March 20, 2024—30-Year Mortgage Rates Increase, 15-Year Rates Steady – Forbes Advisor

Currently, the current average mortgage rate on a 30-year fixed mortgage is 7.50%, compared to 7.37% a week ago.

For borrowers who want to pay off their home faster, the average rate on a 15-year fixed mortgage is 6.69%, up 0.09 percentage point from the previous week.

Homeowners who want to lock in a lower rate by refinancing should compare their existing mortgage rate with current market rates to make sure it’s worth the cost to refinance.

Current Mortgage Rates for March 20, 2024

30-Year Mortgage Rates

Borrowers paid an average rate of 7.50% on a 30-year mortgage. This was up from the previous week’s rate of 7.37%.

Currently, the average annual percentage rate (APR) on a 30-year fixed-rate mortgage is 7.40%. This is higher than last week when the APR was 7.29%. The APR contains both mortgage interest and the lender fees to help give a more complete picture of loan costs.

To get an idea of how much you’ll pay: a $100,000 mortgage with a 30-year fixed-rate loan at the current average interest rate of 7.50% will cost you about $699 including principal and interest (taxes and fees not included) each month, the Forbes Advisor mortgage calculator shows. That’s around $151,791 in total interest over the life of the loan.

15-Year Mortgage Rates

Today, the 15-year mortgage rate is 6.69%, higher than it was yesterday. Last week, it was 6.60%.

The APR on a 15-year fixed is 6.64%. It was 6.55% this time last week.

At today’s interest rate of 6.69%, a 15-year fixed-rate mortgage would cost approximately $882 per month in principal and interest per $100,000. You would pay around $58,725 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 7.45%. Last week, the average rate was 7.35%.

If you lock in today’s rate of 7.45% 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 $5,217, and you’d pay around $1.13 million in total interest over the life of the loan.

How Much House Can I Afford?

Buying a house is a huge purchase and can put a big dent in your savings. Before you start looking, it’s important to calculate how much house you can afford and you’re willing to spend.

Not only do you want to consider your income and debt, but you also want to factor in emergency savings and any long-term financial goals such as retirement or college.

These are some basic financial factors that go into home affordability:

• Income
• Debt
• Debt-to-income ratio (DTI)
• Down payment
• Credit score

What’s an APR, and Why Is It Important?

The annual percentage rate, or APR, encompasses the mortgage interest rate and lender fees over the total life of the loan. It’s important because it can give homebuyers a more complete picture of total costs, not just the interest rate.

Comparing APR among lenders is a better way to see overall costs because it will show you everything from interest rate to fees.

How Are Mortgage Rates Determined?

Home loan borrowers can qualify for better mortgage rates by having good or excellent credit, maintaining a low debt-to-income (DTI) ratio and pursuing loan programs that don’t charge mortgage insurance premiums or similar ongoing charges that increase the loan’s annual percentage rate (APR).

Comparing rates from different mortgage lenders is an excellent starting point. You may also compare conventional, first-time homebuyer and government-backed programs like FHA and VA loans, which have different rates and fees.

For the most part, several economic factors influence the trajectory of rates for new home loans. The recent Federal Reserve rate hikes don’t directly cause mortgage rates to rise but have indirectly caused the interest rates for many long-term loans to increase. Rates are more likely to decrease when the Fed pauses or decreases its benchmark Federal Funds Rate.

Further, the inflation rate and the general state of the economy directly impact interest rates. High inflation and a strong economy typically signal higher rates. Cooling consumer demand or inflation may help rates decrease.

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.

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