Your mortgage rate decides how much you'll pay over the life of your loan, so it's worth a few minutes to understand what's driving it. Here's the short, jargon-free version.
What is a mortgage rate?
It's the interest percentage your lender charges on your home loan. On a 30-year fixed mortgage, that rate stays the same for the entire loan term. As a quick example, a $400,000 loan at 7% comes out to roughly $2,661/month in principal and interest.
What actually moves the rate?
1. The Federal Reserve
The Fed sets short-term interest rates. It doesn't set mortgage rates directly, but when the Fed hikes to fight inflation, mortgage rates usually drift up alongside.
2. The bond market
Mortgage rates track the 10-year Treasury yield closely. When bond investors demand higher yields, mortgage rates climb — which is why the number you're quoted can shift day to day based on economic news.
3. You
Lenders price your loan based on your personal risk profile:
- Credit score: 740+ generally unlocks the best rates.
- Down payment: 20% or more often means a lower rate (and no PMI).
- Debt-to-income ratio: lower is better.
- Loan type: Conventional, FHA, VA and jumbo loans all price differently.
Fixed vs. adjustable
A fixed-rate mortgage locks your rate for the full term (15, 20, or 30 years). An adjustable-rate mortgage (ARM) starts lower and resets periodically based on market conditions. Fixed = predictable. ARM = cheaper up front, riskier later.
How to get a better rate
- Bump your credit score before you apply.
- Save for a bigger down payment — 20% is the sweet spot.
- Get quotes from at least 3–5 lenders. Don't shop one and call it a day.
- Consider buying points to lower your rate if you'll stay in the home a while.
- Time your application for a week when rates dip (which is, of course, why this site exists).
Check today's rate
The current 30-year fixed average is on the homepage, and the monthly payment calculator on the same page will plug today's rate in for you.
Disclaimer: rates shown are national averages. Your actual rate depends on your credit profile and the lender you choose. This is not financial advice.