The current average mortgage rate on a 30-year fixed mortgage is 7.48%, according to Curinos. The average rate on a 15-year mortgage is 6.71%, while the average rate on a 30-year jumbo mortgage is 7.46%.

Current Mortgage Rates for June 12, 2024

LOAN TERM RATE CHANGE RATE LAST WEEK
30-Year Mortgage Rate
7.48%
+0.05
7.43%
15-Year Fixed Rate
6.71%
+0.07
6.64%
30-Year Jumbo Mortgage Rate
7.46%
+0.04
7.42%
Source: Curinos

30-Year Mortgage Rates

Borrowers paid an average rate of 7.48% on a 30-year mortgage. This was up from the previous week’s rate of 7.43%.

Currently, the average annual percentage rate (APR) on a 30-year fixed-rate mortgage is 7.50%. This is higher than last week when the APR was 7.38%. 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 7.48% will cost you about $698 including principal and interest (taxes and fees not included) each month, the Forbes Advisor mortgage calculator shows. That’s around $151,274 in total interest over the life of the loan.

15-Year Mortgage Rates

Today’s 15-year mortgage (fixed-rate) is 6.71%, up 0.07 percentage point from the previous week. The same time last week, the 15-year, fixed-rate mortgage was at 6.64%.

The APR on a 15-year fixed is 6.75%. It was 6.59% a week earlier.

A 15-year, fixed-rate mortgage with today’s interest rate of 6.71% will cost $883 per month in principal and interest on a $100,000 mortgage (not including taxes and insurance). In this scenario, borrowers would pay approximately $58,925 in total interest.

Jumbo Mortgage Rates

The current average interest rate on a 30-year fixed-rate jumbo mortgage is 7.46%. Last week, the average rate was 7.42%.

If you lock in today’s rate of 7.46% on a 30-year, fixed-rate jumbo mortgage, you will pay $697 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 $5,226, and you’d pay around $1.13 million in total interest over the life of the loan.

How Much House Can I Afford?

Everyone’s budget and financial goals vary. How much house you can afford comes down to a number of factors, including what you earn and what you owe. You’ll also want to consider how much you want to save for retirement, school and other expenses down the road.

Here are a few basic factors that go into what you can afford:

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

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

The annual percentage rate (APR) represents a loan’s interest rate and fees, expressed as an annual cost over the life of the loan. It’s essentially the all-in cost of the loan.

The APR is a helpful number because it shows you the total cost of a mortgage if you keep it the entire term.

How Are Mortgage Rates Determined?

Mortgage interest rates are determined by several factors, including some that borrowers can’t control:

  • Federal Reserve. The Fed rate hikes and decreases adjust the federal funds rate, which helps determine the benchmark interest rate that banks lend money at. As a result, mortgage rates tend to move in the same direction with the Fed’s rate decision.
  • Bond market. Mortgages are also loosely connected to long-term bond yields as investors look for income-producing assets—specifically, the 10-year U.S. Treasury Bond. Home loan rates tend to increase as bond prices decrease, and vice versa.
  • Economic health. Rates can increase during a strong economy when consumer demand is higher and unemployment levels are lower. Anticipate lower rates as the economy weakens and there is less demand for mortgages.
  • Inflation. Banks and lenders may increase rates during inflationary periods to slow the rate of inflation. Additionally, inflation makes goods and services more expensive, reducing the dollar’s purchasing power.

While the above factors set the base interest rate for new mortgages, there are several areas that borrowers can focus on to get a lower rate:

  • Credit score. Applicants with a credit score of 670 or above tend to have an easier time qualifying for a better interest rate. Typically, most lenders require a minimum score of 620 to qualify for a conventional mortgage.
  • Debt-to-income (DTI) ratio. Lenders may issue mortgages to borrowers with a DTI of 50% or less. However, applying with a DTI below 43% is recommended.
  • Loan-to-value (LTV) ratio. Conventional home loans charge private mortgage insurance when your LTV exceeds 80% of the appraisal value, meaning you need to put at least 20% down to avoid higher rates. Additionally, FHA mortgage insurance premiums expire after the first 11 years when you put at least 10% down.
  • Loan term. Longer-term loans such as a 30-year or 20-year mortgage tend to charge higher rates than a 15-year loan term. However, your monthly payment can be more affordable over a longer term.
  • Residence type. Interest rates for a primary residence can be lower than a second home or an investment property. This is because the lender of your primary mortgage receives compensation first in the event of foreclosure

What Is the Best Type of Mortgage Loan?

Many home buyers are eligible for several mortgage loan types. Each program can have its own advantages:

  • Conventional mortgage. A conventional home loan is ideal for borrowers with good or excellent credit to qualify for competitive rates. Additionally, making a minimum 20% down payment helps you waive private mortgage insurance premiums.
  • FHA loan. An FHA home loan is best when applying with imperfect credit or a low down payment. You can put as little as 3.5% down with a credit score above 580. A minimum 10% down payment is necessary for credit scores ranging from 500 to 579.
  • VA loan. Borrowers with a qualifying military background may prefer a VA loan for its flexibility. A down payment may not be required. While you pay a one-time funding fee, there are no ongoing mortgage insurance premiums or service fees.
  • USDA loan. Applicants in eligible rural areas can buy or build a home with no down payment, although an upfront and annual guarantee fee applies. Additionally, income requirements apply and this program requires a moderate income or lower.
  • Jumbo loan. Homebuyers in a high-cost-of-living area will need to apply for a jumbo loan when the loan amount exceeds the Federal Housing Finance Agency’s conforming loan limits. The limit in most municipalities is $726,200 in 2023.

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.