October 9, 2024—Rates Move Up – Forbes Advisor – Technologist

The current average mortgage rate on a 30-year fixed mortgage is 6.96%, compared to 6.70% a week earlier, according to Curinos.

For borrowers who want a shorter mortgage, the average rate on a 15-year fixed mortgage is 6.13%, up 0.39 percentage point from the previous week.

If you want to lock in a lower rate by refinancing, compare your existing mortgage rate to today’s refinance rates.

Current Mortgage Rates for October 9, 2024

30-Year Mortgage Rates

Borrowers will pay more in interest this week as the average rate on a 30-year mortgage is 6.96% compared to a rate of 6.70% 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 6.98%. The APR was 6.71% last week.

If your mortgage is $100,000 and you have a 30-year, fixed-rate mortgage with the current rate of 6.96%, you will pay about $663 per month in principal and interest (taxes and fees not included), the Forbes Advisor mortgage calculator shows. That’s around $138,615 in total interest over the life of the loan.

15-Year Mortgage Rates

Today’s 15-year mortgage (fixed-rate) is 6.13%, up 0.39 percentage point from the previous week. The same time last week, the 15-year, fixed-rate mortgage was at 5.74%.

The APR on a 15-year fixed is 6.16%. It was 5.77% a week earlier.

A 15-year, fixed-rate mortgage with today’s interest rate of 6.13% will cost $851 per month in principal and interest on a $100,000 mortgage (not including taxes and insurance). In this scenario, borrowers would pay approximately $53,161 in total interest.

Jumbo Mortgage Rates

The current average interest rate on a 30-year, fixed-rate jumbo mortgage is 6.99%— 0.26 percentage point up from last week. The 30-year jumbo mortgage rate had a 52-week APR low of 5.50% and a 52-week high of 10.50%.

A 30-year jumbo mortgage at today’s fixed interest rate of 6.99% will cost you $665 per month in principal and interest per $100,000. On a $750,000 jumbo mortgage, the monthly principal and interest payment would be approximately $4,986.

How To Calculate Mortgage Payments

Before you look for a house, you should get to know your budget. This will give you an idea of the type of house you can afford. A good place to start is by using a mortgage calculator to get a rough estimate.

Simply input the following information:

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

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?

Multiple factors affect the interest rate for a mortgage, including the economy’s overall health, benchmark interest rates and borrower-specific factors.

The Federal Reserve’s rate decisions and inflation can influence rates to move higher or lower. Although the Fed raising rates doesn’t directly cause mortgage rates to rise, an increase to its benchmark interest rate makes it more expensive for banks to lend money to consumers. Conversely, rates tend to decrease during periods of rate cuts and cooling inflation.

Home buyers can make several moves to improve their finances and qualify for competitive rates. One is having a good or excellent credit score, which ranges from 670 to 850. Another is maintaining a debt-to-income (DTI) ratio below 43%, which implies less risk of being unable to afford the monthly mortgage payment.

Further, making a minimum 20% down payment can help you avoid private mortgage insurance (PMI) on conventional home loans. If you can afford the larger monthly payment, 15-year home loans have lower rates than a 30-year term.

What Is the Best Type of Mortgage Loan?

Conventional home loans are issued by private lenders and typically require good or excellent credit and a minimum 20% down payment to get the best rates. Some lenders offer first-time home buyer loans and grants with relaxed down payment requirements as low as 3%.

For buyers with limited credit or finances, a government-backed loan is usually the better option as the minimum loan requirements are easier to satisfy.

For example, FHA loans can require 3.5% down with a minimum credit score of 580 or at least 10% down with a credit score between 500 and 579. However, upfront and annual mortgage insurance premiums can apply for the life of the loan.

Buyers in eligible rural areas with a moderate income or lower may also consider USDA loans. This program doesn’t require a down payment, but you pay an upfront and annual guarantee fee for the life of the loan.

If you come from a qualifying military background, VA loans can be your best option. First, you don’t need to make a down payment in most situations. Second, borrowers pay a one-time funding fee but don’t pay an annual fee as the FHA and USDA loan programs require.

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