Right now, a good mortgage rate for a 15-year fixed loan is in the low to medium range of -4%, while a good rate for a 30-year mortgage is generally in the mid-to high range of -5%. Any mortgage rate equal to or lower than 3% is an excellent mortgage rate. And the lower your mortgage rate, the more money you can save over the life of the loan. Over the past few years, mortgage rates have historically remained low between 3 and 4% for a 30-year fixed-rate mortgage, according to Freddie Mac.
A home affordability calculator can also give you an estimate of the maximum loan amount you can qualify for based on your income, debt-to-income ratio, mortgage interest rate, and other variables. When comparing mortgage offers, be sure to ask if the interest rate includes discount points. The APR takes into account ongoing costs, such as mortgage insurance, so it's usually higher than the interest rate. New home buyers can also benefit from the latest mortgage rates, as they are comparable to pre-pandemic rates.
Money's daily mortgage rate data shows that borrowers with 700 credit scores are finding rates around 6.5%. If you're worried that interest rates will fall after you set your rate, ask your lender for a “lower price.” Because mortgage rates are so individual to the borrower, the best way to find available rates is to get quotes from several lenders. If you're making a smaller down payment, have a lower credit score, or are applying for a non-compliant mortgage (or a giant loan), you may get a higher rate. If you want to get a bigger picture without talking directly to lenders, you can use the following tool to get a general idea of the rates that might be available to you.
It may be tempting to wait and see if interest rates will fall before setting the mortgage rate, but this may not be necessary. The best way to gain leverage is to compare prices and fees with several lenders to make sure you're getting the best deal and a fair offer. An APR represents the total cost of borrowing the money and includes the interest rate plus the fees associated with generating the loan. However, these rates are useful to provide you with a reference point that you can use when comparing loan offers, as they give you an idea of how the type of mortgage and the length of the repayment term affect your interest rate and the APR.
They let you know what the current mortgage rate situation is, but they may not reflect the rate that will be offered to you.