June 18, 2024—Rates Remain Fairly Steady – Forbes Advisor
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Today’s mortgage rates on a 30-year fixed mortgage is 7.41%, down 0.09 percentage point from the previous week.
Borrowers may be able to save on interest costs by going with a 15-year fixed mortgage, as they often have a lower rate than that of a 30-year, fixed-rate home loan. The average APR on a 15-year fixed mortgage is 6.63%. However, a 15-year mortgage means you are paying off the house in half the amount of time compared to a 30-year term, so your monthly payments will be higher.
If you want to refinance your existing mortgage, check out the average refinance rate.
Current Mortgage Rates for June 18, 2024
Source: Curinos
30-Year Mortgage Rates
Today’s average rate on a 30-year mortgage (fixed-rate) inched up to 7.41% from 7.37% yesterday. This time last week, the 30-year fixed was 7.50%.
The APR on a 30-year fixed is 7.43%. This time last week, it was 7.33%. APR is the all-in cost of your loan.
At an interest rate of 7.41%, a 30-year fixed mortgage would cost $693 per month in principal and interest (taxes and fees not included) per $100,000, according to the Forbes Advisor mortgage calculator. The total interest paid over the life of the loan will be about $149,527.
15-Year Mortgage Rates
Today, the 15-year mortgage rate sits at 6.60%, lower than it was yesterday. Last week, it was 6.73%.
The APR on a 15-year fixed is 6.63%. It was 6.53% this time last week.
A 15-year fixed-rate mortgage of $100,000 with today’s interest rate of 6.60% will cost $876 per month in principal and interest. Over the life of the loan, you would pay $57,761 in total interest.
Jumbo Mortgage Rates
The current average interest rate on a 30-year fixed-rate jumbo mortgage is 7.35%. Last week, the average rate was 7.47%.
If you lock in today’s rate of 7.35% on a 30-year, fixed-rate jumbo mortgage, you will pay $689 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 $5,167, and you’d pay around $1.11 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?
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.
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