March 14, 2024—Rates Remain Fairly Steady – Forbes Advisor
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The current average mortgage rate on a 30-year fixed mortgage is 7.37%, compared to 7.42% a week earlier.
For borrowers who want a shorter mortgage, the average rate on a 15-year fixed mortgage is 6.63%, up 0.03 percentage point from the previous week.
If you want to lock in a lower rate by refinancing, compare your existing mortgage rate to today’s refinance rates.
Current Mortgage Rates for March 14, 2024
30-Year Mortgage Rates
Today’s average rate on a 30-year mortgage (fixed-rate) remained at 7.37% from 7.37% yesterday. This time last week, the 30-year fixed was 7.42%.
The 30-year fixed mortgage APR is 7.29%. At this time last week, it was 7.22%. Here’s why APR is important.
According to the Forbes Advisor mortgage calculator, borrowers with a 30-year fixed-rate mortgage of 100,000 will pay $690 per month in principal and interest (taxes and fees not included) at today’s interest rate of 7.37%. You’d pay about $148,447 in total interest over the life of the loan.
15-Year Mortgage Rates
The average interest rate on a 15-year mortgage (fixed-rate) is 6.63%. This same time last week, the 15-year fixed-rate mortgage was at 6.60%.
On a 15-year fixed, the APR is 6.57%. Last week it was 6.45%.
With an interest rate of 6.63%, you would pay $878 per month in principal and interest for every $100,000 borrowed. Over the life of the loan, you would pay $58,039 in total interest.
Jumbo Mortgage Rates
The current average interest rate on a 30-year, fixed-rate jumbo mortgage is 7.36%— 0.05 percentage point up from last week. The 30-year jumbo mortgage rate had a 52-week APR low of 5.00% and a 52-week high of 10.50%.
A 30-year jumbo mortgage at today’s fixed interest rate of 7.36% will cost you $690 per month in principal and interest per $100,000. On a $750,000 jumbo mortgage, the monthly principal and interest payment would be approximately $5,173.
How To Calculate Mortgage Payments
One of the first steps in buying a house is budgeting. To get a general idea of how much owning a home will cost, start by using a mortgage calculator to crunch the numbers.
Just input the following data to get an idea of how much a house will cost:
- Home price
- Down payment amount
- Interest rate
- Loan term
- Taxes, insurance and any HOA fees
How Much House Can I Afford?
The first step on your homebuying journey should be to calculate affordability. You’ll want to find out how much you can afford based on things like income, debt and savings.
Here are a few important factors that go into home affordability:
- Income
- Debt
- Debt-to-income ratio (DTI)
- Down payment
- Credit score
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?
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.
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