Compare current mortgage rates for February 2024


In early February, average mortgage rates exceeded 7% for the first time since early December.

The rally was fueled by strong labor data and indications from the Federal Reserve that interest rate cuts may come later than most expected. However, interest rates have continued to decline significantly since their peak of 8.01% in October last year.

If you're planning to buy a home, compare loan offers from multiple lenders to find the best interest rate for you.

read more: Mortgage rate prediction: Experts say interest rates could fall below 6% this year

Most mortgage forecasters predict that interest rates will fall by nearly 6% through 2024. But developments in mortgages will depend on economic indicators, particularly how much inflation slows and when the Fed decides to start cutting interest rates.

The Fed chose to keep interest rates unchanged for the fourth consecutive time at its Jan. 30-31 meeting. Although the Fed does not directly set mortgage rates, adjustments to the federal funds rate affect interest rates on consumer borrowings, including mortgages.

The Fed could cut rates at its next meeting in March, but many experts expect a more cautious approach, especially after recent stronger-than-expected jobs data. The central bank may not start cutting rates until early summer.

“If all goes well, mortgage rates could be closer to 6% or even lower by the time 2025 rolls around,” said Jacob Channell, senior economist at online lending marketplace LendingTree.

Current mortgage interest rates and refinance rates

What are the mortgage interest rates today?

As of February 8, the average interest rate for a 30-year fixed mortgage was 7.10%, with an annual percentage rate of 7.11%. The average 15-year fixed mortgage rate is 6.52%, or 6.55% APR. Also, according to the latest survey conducted by Bankrate of Japan's largest mortgage lenders, the average interest rate for a 5/1 variable rate mortgage is 6.11%, and the annual interest rate is 7.27%.

current mortgage interest rate


product interest rate April
30 year fixed interest rate 7.16% 7.18%
30 Year Fixed Rate FHA 6.40% 7.09%
30 year fixed rate VA 6.65% 6.77%
30 year fixed rate jumbo 7.22% 7.24%
20 year fixed rate 7.00% 7.02%
15 year fixed interest rate 6.56% 6.59%
15 year fixed rate jumbo 6.64% 6.65%
5/1 arm 6.13% 7.27%
5/1 ARM Jumbo 5.95% 7.01%
7/1 arm 6.36% 7.24%
7/1 ARM Jumbo 6.10% 6.92%
10/1 arm 7.18% 7.73%
30 year fixed rate refinance 7.19% 7.21%
30 Year Fixed Rate FHA Refinance 6.43% 7.14%
30 Year Fixed Rate VA Refinance 6.57% 6.77%
30 year fixed rate jambo refinance 7.24% 7.26%
20 year fixed rate refinance 7.05% 7.07%
15 year fixed rate refinance 6.57% 6.60%
15 year fixed rate jumbo refinance 6.63% 6.65%
5/1 ARM refinance 6.06% 7.15%
5/1 ARM Jamboree Finance 5.98% 6.97%
7/1 ARM refinance 6.29% 7.14%
7/1 ARM Jamboree Finance 6.08% 6.90%
10/1 ARM refinance 7.21% 7.73%

Last updated on February 12, 2024.

We track daily mortgage rate trends using information collected by Bankrate, which is owned by the same parent company as CNET. The table above summarizes the average interest rates offered by lenders nationwide.

What is a mortgage interest rate?

Mortgage interest rate is the percentage of interest charged by a lender to provide the loan needed to purchase a home. The price offered is determined by multiple factors. Some are specific to you and your financial situation, while others are influenced by macro market conditions such as inflation, Federal Reserve monetary policy, and overall loan demand.

What factors determine home loan interest rates?

While the overall economy plays an important role in mortgage rates, there are several important factors that you can control that affect interest rates.

  • Your credit score: The lender offers the lowest interest rates available to borrowers with excellent credit scores of 740 or higher. A lower credit score is considered a higher risk, so lenders will charge higher interest rates to compensate.
  • Loan size: The size of your loan can affect the interest rate you qualify for.
  • Loan period: The most common mortgage is a 30-year fixed rate loan, with payments spread over 30 years. Shorter loans, such as a 15-year mortgage, typically have lower interest rates but higher monthly payments.
  • Loan type: The type of mortgage you choose will affect your interest rate. Some loans have fixed interest rates for the entire term of the loan. Some loans have adjustable interest rates, which may have a low interest rate at the beginning of the loan, but may result in higher payments in the future.

What is the annual interest rate on a home loan?

The annual percentage rate (APR) is usually higher than the interest rate on your loan and represents the actual cost of your loan. This includes interest and other costs such as loan fees and prepaid points. So while you might be tempted by the offer of 'as low as 6.5%', to see what you're actually paying, look at the APR instead.

Advantages and disadvantages of taking out a home loan

Strong Points

  • Instead of paying rent without ownership, you can build equity in real estate.

  • Build credit by paying on time.

  • You can deduct mortgage interest from your annual taxes.

Cons

  • You will end up incurring a large amount of debt.

  • You'll end up paying more than the list price because of interest fees (which can be even more on a 30-year loan).

  • To close a mortgage, you need to budget for closing costs, which can run into the tens of thousands of dollars in some states.

How does APR affect principal and interest?

Most mortgages are based on an amortization schedule. You pay the same amount each month over the life of your loan, but the interest you accrue is highest at the beginning and gradually decreases as your principal (the amount you borrow) decreases. An amortization schedule shows how much of your monthly payments go toward interest and how much you repay the principal. Most borrowers find fixed, predictable monthly payments more convenient.

Mortgage lenders often publish interest rates for different types of mortgages, which can help you research and narrow down where to apply for pre-approval. However, the advertised rate is not necessarily the rate you will actually get. When shopping for a new mortgage, it's important to compare not only mortgage rates, but also closing costs and other fees associated with the loan. Experts recommend researching multiple lenders to get quotes and not rushing the process.

FAQ

Most conventional loans require a credit score of 620 or higher, but Federal Housing Administration and other types of loans may accommodate borrowers with scores as low as 500, depending on the lender.

Your credit score isn't the only thing that affects your mortgage interest rate. Lenders will also look at your debt-to-income ratio to assess your level of risk based on other debts you're paying off, such as student loans, car payments, and credit cards. Additionally, the loan-to-value ratio plays an important role in mortgage interest rates.

A rate lock means your interest rate will remain the same from the time you make the offer until the deal closes. For example, if you lock in today's interest rate at his 6.5%, and in the next 30 days the lender's interest rate increases to his 7.25%, you will receive the lower interest rate. The typical rate lock period is 45 days, so you're still on a tight schedule. Be sure to ask your lender about the rate lock window and the costs of securing a rate.

Mortgage rates are constantly changing and it is impossible to predict the market. However, most experts believe that mortgage rates will gradually decline during 2024. Fannie Mae expects the average interest rate on 30-year fixed mortgages to end the year at 5.8%.

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