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Compare the Best Mortgage Rates Today (January 2024)

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As of Jan. 26, 2024, the average 30-year fixed mortgage rate is 7.10%, 20-year fixed mortgage rate is 6.95%, 15-year fixed mortgage rate is 6.45%, and 10-year fixed mortgage rate is 6.37%. Average rates for other loan types include 7.03% for an FHA 30-year fixed mortgage and 6.57% for a jumbo 30-year fixed mortgage.
These fixed-rate loan averages are not the teaser rates you may see advertised online. To find the average mortgage rates today, we use data that is calculated based on the lowest rate offered by more than 200 of the country's top lenders, assuming a loan-to-value ratio (LTV) of 80% and an applicant with a FICO credit score in the 700–760 range. We believe this is more representative of what customers could expect to be quoted, depending on their qualifications.

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Today's Mortgage Rates

Loan Type Purchase Refinance
30-Year Fixed 7.10% 7.61%
FHA 30-Year Fixed 7.03% 7.33%
VA 30-Year Fixed 6.81% 7.34%
Jumbo 30-Year Fixed 6.57% 6.58%
20-Year Fixed 6.95% 7.27%
15-Year Fixed 6.45% 6.66%
FHA 15-Year Fixed 6.83% 6.94%
Jumbo 15-Year Fixed 6.66% 6.66%
10-Year Fixed 6.37% 6.55%
10/6 ARM 7.50% 7.59%
7/6 ARM 7.52% 7.74%
Jumbo 7/6 ARM 6.33% 6.43%
5/6 ARM 7.55% 7.66%
Jumbo 5/6 ARM 6.30% 6.30%
National averages of the lowest rates offered by more than 200 of the country's top lenders, with a loan-to-value ratio (LTV) of 80%, an applicant with a FICO credit score of 700-760, and no mortgage points.

How to Use Our Mortgage Rate Table

Our mortgage rate table is designed to help you compare mortgage rates for the type of home loan you’re being offered by lenders to know if they are better or worse than the best rates available. These rates are benchmark rates for those with good credit, not the teaser rates that make everyone think they will get the lowest rate available. Of course, your personal credit profile will be a significant factor in what rate you get quoted, but you will be able to begin comparison shopping for either new purchase or refinance rates with confidence before you choose a mortgage lender.

30-Year Mortgage Rates

Loan Type Purchase Refinance
30-Year Fixed 7.10% 7.61%
FHA 30-Year Fixed 7.03% 7.33%
VA 30-Year Fixed 6.81% 7.34%
Jumbo 30-Year Fixed 6.57% 6.58%

What Is a 30-Year Mortgage?

A 30-year mortgage is a conventional home loan that offers a fixed rate for a 30-year term. This means that your monthly payments, consisting of the principal and interest, remain the same throughout the lifetime of the loan. Some 30-year mortgages are government-backed loans, such as the ones from the Department of Veterans Affairs (VA), the United States Department of Agriculture (USDA), and Federal Housing Authority (FHA).

Most borrowers choose a 30-year mortgage because it has lower monthly payments compared to other terms, freeing up room for other financial goals. According to Freddie Mac, this is the most popular type of mortgage, with almost 90% of homeowners opting for a 30-year term.

In the News

Freddie Mac's Oct. 26 release of weekly mortgage data was historic, indicating that 30-year mortgage rates had climbed to a 7.79% average—the highest level in 23 years. But in the eight weeks since, the Freddie Mac 30-year average has steadily fallen. Today's newly published average plunged 28 basis points, lowering the average to 6.67%, the lowest mark since June.

Freddie Mac’s averages differ from those we publish here due to Freddie Mac calculating a weekly average that blends five previous days of rates, which may include loans priced with discount points. In contrast, Investopedia’s averages indicate daily rate movement and only include zero-point loans.

Who Should Consider a 30-Year Mortgage?

People looking to buy a home who want the lowest possible mortgage payments should consider a 30-year mortgage. Although it may come with a higher interest rate compared to other home loan terms, monthly mortgage payments are lower because they are extended over a long term.

In other words, homeowners can take advantage of better cash flow to pursue other financial goals like saving for retirement or stashing away an emergency fund. Depending on the lender, those who want to make higher monthly payments can do so to pay off the mortgage faster while still allowing the option not to.

20-Year Mortgage Rates

Loan Type Purchase Refinance
20-Year Fixed 6.95% 7.27%

Who Should Consider a 20-Year Mortgage?

Any homeowner who borrows money to benefit from lower interest rates and pay off their mortgage sooner-than-later should consider a 20-year mortgage. In general, 20-year mortgage rates are lower than 30-year ones, helping to reduce the payments of interest over the course of the loan.
However, a 20-year mortgage pays the loan off faster and thus has a higher monthly obligation. Homeowners should factor in higher costs to their monthly budget when it comes to choosing a 20-year mortgage, although it is still less than what a 15-year mortgage would require.

What Are the Benefits of a 20-Year Mortgage?

The main benefit of a 20-year mortgage is the savings homeowners receive from lower interest rates and paying it off sooner than 30 years. For instance, if you purchase a home for $300,000 and put 20% down. Instead of a 30-year mortgage at 3.25%, you opt for the 20-year term at 3%, you can save around $49,313.50 in interest throughout the lifetime of the loan. 

A 20-year mortgage has more affordable monthly payments than a 15-year mortgage. Although you’ll most likely save even more in interest with the 15-year mortgage, the monthly payment will be higher, which can be burdensome for some borrowers.

15-Year Mortgage Rates

Loan Type Purchase Refinance
15-Year Fixed 6.45% 6.66%
Jumbo 15-Year Fixed 6.66% 6.66%

What Is a 15-Year Mortgage?

A 15-year mortgage is a fixed-rate loan to pay for a home purchase. The monthly payment, which includes principal and interest, remains the same throughout the lifetime of the mortgage.

It is paid off in half the time of a traditional 30-year mortgage. The abbreviated time span and the higher monthly payments result in a savings of thousands of dollars in interest over the life of the loan.

When Is a 15-Year Mortgage a Smart Option?

A 15-year mortgage is a smart option for borrowers who want to save money on interest and can afford larger monthly payments without compromising their other financial goals and responsibilities.
For instance, a borrower who can't take out a 15-year mortgage without sacrificing regular contributions to a savings account and a retirement fund should probably stick to a longer-term mortgage. A 20-year term is a happy medium.
For borrowers who have variable or sporadic incomes, a 15-year mortgage makes sense only if there is a realistic plan to make the mortgage payment through the lean periods.
If you have a plan, the savings are worth it. Let’s say you have a $300,000 mortgage, and the rate is 4.25% for a 30-year term, compared to 4.00% for a 15-year term. By the end of the 30-year term, you’ll have paid $231,295.08 in interest compared to $99,431.48, a savings difference of $131,863.60. That’s pretty significant.

However, the price savings equates to a much higher monthly payment. The payment for the 30-year mortgage will be $1,475.82, compared to the 15-year loan, which is $2,219.06. That’s why it’s a smart idea to shop around for the lowest rates and compare terms to make sure you can comfortably afford the mortgage.

10-Year Mortgage Rates

Loan Type Purchase Refinance
10-Year Fixed 6.37% 6.55%
10/6 ARM 7.50% 7.59%

Who Should Consider a 10-Year Mortgage?

Homeowners who want to be able to pay off their mortgage quickly and have the means to pay the large monthly payment should consider a 10-year mortgage. Also, since lenders may view these types of borrowers as more high-risk (since you’ll need to pay more each month), you’ll most likely need to have an excellent credit profile in order to qualify.

A 10-year home loan is also best for those who want to refinance their mortgage and have been paying down their existing loan for a while. For instance, those who have close to 10 years until they’re mortgage-free may not want to refinance to a loan with a longer term. That is, unless you’re looking to refinance to a longer term to lower payments—keep in mind you’ll end up paying more in interest in the long run if you go with the longer loan term. 

First-time home buyers who are younger should carefully consider whether a 10-year mortgage is the best choice. Look at your current income and whether it can sustain a larger monthly mortgage payment besides other financial obligations and savings goals. A longer term may be more beneficial so that you can leave room in your budget for expenses such as student loans, creating an emergency fund, or other costs associated with homeownership like repairs.

What Are the Benefits of a 10-Year Mortgage?

The major benefit of taking out a 10-year fixed-rate mortgage is that homeowners can pay off their loan much faster than other loan terms. Since rates may be lower than a 20- or 30-year term and because homeowners are making fewer payments, borrowers will save the most money on interest with a 10-year term. Plus, homeowners will be able to build equity much faster. 
For instance, a $300,000 30-year mortgage with a 20% down payment and an interest rate of 3.5% will end up paying $147,974.61 in interest. If you take out a 10-year loan with the same interest rate and the same loan amount, you’ll end up paying $44,791.30 in interest, a $103,183.31 difference. However, the monthly payment for the 30-year term is $1,077.71, compared to $2,373.26 for the 10-year loan. These financial considerations need to be carefully thought out before making such a major decision.

What Is a Mortgage and How Does It Work?

A mortgage is a type of loan used to purchase or maintain a home, land, or other types of real estate. The borrower agrees to pay the lender over time, typically in a series of regular payments divided into principal and interest. The property then serves as collateral to secure the loan.

Individuals and businesses use mortgages to buy real estate without paying the entire purchase price upfront. The borrower repays the loan plus interest over a specified number of years until they own the property free and clear. Most traditional mortgages are fully-amortizing. This means that the regular payment required will stay the same, but different proportions of principal vs. interest will be paid over the life of the loan with each payment. Typical mortgage terms are for 30 or 15 years.

Types of Mortgages

There are numerous types of mortgages in the mortgage market, including those from private mortgage lenders as well as government-backed loan programs that purchase, guarantee, and securitize mortgages in the secondary mortgage market like those by the Federal Housing Administration (FHA), known as FHA loans, or the Federal National Mortgage Association (Fannie Mae).

A conventional mortgage can be fixed-rate with terms varying from 10 to 30 years or an adjustable-rate mortgage (ARM) with terms up to 10 years. Jumbo mortgage loans that exceed the Federal Housing Finance Agency's conforming loan limit of $766,550 for 2024 cannot be purchased, guaranteed, or securitized by Fannie Mae or the Federal Home Loan Mortgage Corporation (Freddie Mac). Jumbo loans offer the same fixed and variable rate terms as conventional mortgage loans, though their interest rates are typically lower.

What Is a Good Mortgage Rate?

A good mortgage rate, which is usually represented as the lowest available rate for a 30-year fixed mortgage, will depend on the borrower. Lenders will advertise the lowest rate offered but yours will depend on factors like your credit history, income, other debts, and your down payment. For instance, a good mortgage rate for someone who has a low credit score tends to be higher than for someone who has a higher credit score.
It’s important to understand what will affect your individual rate and work towards optimizing your finances so you can receive the most competitive rate based on your financial situation

The Difference Between Interest Rate and APR

The advertised rate or nominal interest rate for a loan, whether for a mortgage, personal loan, or credit card, is the basic cost of borrowing the principal stated as a percentage. The annual percentage rate (APR), reflected as a percentage, is the total cost of the loan, including the fees and all other costs associated with the loan, in this case, a mortgage loan, such as the origination fee and discount points.

The APR, therefore, almost always calculates to a higher interest rate than the nominal interest rate since fees and other costs are factored into the rate, including the interest rate.

How Are Mortgage Rates Set?

Mortgage rates are set based on a few factors, economic forces being one of them. For instance, lenders look at the prime rate—the lowest rate banks offer for loans—which typically follows trends set by the Federal Reserve’s federal funds rate, currently set at a range of 5.25% - 5.50%. Fed Funds rates are typically stated in this type of range, which varies that rate by 0.25 percent.

The 10-year Treasury bond yield can also reveal market trends. If the bond yield increases, mortgage rates tend to go up, and vice versa. The 10-year Treasury yield is usually the best standard to judge mortgage rates. That’s because many mortgages are refinanced or paid off after 10 years, even if the norm is a 30-year fixed-rate mortgage loan. 

Factors that the borrower can control are their credit score and the home equity that will be created by the down payment amount. Since a lender sets rates based on the risk they may take, borrowers who are less creditworthy or have a lower down payment amount may be quoted higher rates. In other words, the lower the risk, the lower the rate for the borrower.

How to Get the Best Mortgage Rates

There are several things to keep in mind when shopping for mortgage rates to ensure you get the best deal:

  1. Know your credit score.
  2. Estimate how much down payment you can make using our mortgage calculator.
  3. Estimate how long you plan to stay in your home.
  4. Determine the best type and term of mortgage, whether fixed-rate or variable-rate, that is most affordable based on the factors above.
  5. Use our rate table to help you identify whether lenders are offering you a competitive rate based on your credit profile.
  6. Avoid opening new types of credit accounts like credit cards or personal loans before applying for a mortgage, as these can temporarily lower your credit score.

How Do I Qualify for Better Mortgage Rates?

Qualifying for better mortgage rates can help you save money, potentially tens of thousands of dollars over the life of the loan. Here are a few ways you can ensure you find the most competitive rate possible:
  • Raise your credit score: A borrower's credit score is a major factor in determining mortgage rates. The higher the credit score, the more likely a borrower can get a lower rate. It's a good idea to check your credit score to see how you can improve it, whether that's by making on-time payments or disputing errors on your credit report. 
  • Increase your down payment: Most lenders offer lower mortgage rates for those who make a larger down payment. This will depend on the type of mortgage you apply for, but sometimes, putting down at least 20% could get you more attractive rates. 
  • Lower your debt-to-income ratio: Also called DTI, your debt-to-income ratio looks at the total of your monthly debt obligations and divides it by your gross income. Usually, lenders don't want a DTI of 43% or higher, as that may indicate that you may have challenges meeting your monthly obligations as a borrower, as adding a mortgage payment could potentially put you underwater. The lower your DTI, the less risky you will appear to the lender, which will be reflected in a lower interest rate. 

How to Refinance Your Mortgage

The refinance market has been very quiet in the past year because mortgage rates have been steadily rising, reaching a record 23-year high in October of over 8%. However, rates could potentially begin to decrease in 2024 as most Federal Open Market (FOMC) members expect between 2 and 4 rate reductions next year. Refinancing your mortgage could save you money if rates drop below the rate you are currently paying.

The process for refinancing a mortgage is similar to getting a purchase mortgage in that it entails shopping for rates and loan terms based on your credit score and completing an application. Instead of obtaining an appraisal on the property being initially purchased a new appraisal is required on the home you are refinancing. Also, unlike a new purchase mortgage refinancing a mortgage does not require a down payment. Mortgage refinancing does involve closing costs, however, so it's important to project a breakeven point with these costs measured against your potential savings when rates drop enough to consider refinancing your mortgage to determine if it makes financial sense.
Below are the steps involved in refinancing a mortgage:
  • Check your credit
  • Decide the type of loan you want
  • Compare lender's rates and terms
  • Apply for the loan
  • Finalize terms and lock in the rate
  • Pay off your old mortgage with your new loan

Trends in Mortgage Rates: Are They Rising or Falling?

Trends in mortgage rates are influenced by complex factors, such as the Federal Reserve’s interest rate policy, employment rate, the Consumer Price Index, and the yields of 10-year treasury bonds. Mortgage rates are not directly tied to any of these factors but are indirectly influenced by their current levels and consensus predictions on how they will trend in the near future.

Mortgage rates have risen significantly since the Federal Reserve began raising the federal funds rate in March of 2022. Since then, the Fed funds rate has risen by 525 basis points but has remained steady over the Fed's last three rate-setting meetings. Mortgage rates are not directly tied to the movement of the Fed funds rate, however, and are determined by complex factors like interactions in the government bond market, specifically involving the yield on 10-year treasury bonds, Fed monetary policy in funding government-backed mortgages, and competitive factors among mortgage lenders.

So, it is impossible to say if mortgage rates will continue to rise or if they will remain steady or even begin to fall at any given point. Mortgage rates reached highs in October 2023, though, and the Fed's monetary policy to address stubborn but moderating inflation into 2024 will likely have an influence on rates, if only indirectly.

The Fed has opted to hold rates steady at its last three meetings, which concluded Sept. 20, Nov. 1., and Dec. 13. But Fed Chair Jerome Powell has made it clear that another rate increase is still possible at a future meeting. The Fed’s next rate announcement will be made on Jan. 31, 2024.

Tip

If you're ready to pursue a mortgage, you can use our ranking of the best mortgage lenders to assess your options.

Mortgage Options for First Time Homebuyers

While most mortgage originations occur in the private market, government-backed mortgages occupy an important niche and provide access to first-time homebuyers and borrowers who could not otherwise qualify or afford the terms of traditional mortgages.

Government-backed loans like FHA loans, state FHA loans, USDA loans (USDA guaranteed loans), and VA loans (backed by the Department of Veteran Affairs) can offer significant advantages to qualifying borrowers, including lower interest, longer terms, and a lower percentage of down payment (or no down payment) compared to conventional loans. For these types of loans with lower down payment options, the borrower can be required to acquire private mortgage insurance.

"Our last mortgage was during a previous high-rate environment, in the midst of the financial crisis of 2008 when rates were in the mid-6% range. Luckily, there were numerous opportunities to refinance at lower rates in the subsequent years." -Ben Woolsey, Investopedia Associate Editorial Director

Frequently Asked Questions (FAQs)

What Is a Mortgage Rate?

A mortgage rate is the amount of interest determined by a lender to be charged on a mortgage. These rates can be fixed—meaning the rate is set based on a benchmark rate—for the duration of the borrower’s mortgage term, as in the case of a 15-year fixed rate mortgage, or variable based on the mortgage terms and current rates. The rate is one of the key factors for borrowers when seeking home financing options since it’ll affect their monthly payments and how much they’ll pay throughout the lifetime of the loan. 

How Big of a Mortgage Can I Afford?

In general, homeowners can afford a mortgage that’s two to two-and-a-half times their annual gross income. For instance, if you earn $80,000 a year, you can afford a mortgage from $160,000 to $200,000. Keep in mind that this is a general guideline, and you need to look at additional factors when determining how much you can afford, such as your lifestyle and your attitudes and habits around personal finance.

First, your lender will determine what it thinks you can afford based on your income, debts, assets, and liabilities. However, you need to determine how much you’re willing to spend and your current expenses. Most experts recommend not spending more than 28% of your gross income on housing costs. Lenders will also look at your DTI, meaning that the higher your DTI, the less likely you’ll be able to afford a bigger mortgage. 

Don’t forget to include other costs besides your mortgage, including any applicable HOA fees, homeowners’ insurance, property taxes, and home maintenance costs. Using a mortgage calculator can be helpful in this situation to help you figure out how you can comfortably afford a mortgage payment.

What Are Mortgage Points?

Also known as discount points, this is a one-time fee, or prepaid interest borrowers purchase to lower the interest rate for their mortgage. Discount points equate to percentage points - so, one discount point costs 1% of your mortgage amount, or $1,000 for every $100,000, and will lower the rate by a quarter of a percent, or 0.25.

For example, if the interest rate is 7%, purchasing one mortgage point will reduce the rate to 6.75%, which can save a significant amount of interest expense in your monthly mortgage payments, and the savings over the life of the loan can be significant.

Another option for a reduced-rate mortgage is through a 2-1 buydown mortgage, which entails a low rate in the first year, a somewhat higher rate in the second year, and then the regular mortgage rate for the remaining term of the mortgage.

What Are the Best Mortgage Rates Right Now?

The best mortgage rates right now will depend on a variety of factors, like if your credit score, location, and type of mortgage. Depending on where you live in the country you may be able to get a lower rate if you have excellent credit. Rates are also lower on different types of mortgages such as those with larger loan amounts, shorter terms, or adjustable rates.

Will Mortgage Rates Fall Below 6% in 2024?

Mortgage rates could potentially dip below 6% in 2024 if the Federal Reserve lowers the Fed funds rate by a total of 75 basis points this year, as it signaled at its last meeting in December 2023. Mortgage rates tracked by Investopedia briefly went below 7%, down to 6.91%, as recently as December 27, 2023. Since other factors influence mortgage rates beyond the Fed funds rate, it is conceivable that lenders could offer rates below 6% in 2024.

How Much Will I Need for a Down Payment?

The minimum you’ll need to put down will depend on the type of mortgage. Many lenders require a minimum of 5% to 20%, whereas others like government-backed ones require at least 3.5%. The VA loan is the exception with no down payment requirements. 

Generally, the higher your down payment, the lower your rate may be. Homeowners who put down at least 20% will be able to save the most. 

What Is the Best Way to Get the Lowest Mortgage Rate?

The best way to ensure you qualify for the lowest mortgage rate is to know and optimize your credit score by keeping your debt to income level as low as possible, preferably below 28%, and not applying for any other types of loans in the six months preceding any mortgage applications, paying all your bills on time and making sure there are no mistakes on your credit report. Making a down payment of at least 20% on conventional loans (keeping your loan-to-value at least 80%) is also an important factor in qualifying for good mortgage interest rates. Then, shopping around with different types of lenders, both online and with brick-and-mortar financial institutions in your area, will also help to secure the lowest possible rate.

Is 7% a Bad Mortgage Rate?

A 7% mortgage rate would not be considered an unfavorable rate in today's rate environment. Investopedia's national average for mortgage rates ha recently been hovering slightly above and below the 7% mark, but that rate does not include any discount points.

What Banks Have the Best Mortgage Rates Right Now?

Bank of America has some of the lowest mortgage rates among big banks right now but many banks and credit unions have competitive rates in local markets around the country so borrowers should do their homework before committing to a mortgage. We rank Bank of America as the best big bank mortgage lender because they offer multiple loan options for low- and middle-income borrowers, have a massive branch network across all 50 states, and offer loans with down payments as low as 0% - 3%. When comparing rates on bank and mortgage lender websites it's important to note that many quote rates that involve the purchase of discount points. The rates that Investopedia tracks do not involve discount points.

Why You Should Trust Us

Investopedia collects the best rates on actual closed mortgages through a third-party data provider from more than 200 companies every business day to identify the most competitive rates and terms in the nation as well as in the states in which our readers reside. Investopedia launched in 1999, and has been helping readers find the best mortgage rates since 2021.

How We Track the Best Mortgage Rates

To assess mortgage rates, we first needed to create a credit profile. This profile included a credit score ranging from 700 to 760 with a property loan-to-value ratio (LTV) of 80%. With this profile, we averaged the lowest rates offered by more than 200 of the nation’s top lenders. These rates represent what real consumers will see when shopping for a mortgage. 
The same credit profile was used for the best state rates map. We then found the lowest rate currently offered by a surveyed lender in that state. 
Remember that mortgage rates may change daily, and this average rate data is intended for informational purposes only. A person’s personal credit and income profile will be the deciding factors in what loan rates and terms they can get. Loan rates do not include amounts for taxes or insurance premiums, and individual lender terms will apply. 

Your Guide to Mortgage Rates

Investopedia / Arif Qazi
Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
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  9. U.S. Department of Veterans Affairs. "."
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