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The current average mortgage rate on a 30-year fixed mortgage is 7.09%, according to Curinos. The average rate on a 15-year mortgage is 6.26%, while the average rate on a 30-year jumbo mortgage is 7.13%.
Current Mortgage Rates for December 13, 2024
30-Year Mortgage Rates
Borrowers will pay more in interest this week as the average rate on a 30-year mortgage is 7.09% compared to a rate of 7.04% a week ago.
The annual percentage rate (APR), which includes the interest and all of the lender fees, on a 30-year, fixed-rate mortgage is 7.11%. The APR was 7.03% last week.
If your mortgage is $100,000 and you have a 30-year, fixed-rate mortgage with the current rate of 7.09%, you will pay about $671 per month in principal and interest (taxes and fees not included), the Forbes Advisor mortgage calculator shows. That’s around $141,616 in total interest over the life of the loan.
15-Year Mortgage Rates
Today’s 15-year mortgage (fixed-rate) is 6.26%, up 0.03 percentage point from the previous week. The same time last week, the 15-year, fixed-rate mortgage was at 6.23%.
The APR on a 15-year fixed is 6.29%. It was 6.18% a week earlier.
A 15-year, fixed-rate mortgage with today’s interest rate of 6.26% will cost $858 per month in principal and interest on a $100,000 mortgage (not including taxes and insurance). In this scenario, borrowers would pay approximately $54,405 in total interest.
Jumbo Mortgage Rates
On a 30-year jumbo, the average interest rate sits at 7.13%, higher than it was at this time last week. The average rate was 7.00% at this time last week.
Borrowers with a 30-year fixed-rate jumbo mortgage with today’s interest rate of 7.13% will pay $674 per month in principal and interest per $100,000. That means that on a $750,000 loan, the monthly principal and interest payment would be around $5,057 and you’d pay roughly $1.07 million in total interest over the life of the loan.
How To Calculate Mortgage Payments
Mortgages and mortgage lenders are often a necessary part of purchasing a home, but it can be tricky to understand what you’re paying for—and what you can truly afford.
Using a mortgage calculator can help you estimate your monthly mortgage payment based on your interest rate, purchase price, down payment and other expenses.
Here’s what you’ll need in order to calculate your monthly mortgage payment:
- Home price
- Down payment amount
- Interest rate
- Loan term
- Taxes, insurance and any HOA fees
What’s an APR, and Why Is It Important?
APR, or annual percentage rate, is a calculation that includes both a loan’s interest rate and a loan’s finance charges, expressed as an annual cost over the life of the loan. In other words, it’s the total cost of credit. APR accounts for interest, fees and time.
Since APRs include both the interest rate and certain fees associated with a home loan, the APR can help you understand the total cost of a mortgage if you keep it for the entire term. The APR will usually be higher than the interest rate, but there are exceptions.
How Are Mortgage Rates Determined?
Mortgage interest rates are determined by several factors, including some that borrowers can’t control:
- Federal Reserve. The Fed rate hikes and decreases adjust the federal funds rate, which helps determine the benchmark interest rate that banks lend money at. As a result, mortgage rates tend to move in the same direction with the Fed’s rate decision.
- Bond market. Mortgages are also loosely connected to long-term bond yields as investors look for income-producing assets—specifically, the 10-year U.S. Treasury Bond. Home loan rates tend to increase as bond prices decrease, and vice versa.
- Economic health. Rates can increase during a strong economy when consumer demand is higher and unemployment levels are lower. Anticipate lower rates as the economy weakens and there is less demand for mortgages.
- Inflation. Banks and lenders may increase rates during inflationary periods to slow the rate of inflation. Additionally, inflation makes goods and services more expensive, reducing the dollar’s purchasing power.
While the above factors set the base interest rate for new mortgages, there are several areas that borrowers can focus on to get a lower rate:
- Credit score. Applicants with a credit score of 670 or above tend to have an easier time qualifying for a better interest rate. Typically, most lenders require a minimum score of 620 to qualify for a conventional mortgage.
- Debt-to-income (DTI) ratio. Lenders may issue mortgages to borrowers with a DTI of 50% or less. However, applying with a DTI below 43% is recommended.
- Loan-to-value (LTV) ratio. Conventional home loans charge private mortgage insurance when your LTV exceeds 80% of the appraisal value, meaning you need to put at least 20% down to avoid higher rates. Additionally, FHA mortgage insurance premiums expire after the first 11 years when you put at least 10% down.
- Loan term. Longer-term loans such as a 30-year or 20-year mortgage tend to charge higher rates than a 15-year loan term. However, your monthly payment can be more affordable over a longer term.
- Residence type. Interest rates for a primary residence can be lower than a second home or an investment property. This is because the lender of your primary mortgage receives compensation first in the event of foreclosure.
What Is the Best Type of Mortgage Loan?
As you compare lenders, consider getting rate quotes for several loan programs. In addition to comparing rates and fees, these programs can have flexible down payment and credit requirements that make qualifying easier.
Conventional mortgages are likely to offer competitive rates when you have a credit score between 670 and 850, although it’s possible to qualify with a minimum score of 620. This home loan type also doesn’t require annual fees when you have at least 20% equity and waive PMI.
Several government-backed programs are better when you want to make little or no down payment:
- FHA loans. Borrowers with a credit score above 580 only need to put 3.5% down and applicants with credit scores ranging from 500 to 579 are only required to make a 10% down payment with FHA loans.
- VA loans. Servicemembers, veterans and qualifying spouses don’t need to make a down payment when the sales price is less than the home’s appraisal value. VA loan credit requirements vary by lender.
- USDA loans. Applicants in eligible rural areas can buy or build a home with no money down using a USDA loan. Moderate-income borrowers can qualify for a 30-year fixed-rate term through the Guaranteed Loan Program. Further, buyers with a very low or low income can receive a 33-year term and payment assistance is available through the agency’s Direct Loans program. Credit requirements differ by lender.
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.