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Today, the mortgage interest rate on a 30-year fixed mortgage is 6.90%, according to Curinos, while the average rate on a 15-year mortgage is 6.18%. On a 30-year jumbo mortgage, the average rate is 6.95%.
Current Mortgage Rates for August 22, 2024
*Source: Curinos
30-Year Mortgage Rates
Today’s average rate on a 30-year, fixed-rate mortgage is 6.90%, which is 0.08 percentage point lower than last week.
The interest plus lender fees, called the annual percentage rate (APR), on a 30-year fixed mortgage is 6.92%.
To get an idea about how much you might pay in interest, consider that the current 30-year, fixed-rate mortgage of 6.90% on a $100,000 loan will cost $659 per month in principal and interest (taxes and fees not included), the Forbes Advisor mortgage calculator shows. The total amount you’ll pay in interest during the loan’s lifespan is $137,120.
15-Year Mortgage Rates
Today, the 15-year mortgage rate sits at 6.18%, higher than it was one day ago. Last week, it was 6.16%.
On a 15-year fixed, the APR is 6.21%. Last week it was 6.20%.
At today’s interest rate of 6.18%, a 15-year fixed-rate mortgage would cost approximately $854 per month in principal and interest per $100,000. You would pay around $53,640 in total interest over the life of the loan.
Jumbo Mortgage Rates
The current average interest rate on a 30-year fixed-rate jumbo mortgage is 6.95%. Last week, the average rate was 6.96%.
If you lock in today’s rate of 6.95% on a 30-year, fixed-rate jumbo mortgage, you will pay $662 per month in principal and interest per $100,000 in financing. That means that on a $750,000 loan, the monthly principal and interest payment would be around $4,967, and you’d pay around $1.04 million in total interest over the life of the loan.
How To Calculate Mortgage Payments
Get to know your budget before you look for a house. This will give you an idea of the type of house you can afford. A good place to start is by using a mortgage calculator to get a rough estimate.
Simply input the following information:
- Home price
- Down payment amount
- Interest rate
- Loan term
- Taxes, insurance and any HOA fees
What’s an APR, and Why Is It Important?
The APR, or annual percentage rate, includes the mortgage interest rate and lender fees over the life of the loan. This is an important figure because it gives borrowers a better snapshot of what they will pay for a mortgage as it shows the total cost of a mortgage if you keep it for the entire term.
How Are Mortgage Rates Determined?
Home loan borrowers can qualify for better mortgage rates by having good or excellent credit, maintaining a low debt-to-income (DTI) ratio and pursuing loan programs that don’t charge mortgage insurance premiums or similar ongoing charges that increase the loan’s annual percentage rate (APR).
Comparing rates from different mortgage lenders is an excellent starting point. You may also compare conventional, first-time homebuyer and government-backed programs like FHA and VA loans, which have different rates and fees.
For the most part, several economic factors influence the trajectory of rates for new home loans. The recent Federal Reserve rate hikes don’t directly cause mortgage rates to rise but have indirectly caused the interest rates for many long-term loans to increase. Rates are more likely to decrease when the Fed pauses or decreases its benchmark Federal Funds Rate.
Further, the inflation rate and the general state of the economy directly impact interest rates. High inflation and a strong economy typically signal higher rates. Cooling consumer demand or inflation may help rates decrease.
What Is the Best Type of Mortgage Loan?
Conventional home loans are issued by private lenders and typically require good or excellent credit and a minimum 20% down payment to get the best rates. Some lenders offer first-time home buyer loans and grants with relaxed down payment requirements as low as 3%.
For buyers with limited credit or finances, a government-backed loan is usually the better option as the minimum loan requirements are easier to satisfy.
For example, FHA loans can require 3.5% down with a minimum credit score of 580 or at least 10% down with a credit score between 500 and 579. However, upfront and annual mortgage insurance premiums can apply for the life of the loan.
Buyers in eligible rural areas with a moderate income or lower may also consider USDA loans. This program doesn’t require a down payment, but you pay an upfront and annual guarantee fee for the life of the loan.
If you come from a qualifying military background, VA loans can be your best option. First, you don’t need to make a down payment in most situations. Second, borrowers pay a one-time funding fee but don’t pay an annual fee as the FHA and USDA loan programs require.
Frequently Asked Questions (FAQs)
What is a good mortgage rate?
A competitive mortgage rate currently ranges from 6% to 8% for a 30-year fixed loan. Several factors impact mortgage rates, including the repayment term, loan type and borrower’s credit score.
How to get a lower mortgage interest rate?
Comparing lenders and loan programs is an excellent start. Borrowers should also strive for a good or excellent credit score between 670 and 850 and a debt-to-income ratio of 43% or less.
Further, making a minimum down payment of 20% on conventional mortgages can help you automatically waive private mortgage insurance premiums, which increases your borrowing costs. Buying discount points or lender credits can also reduce your interest rate.
How long can you lock in a mortgage rate?
Most rate locks last 30 to 60 days and your lender may not charge a fee for this initial period. However, extending the rate lock period up to 90 or 120 days is possible, depending on your lender, but additional costs may apply.