Compare Current Mortgage Rates in January 2025

To find the best rate for your situation, you’ll want to get personalized estimates from a few different lenders. 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. 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. After selecting your top options, connect with lenders online or on the phone.

year mortgage rates rise again, despite Fed cuts

Freddie Mac’s Jan. 2 report put the weekly 30-year fixed mortgage rate average at 6.91%, up six basis points from the previous week. But note that Freddie’s data are almost always out of date by the time it announces its weekly figures. 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.

APRs not included. For our most recent APR information, please visit our

This page provides general information regarding mortgage loans or home equity lines of credit. If you don’t lock in right away, a mortgage lender might give you a period of time—such as 30 days—to request a lock, or you might be able to wait until just before closing on the home. To get started, you can compare rates and different lender offerings online. Pay attention to the fine print on the websites to see how those rates are determined. For the most accurate quote, you’ll need to apply for a mortgage through various lenders or go through a mortgage broker. Though lenders decide your mortgage rate, there are some proactive steps you can take to ensure the best rate possible.

Why are mortgage rates so high?

The shorter repayment period and the higher monthly payments result in a savings of thousands of dollars in interest over the life of the loan. However, monthly payments are higher compared to longer-term mortgage loans. 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. 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.

What is the difference between interest rate and APR?

• Your rate and payment can rise or fall annually depending on how the broader interest rate trends.
• In some cases, the fees can be high enough to cancel out the savings of a low rate.
• Here’s what you need to know about qualifying for a pre-approval and the benefits of getting one.
• He has expertise in all mortgage products, including conventional, FHA, and VA loans.
• Macroeconomic factors kept the mortgage market relatively low for much of 2021.
• For example, average rates might be 7.12% on Tuesday and 7.06% on Wednesday.

Though today’s market data more so points to headwinds, likely putting upward pressure on mortgage rates in the short-term. Investopedia collects the best rates on actual closed mortgages 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. Factors that the borrower can control are their credit score and the home equity that will be created by the down payment amount.

Get your best mortgage rates by comparing offers from top lenders

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 loans offer the same fixed and variable rate terms as conventional mortgage loans, though their interest rates are typically lower. 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. Every Thursday, Freddie Mac, a government-sponsored buyer of mortgage loans, publishes a weekly average of 30-year mortgage rates. As recently as Sept. 26, the average sank to a two-year low of 6.08%.

What the Fed’s rate cuts mean for homebuyers and sellers

The Federal Reserve announced its most recent rate cut on December 18th of 2024, and indicated that we should expect fewer cuts in 2025 than we saw last year. Answer some questions about your homebuying or refinancing needs to help us find the right lenders for you. The MBA expects rates to hit 5.9% in 2025 and 5.5% in 2026, which home buyers and homeowners haven’t experienced since mid-2022. To cut costs, that could mean some buyers would need to move further away from higher-priced cities into more affordable metros.

Year Mortgage History

Adjustable-rate mortgages (ARMs) typically have lower initial interest rates compared to fixed loans. Once that initial period ends, the interest rate adjusts to the current market conditions. In this case, the initial period is five years and the adjustments are up to once every year. Homeowners with shorter term lending plans tend to see these as advantageous.

• Other factors, such as our own proprietary website rules and whether a product is offered in your area or at your self-selected credit score range, can also impact how and where products appear on this site.
• Rates began their descent in late summer in anticipation of the Federal Reserve finally cutting its key policy rate at its September meeting.
• The lender or loan program that’s right for one person might not be right for another.
• 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.
• If you plan to move in a few years, an ARM loan starts with lower mortgage interest rates for a period of time.
• Interest rates tend to change daily, and sometimes rates even change during the day.
• Our experts have been helping you master your money for over four decades.

Mortgage Rates Fall to Kick Off New Year Today, Jan. 2, 2025

Trying to decide whether to go with a fixed-rate or an adjustable-rate mortgage? With a fixed-rate mortgage, your interest rate is set in stone for the entire length of your loan. This means your monthly payments stay the same, making it super easy to budget and plan ahead without worrying about interest rates going up.

Current Mortgage Rates

Remember, if rates drop sharply, you are free to refinance and lock in a lower rate and payment later on. Adjustable-rate loans have a low interest rate that’s fixed for a set number of years (typically five or seven). After the initial fixed-rate period, the interest rate adjusts every year based on market conditions. In this case, a lender might raise its rates to deter new business and give loan officers time to process loans currently in the pipeline. Looking further ahead, Fannie Mae and the Mortgage Bankers Association (MBA) each has a team of economists dedicated to monitoring and forecasting what will happen to the economy, the housing sector and mortgage rates.

What is a 20-Year Mortgage?

Our daily mortgage rate averages are based on data from Zillow Group Marketplace. As this involves a different rate source and methodology, the averages will not directly align with those we published prior to May 1, 2024. All the historical data and analysis in this article and future articles is also based on this new data source.

• Rates for a home purchase and mortgage refinance are often similar.
• Jumbo loans offer the same fixed and variable rate terms as conventional mortgage loans, though their interest rates are typically lower.
• Variable rate products, such as ARMs, have interest rates that can change over the life of the loan.
• Curinos uses its own standardized parameters, such as a $350,000 conventional mortgage loan.
• In this case, a lender might raise its rates to deter new business and give loan officers time to process loans currently in the pipeline.
• For those who plan to stay in their home long-term, a fixed-rate mortgage is typically recommended.

• ARMs are ideal for borrowers who expect to move prior to their first rate adjustment (usually in 5 or 7 years).
• You need to apply for mortgage preapproval to find out how much you could qualify for.
• A mortgage rate is the amount of interest determined by a lender to be charged on a mortgage.
• This gives you time to sort out any errors and make sure your score is as high as possible.
• A good mortgage rate is one that aligns with current market trends and your financial situation.
• Most borrowers choose a 30-year mortgage because it has lower monthly loan balance payments compared to other terms, freeing up room for other financial goals.

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 from approximately 40 lenders, assuming a down payment of at least 20% and an applicant credit score in the 680–739 range. We believe this is more representative of what customers could expect to be quoted, depending on their qualifications. All monthly payment amounts above assume on time monthly payments each month for the full duration of the loan term (e.g. 360 monthly payments for a 30 year loan). Displayed monthly payment amounts do not include amounts for property taxes and hazard insurance. “Conforming thresholds” depend on the county where the property is located.

How to get the lowest mortgage or refinance rate

The best type of mortgage loan will depend on your financial goals — while some loan types consistently offer lower rates, they may do so at the expense of higher monthly payments or complicated repayment terms. Weigh the pros and cons of a 15- versus 30-year loan and take time to understand ARM rates and how they differ from traditional fixed mortgage rates before signing on the dotted line. Interest rates tend to change mortgage rates housing market daily, and sometimes rates even change during the day. You can compare current mortgage rates from our partner lenders here. You will get an idea of the interest rate, APR, closing costs, and monthly payment, but you should bear in mind that these numbers will change depending on your credit score and other financial details. A mortgage rate is the amount of interest determined by a lender to be charged on a mortgage.

• For advice about your specific circumstances, you should consult a mortgage professional and refer to the information and disclosures provided to you by the lender you choose regarding its products and services.
• The current average interest rate on a 15-year fixed-rate mortgage decreased NaN basis points from the prior week to %.
• The rates below are an average of quotes offered by many lenders and are adjusted to incorporate lender fees and points.
• Before joining Bankrate in 2020, I spent more than 20 years writing about real estate and the economy for the Palm Beach Post and the South Florida Business Journal.
• So once you check today’s rates, get a personalized quote just for you.
• Adjustable-rate loans have a fixed interest rate for the first few years.

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For example, advanced preparation and meeting with multiple lenders can go a long way. Even lowering your rate by a few basis points can save you money in the long run. Before joining Bankrate in 2020, I spent more than 20 years writing about real estate and the economy for the Palm Beach Post and the South Florida Business Journal. I’ve had a front-row seat for two housing booms and a housing bust. I’ve twice won gold awards from the National Association of Real Estate Editors, and since 2017 I’ve served on the nonprofit’s board of directors.

Jackie Studdert’s journey from Long Island to leadership in the mortgage industry. Learn about her role at Polly, her passion for data analytics, and her vision for innovation, mentorship, and improving customer experiences in the mortgage sector. To be eligible, you must be active-duty military, a veteran, a Reservist or National Guard service member, or an eligible spouse. For many people, it makes sense to make a smaller down payment in order to buy a house sooner and start building home equity.

Your rate and payment can rise or fall annually depending on how the broader interest rate trends. If you’re ready to apply now, it’s still worth checking so you have a good idea of what loan programs you might qualify for and how your score will affect your rate. Comparison shopping can potentially save thousands, even tens of thousands of dollars over the life of your loan.

Current mortgage & refinance interest rates

Other factors, such as our own proprietary website rules and whether a product is offered in your area or at your self-selected credit score range, can also impact how and where products appear on this site. While we strive to provide a wide range of offers, Bankrate does not include information about every financial or credit product or service. We receive current mortgage rates each day from a network of mortgage lenders that offer home purchase and refinance loans. Mortgage rates shown here are based on sample borrower profiles that vary by loan type. Those mortgage rates shown here are based on sample borrower profiles that vary by loan type.

When she’s not working on finance-related content, Caroline enjoys baseball, traveling and going to concerts. Finally, when you’re comparing rate quotes, be sure to look at the APR, not just the interest rate. The APR reflects the total cost of your loan on an annual basis and any discount points being charged. For example, you might be able to get an interest rate of 5.875% by paying 3.035 discount points, which would cost $10,623 on a $350,000 loan. On the same loan, your interest rate might be 6.375% if you paid 1.158 discount points, which would cost $4,053.