Current 30-Year Mortgage Rates
Your mortgage rates are some of the smallest numbers you’ll deal with when investing in a new home — but they can often make the biggest difference. High mortgage rates won’t just increase your monthly payments; they can also dramatically increase the total cost of owning your home.
Unfortunately, you can’t always fully control your mortgage rates, and some lenders rely on higher rates to cover their internal costs.
The Low Rate Co. believes in doing things differently. We leverage the latest technology to eliminate the salesman. As a result, you’ll experience greater efficiency and affordability when you come to us for a loan.
We’re proud to offer some of the most competitive 30-year mortgage rates in the industry. Here’s what you can expect from mortgage rates today.
Why Your Mortgage Rate Matters
What does your mortgage rate tell you? Your mortgage interest rate tells you how much you’re paying your lender each year for the privilege of having the loan. A lower interest rate means a lower total cost on your investment.
Example: How Much Can Lower Interest Rates Save You?
Consider, for example, that you take out a 30-year loan for $300,000 with a fixed interest rate of 6.5%. Over the life of your loan, you’ll pay $382,633 in interest, with a combined total of $682,633 for your home. This translates into a monthly payment of $2,179.
Now, imagine that you reduce this 30-year mortgage by 1%. At 5.5%, you’ll pay a total of $313,212 in interest over the life of your loan. Your monthly payments would drop to $1,986.
So a 1% difference in your interest rate can save you nearly $200 each month and shave nearly $70,000 off the total cost of your home.
The Importance of Comparing Rates
It literally pays to shop around for the lowest interest rates. As you can see from our example, shopping around now can save you money long-term, and it can even give you some extra money each month to stretch your monthly budget.
The Low Rate Co. makes this a central part of our mission when helping you find a 30-year mortgage. Our advisors can work with you to find the most competitive rates, eliminating the need for you to go through the cost of mortgage brokers or financial salespeople. As an end result, you get the interest rate that fits your budget and puts your dreams of home ownership well within reach.
Current Mortgage Rates
30-year mortgage rates can vary based on a number of factors. Rates can fluctuate based on the overall economy, and they can also vary between individual lenders. But one of the biggest predictors of your mortgage rate is the actual type of loan you choose to pursue.
Home buyers have a number of options to choose from when buying a home. The terms and conditions of each of these options can vary, so it’s important to select the option that best fits your financial situation. Here are the current mortgage rates for the most common home loan types.
Conventional loans (sometimes called traditional loans) are among the most common loan types available today. And while home buyers have traditionally made a 20% down payment in order to qualify, it’s also quite feasible to purchase a home with as little as 3% down.
However, whenever you pay less than a 20% down payment, you’ll be required to pay for private mortgage insurance (PMI) as part of your monthly premiums. This is usually 0.2% to 2.25% of the home’s value and can be rolled into your monthly mortgage payments.
Currently, 30-year mortgage rates for a conventional loan are as follows:
- Bankrate Average: 6.970% (6.990% APR)
- U.S. Bank Average: 6.5% (6.64% APR)
Keep in mind that conventional loans typically offer the best terms to those with strong credit, usually requiring a score of 680 or higher. This may be prohibitive for certain types of home buyers who might take advantage of other loan programs.
Are you a current or former member of the U.S. military? VA loans are reserved for current service personnel, veterans, and their spouses. While the funding itself comes from a private lender, the loans are ultimately backed by the U.S. Department of Veterans Affairs (formerly referred to as the Veterans Administration).
VA loans offer a distinct advantage: you don’t have to make any down payment, nor will you have to make PMI payments. Additionally, qualifying home buyers can secure competitive rates and terms, which makes this program ideal for first-time home buyers.
Eligible applicants can expect 30-year mortgage rates as low as the following:
- Bankrate Average: 6.250% (6.380% APR)
- U.S. Bank Average: 6.5% (6.88% APR)
Just be aware that there are some additional fees that help fund this important program. This means that if you have enough savings to cover a 20% down payment, you might consider whether a conventional 30-year mortgage offers a greater financial advantage.
Backed by the Federal Housing Administration, FHA loans offer a low-cost alternative to those who don’t meet the requirements of other loan programs.
Home buyers can receive an FHA loan even if their credit score is as low as 500. An FHA loan requires you to make a down payment of at least 10%, though if your credit score is 580 or higher, you can pay as little as 3.5% down. However, once again, you’ll be expected to make monthly PMI payments if you make a down payment of less than 20%.
Current 30-year mortgage rates for an FHA loan are as follows:
- Bankrate Average: 6.150% (7.0% APR)
- U.S. Bank Average: 6.75% (7.93% APR)
FHA loans are a great way to secure a loan regardless of your financial history, which can place homeownership within easier reach.
Jumbo loans are less common but can become necessary for home buyers making purchases in high-cost communities. Jumbo loans are those that exceed the loan limits established by the Office of Federal Housing Enterprise Oversight (OFHEO) and are usually reserved for high-priced homes or those located in upscale neighborhoods.
This makes jumbo loans ideal for high-income home buyers looking for a lifestyle upgrade, but they can also benefit other buyers as well. For instance, if you’re moving out of necessity (such as for a new job), a jumbo loan can help you purchase property in a convenient geographic location, even if the property is in a higher price range.
Today’s 30-year mortgage rates for a jumbo loan are as low as:
- Bankrate Average: 6.970% (6.99% APR)
- U.S. Bank Average: 5.75% (5.894% APR)
These low rates make it easier than ever to pursue an upgrade, lowering the barrier for luxury homes and communities.
Factors that Influence Mortgage Rates Today
What causes mortgage rates to rise and fall? Mortgage rates are affected by a range of different factors, not all of which fall under the borrower’s — or even the lender’s — control. Here are the factors that influence mortgage rates today.
The U.S. Economy
The broader American economy has a direct impact on interest rates across the board, which has an impact on the mortgage industry. Similarly, rates of inflation and/or job growth can cause interest rates to rise and fall, which means that current mortgage rates can be a reflection of the nation’s broader financial health.
These factors may also affect the timing of when you purchase or sell a home since interest rates affect the price at which a property is sold. It’s also why it is important to partner with a lender who offers competitive rates and terms so that you can get the most from your mortgage.
The lowest mortgage rates go to those with good credit. If your credit score is 740 or above, you’ll typically qualify for the best rates and terms and have the broadest choice of financial products.
But don’t worry if your credit score isn’t this high. Borrowers still have many options, though your interest rate may be a bit higher. Even those with poor credit can still obtain financial assistance through loans guaranteed by the U.S. government, which means that purchasing a home is always an option.
Your loan-to-value ratio directly relates to your down payment. For example, if you purchase a $300,000 home and make a $60,000 down payment, you’ll be borrowing the remaining $240,000. This means that you’re borrowing 80% of the home’s total value, making your loan-to-value ratio 80%.
The higher your loan-to-value ratio, the more risk your lender assumes, which makes your interest rate creep higher. The best mortgage interest rates go to borrowers who are able to make a large down payment. But if you don’t have enough savings, don’t sweat it. You can still obtain affordable interest rates even if you can’t make a 20% down payment, and some loan options don’t require any down payment at all.
Your lender matters. Different lenders offer different mortgage rates based on their relative risk tolerance, and they can even adjust rates based on their overall customer volume. Again, that’s why it’s important to shop for the right lender who can give you the most favorable terms, especially when it comes to your mortgage interest rates.
Advantages of a 30-Year Mortgage
Home buyers commonly choose a 30-year term, though 15-year terms are also available. Why? Spreading your loan over 30 years has several distinct advantages, including:
Lower Monthly Payments
One of the best reasons to consider a 30-year mortgage is that this longer loan term ensures lower monthly payments. The shorter your loan term, the more money you’ll be expected to pay back each month. This allows your house payments to fit more comfortably into your overall budget and can make home ownership considerably more affordable.
Higher Purchasing Budget
Since your monthly payments are low, you’ll be able to afford more houses. A 30-year mortgage, therefore, allows you to increase your total purchasing budget, which can expand the number of houses that are available in your price range. A 30-year mortgage can be a great help to growing families who can afford a home with more space or in a better neighborhood.
Stability in Your Family’s Monthly Budget
Life happens. Most Americans need some cushion in their budget for the unexpected. High housing costs can take a bite out of your budget, which can be disastrous when you need money for an emergency. A 30-year mortgage lowers your monthly payment, giving you or your family some much-needed breathing room when life throws the unexpected your way.
Why Choose The Low Rate Co. for the Best Mortgage Rates Today?
The Low Rate Co. offers competitive rates by eliminating the middlemen, which include sales professionals and mortgage brokers.
Mortgage brokers can be helpful, of course. Brokerage firms serve as intermediaries between you and your lender and can help you weigh your options to make an informed financial decision. But mortgage brokers are simply not a necessary part of the loan process, and many of them charge a brokerage fee of about 1% of the total loan amount, a fee that’s often passed on to the borrower.
When you come to the Low Rate Co., you eliminate the added step of a mortgage broker. Instead, you’ll work with a licensed, trained advisor who can quickly assess your situation and guide you to the right loan program. And because our advisors don’t earn a commission, they’re committed to finding the program that fits your needs and your budget, which is how we’re able to connect our clients to some of the best rates in the industry.
If you’re in the market for a 30-year mortgage, then the team at the Low Rate Co. can work with you to find a solution that you can afford so that you can purchase the home of your dreams.
Got Five Minutes?
The process is so easy that applicants can get access to the lowest rates within minutes. Set up your Low Rate Co. account today, and let us open the door to your future.