February 29, 2024—Rates Remain Fairly Steady – Forbes Advisor
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Today, the current average mortgage rate on a 30-year fixed mortgage is 7.55%, according to Curinos. On a 15-year fixed mortgage, the average rate is 6.78%, and the average rate on a 30-year jumbo mortgage is 7.46%.
Current Mortgage Rates for February 29, 2024
30-Year Mortgage Rates
Today’s average rate on a 30-year mortgage (fixed-rate) slipped to 7.55% from 7.57% yesterday. At this time last week, the 30-year fixed was 7.53%.
The 30-year fixed mortgage APR is 7.50%. At this time last week, it was 7.45%. Here’s why APR is important.
At an interest rate of 7.55%, a 30-year fixed mortgage would cost $703 per month in principal and interest (taxes and fees not included) per $100,000, according to the Forbes Advisor mortgage calculator. You’d pay approximately $153,000 in total interest over the life of the loan.
15-Year Mortgage Rates
Today, the 15-year mortgage rate is 6.78%, higher than it was one day ago. Last week, it was 6.72%.
The APR on a 15-year fixed is 6.73%. It was 6.68% this time last week.
At today’s interest rate of 6.78%, a 15-year fixed-rate mortgage would cost approximately $886 per month in principal and interest per $100,000. You would pay around $59,543 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 7.46%. Last week, the average rate was 7.39%.
If you lock in today’s rate of 7.46% on a 30-year, fixed-rate jumbo mortgage, you will pay $696 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 $5,223, and you’d pay around $1.13 million in total interest over the life of the loan.
How to Calculate Mortgage Payments
To get an estimate of your mortgage costs, using a mortgage calculator can help.
Simply input the following information:
- Home price
- Down payment amount
- Interest rate
- Loan term
- Taxes, insurance and any HOA fees
How Are Mortgage Rates Determined?
Multiple factors affect the interest rate for a mortgage, including the economy’s overall health, benchmark interest rates and borrower-specific factors.
The Federal Reserve’s rate decisions and inflation can influence rates to move higher or lower. Although the Fed raising rates doesn’t directly cause mortgage rates to rise, an increase to its benchmark interest rate makes it more expensive for banks to lend money to consumers. Conversely, rates tend to decrease during periods of rate cuts and cooling inflation.
Home buyers can make several moves to improve their finances and qualify for competitive rates. One is having a good or excellent credit score, which ranges from 670 to 850. Another is maintaining a debt-to-income (DTI) ratio below 43%, which implies less risk of being unable to afford the monthly mortgage payment.
Further, making a minimum 20% down payment can help you avoid private mortgage insurance (PMI) on conventional home loans. If you can afford the larger monthly payment, 15-year home loans have lower rates than a 30-year term.
What Is the Best Type of Mortgage Loan?
Many home buyers are eligible for several mortgage loan types. Each program can have its own advantages:
- Conventional mortgage. A conventional home loan is ideal for borrowers with good or excellent credit to qualify for competitive rates. Additionally, making a minimum 20% down payment helps you waive private mortgage insurance premiums.
- FHA loan. An FHA home loan is best when applying with imperfect credit or a low down payment. You can put as little as 3.5% down with a credit score above 580. A minimum 10% down payment is necessary for credit scores ranging from 500 to 579.
- VA loan. Borrowers with a qualifying military background may prefer a VA loan for its flexibility. A down payment may not be required. While you pay a one-time funding fee, there are no ongoing mortgage insurance premiums or service fees.
- USDA loan. Applicants in eligible rural areas can buy or build a home with no down payment, although an upfront and annual guarantee fee applies. Additionally, income requirements apply and this program requires a moderate income or lower.
- Jumbo loan. Homebuyers in a high-cost-of-living area will need to apply for a jumbo loan when the loan amount exceeds the Federal Housing Finance Agency’s conforming loan limits. The limit in most municipalities is $726,200 in 2023.
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.
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