mortgage, personal loan or credit card, is the basic cost of borrowing principal stated as a percentage. The annual percentage rate (APR), reflected as a percentage, is the total cost of the loan including the fees and all other costs associated with the loan, in this case a mortgage loan, such as origination charges and discount points. The APR, therefore, almost always calculates to a higher interest rate than the nominal interest rate since fees and other costs are factored into the rate including the interest rate.
How Do I Qualify for Better Mortgage Rates?
Qualifying for better mortgage rates can help you save money, potentially tens of thousands of dollars over the life of the loan. Here are a few ways you can ensure you find the most competitive rate possible:
- Raise your credit score: A borrower’s credit score is a major factor in determining mortgage rates. The higher the credit score, the more likely a borrower can get a lower rate. It’s a good idea to check your credit score to see how you can improve it, whether that’s by making on-time payments or disputing errors on your credit report.?
- Increase your down payment: Most lenders offer lower mortgage rates for those who make a larger down payment. This will depend on the type of mortgage you apply for, but sometimes, putting down at least 20% could get you more attractive rates.?
- Lower your debt-to-income ratio: Also called DTI, your debt-to-income ratio looks at the total of your monthly debt obligations and divides it by your gross income. Usually, lenders don't want a DTI of 43% or higher, as that may indicate that you may have challenges meeting your monthly obligations as a borrower. The lower your DTI, the less risky you will appear to the lender, which will be reflected in a lower interest rate.?
Are Mortgage Rates Rising or Falling?
Mortgage rates have been rising steadily since the Federal Reserve began raising the federal discount rate starting in March of 2022. Since that time the fed funds rate has risen by 525 basis points. Mortgage rates are not directly tied to the movement of the fed funds rate, however, and are determined by complex factors like interactions in the government bond market, specifically involving the yield on 10-year treasury bonds, Fed monetary policy in funding government-backed mortgages and competitive factors among mortgage lenders. So, it is impossible to say if mortgage rates will continue to rise or if they will remain steady or even begin to fall at any given point. Mortgage rates have reached record highs recently, though, and Fed monetary policy to address stubborn inflation for the rest of 2023 will likely have an influence on rates, if only indirectly.
What Is a Mortgage?
How Does a Mortgage Work?
Individuals and businesses use mortgages to buy real estate without paying the entire purchase price up front. The borrower repays the loan plus interest over a specified number of years until they own the property?free and clear. Most traditional mortgages are?fully-amortizing. This means that the regular payment amount will stay the same, but different proportions of principal vs. interest will be paid over the life of the loan with each payment. Typical mortgage terms are for 30 or 15 years.
How Big a Mortgage Can I Afford?
In general, homeowners can afford a mortgage that’s two to two-and-a-half times their annual gross income. For instance, if you earn $80,000 a year, you can afford a mortgage from $160,000 to $200,000. Keep in mind that this is a general guideline and you need to look at additional factors when determining how much you can afford such as your lifestyle.
First, your lender will determine what it thinks you can afford based on your income, debts, assets, and liabilities. However, you need to determine how much you’re willing to spend, your current expenses—most experts recommend not spending more than 28% of your gross income on housing costs. Lenders will also look at your DTI, meaning that the higher your DTI, the less likely you’ll be able to afford a bigger mortgage.?
Don’t forget to include other costs aside from your mortgage, which includes any applicable HOA fees, homeowners’ insurance, property taxes, and home maintenance costs. Using a mortgage calculator can be helpful in this situation to help you figure out how you can comfortably afford a mortgage payment.
What Is a Mortgage Rate?
A mortgage rate is the amount of interest determined by a lender to be charged on a mortgage. These rates can be fixed—meaning the rate is set based on a benchmark rate—for the duration of the borrower’s mortgage term, as in the case of a 15-year fixed rate mortgage, or variable based on the mortgage terms and current rates. The rate is one of the key factors for borrowers when seeking home financing options since it’ll affect their monthly payments and how much they’ll pay throughout the lifetime of the loan.?
How Are Mortgage Rates Set?
Mortgage rates are set based on a few factors, economic forces being one of them. For instance, lenders look at the prime rate—the lowest rate banks offer for loans—which typically follows trends set by the Federal Reserve’s federal funds rate, which is currently set at a range of 5.25% - 5.50%. Fed Funds rates are typically stated in this type of range which varies that rate by 0.25 percent.
The 10-year Treasury bond yield can also reveal market trends. If the bond yield goes up, mortgage rates tend to go up, and vice versa. The 10-year Treasury yield is usually the best standard to judge mortgage rates. That’s because many mortgages are refinanced or paid off after 10 years even if the norm is a 30-year fixed rate mortgage loan.?
Factors that the borrower can control is their credit score and down payment amount. Since lenders determine rates based on the risk they may take, borrowers who are less creditworthy or have a lower down payment amount may be quoted higher rates. In other words, the lower the risk, the lower the rate for the borrower.
Does the Federal Reserve Decide Mortgage Rates?
While the central bank doesn’t decide mortgage rates, it does influence the rate indirectly. The Federal Reserve helps to guide the economy by keeping inflation under control and encouraging growth. That means the decisions the Federal Open Market Committee makes in raising or lowering short-term interest rates may influence lenders to raise or lower theirs.?
Do Different Mortgage Types Have Different Rates?
Mortgage rates can be different depending on the loan type. For instance, fixed-rate mortgages tend to be higher than adjustable-rate ones. However, adjustable-rate mortgages tend to have lower rates during a predetermined time, then fluctuates as it adjusts to current market conditions.? Generally, the shorter the amount of time to repay the loan, better known as the loan term, the lower the rate. So, 30-year mortgages usually have higher rates than 15 or 10-year mortgage rates.
What Are Mortgage Points?
Also known as discount points, this is a one-time fee or prepaid interest borrowers purchase to lower the interest rate for their mortgage. Each discount point costs 1% of your mortgage amount, or $1,000 for every $100,000 and will lower the rate by a quarter of a percent, or 0.25. For example, if the interest rate is 4%, purchasing one mortgage point will reduce the rate to 3.75%, which can save a significant amount of interest expense in your monthly mortgage payment and over the life of the loan.
What are the best mortgage rates right now?
According to Freddie Mac, the latest average 30-year mortgage rate is 7.12%. The previous week's level of 7.23% marked a 22-year high and is the highest level recorded since June 2001.Depending on where you live in the country you may be able to get a lower rate if you have excellent credit, as the Freddie Mac figure is an overall average. Rates are also lower on different types of mortgages such as those with larger loan amounts, shorter terms or adjustable rates.
When Will Mortgage Rates Go Down?
Mortgage rates, which are tied to the 10-year treasury bond, will not go down until the Federal Reserve begins to ease monetary policy by lowering the federal funds rate. Mortgage rates have gone up dramatically in the past year as the Fed has raised the fed funds rate by over 5 percentage points to combat inflation. Once inflation reaches the Fed's target rate of 2% they may begin to lower the fed funds rate, which will in turn begin to lower mortgage rates.
Will mortgage rates go down 2023?
While it is possible that mortgage rates will begin to moderate at some point later this year it is probably unlikely given that the Federal Reserve is still considering raising the Federal Funds rate in September or November depending on economic conditions. If the Fed doesn't raise rates they will likely leave them unchanged, which means mortgage rates will probably remain static rather than going down in the fourth quarter.
How Much Will I Need for a Down Payment?
The minimum you’ll need to put down will depend on the type of mortgage. Many lenders require a minimum of 5% to 20%, whereas others like government-backed ones require at least 3.5%. The VA loan is the exception with no down payment requirements.?
Generally, the higher your down payment, the lower your rate may be. Homeowners who put down at least 20% will be able to save the most.?
What is the Best Way to Get the Lowest Mortgage Rate
The best way to ensure you qualify to the lowest mortgage rates is to know and optimize your credit score through keeping your debt to income level as low as possible, preferably below 28%, not applying for any other types of loans in the six months preceding any mortgage applications, paying all your bills on time and making sure there are no mistakes on your credit report. Making a down payment of at least 20% (keeping your loan-to-value at least to 80%) is also an important factor in qualifying for a good mortgage rate. Then, shopping around with different types of lenders, both online and those in your area, will also help to secure the lowest possible rate.
In order to assess mortgage rates, we first needed to create a credit profile. This profile included a credit score ranging from 700 to 760 with a property loan-to-value ratio (LTV) of 80%. With this profile, we averaged the lowest rates offered by more than 200 of the nation’s top lenders. As such, these rates are representative of what real consumers will see when shopping for a mortgage.?
The same credit profile was used for the best state rates map. We then found the lowest rate currently offered by a surveyed lender in that state.?
Keep in mind that mortgage rates may change daily and this average rate data is intended to be for informational purposes only. A person’s personal credit and income profile will be the deciding factors in what loan rates and terms they are able to get. Loan rates do not include amounts for taxes or insurance premiums and individual lender terms will apply.?
Freddie Mac. “The 30-Year Fixed-Rate Mortgage Reaches its Highest Level in Over Twenty Years”, Aug. 17, 2023.
U.S. Department of Veterans Affairs. "Ten Things Most Veterans Don’t Know About VA Home Loans."
When to Buy a Home Based on Mortgage Rates
What Is a Mortgage? Types, How They Work, and Examples
How to Shop for a Mortgage
5 Things You Need to Be Pre-Approved for a Mortgage
17 Mistakes First-Time Homebuyers Should Avoid
Got a Good Mortgage Rate? Lock It in!
How Mortgage Points Work
How Much Money Do I Need to Put Down on a Mortgage?
Understanding Different Mortgage Rates
Fixed vs. Adjustable-Rate Mortgage: What's the Difference?
Adjustable-Rate Mortgage: What Happens When Interest Rates Go Up
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Best 30-Year Mortgage Rates for 2023
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Best 20-Year Mortgage Rates
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Best 10-Year Mortgage Rates
Best Jumbo Mortgage Rates
Understanding Mortgage Closing Costs
Watch Out for ‘Junk’ Mortgage Fees
How To Negotiate Your Closing Costs
How to Lower Refinance Closing Costs
What Are the Main Types of Mortgage Lenders?
Applying to Mortgage Lenders: How Many Are Necessary?
Mortgage Brokers: Advantages and Disadvantages
What to Know When Dealing With Mortgage Loan Officers and Brokers
How Rocket Mortgage (Formerly Quicken Loans) Works
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