May 3, 2024—Rates Remain Fairly Steady – Forbes Advisor

Today, the mortgage interest rate on a 30-year fixed mortgage is 7.66%, according to Curinos, while the average rate on a 15-year mortgage is 6.85%. On a 30-year jumbo mortgage, the average rate is 7.65%.

Current Mortgage Rates for May 3, 2024

30-Year Mortgage Rates

Borrowers will pay less in interest this week as the average rate on a 30-year mortgage is 7.66% compared to a rate of 7.73% a week ago.

The annual percentage rate (APR), which includes the interest and all of the lender fees, on a 30-year, fixed-rate mortgage is 7.68%.

If your mortgage is $100,000 and you have a 30-year, fixed-rate mortgage with the current rate of 7.66%, you will pay about $710 per month in principal and interest (taxes and fees not included), the Forbes Advisor mortgage calculator shows. That’s around $155,623 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 6.85%. This same time last week, the 15-year fixed-rate mortgage was at 6.94%.

On a 15-year fixed, the APR is 6.88%. Last week it was 6.88%.

A 15-year fixed-rate mortgage of $100,000 with today’s interest rate of 6.85% will cost $890 per month in principal and interest. Over the life of the loan, you would pay $60,283 in total interest.

Jumbo Mortgage Rates

The current average interest rate on a 30-year, fixed-rate jumbo mortgage is 7.65%— 0.04 percentage point down 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 7.65% will cost you $710 per month in principal and interest per $100,000. On a $750,000 jumbo mortgage, the monthly principal and interest payment would be approximately $5,321.

How To Calculate Mortgage Payments

Mortgages and mortgage lenders are often a part of purchasing a home, but it can be difficult to understand what you’re paying for—and what you can actually afford.

Using a mortgage calculator can help you estimate your monthly mortgage payment based on your interest rate, purchase price, down payment and other expenses.

Here’s what you’ll need in order to calculate your monthly mortgage payment:

• Home price
• Down payment amount
• Interest rate
• Loan term
• Taxes, insurance and any HOA fees

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

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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