The average mortgage interest rate by state, credit score, year, and loan type (2024)

FAQs

What are mortgage rates in the states? ›

Mortgage rates vary by state because they depend on the local economy. Your state's economic health will affect its foreclosure rate, and foreclosures cause mortgage lenders to raise their mortgage rates. If your state has a high unemployment rate, home prices will likely fall and mortgage rates may be elevated.

Today's national 30-year mortgage interest rate trends

If you're in the market for a mortgage refinance, the average 30-year fixed refinance interest rate is 7.16%, up 4 basis points since the same time last week.

The average APR offered across the U.S. is 4.95%. California is the state with the lowest average APR of 4.83% while New York is the highest with 5.07%.

The study revealed that the average interest rate across all 50 states was 4.84%, with the lowest being 4.74% and the highest 4.96%. California, New Jersey, Washington and Massachusetts had the lowest average interest rates, while New York, Iowa and Arkansas had the highest.

2. Home location. Many lenders offer slightly different interest rates depending on what state you live in. To get the most accurate rates using our Explore Interest Rates tool, you'll need to put in your state, and depending on your loan amount and loan type, your county as well.

Closing costs typically range from 3% to 6% of the loan amount. 1 Thus, if you buy a $200,000 house, your closing costs could range from $6,000 to $12,000. Closing fees vary depending on your state, loan type, and mortgage lender.

“[W]ith the rate of inflation decelerating rates should gently decline over the course of 2023.” Fannie Mae. 30-year fixed rate mortgage will average 6.4% for Q2 2023, according to the May Housing Forecast. National Association of Realtors (NAR).

How high will interest rates go in 2023? ›

So far in 2023, the Fed raised rates 0.25 percentage points twice. If they hike rates at the May meeting, it is likely to be another 0.25% jump, meaning interest rates will have increased by 0.75% in 2023, up to 5.25%.

Along those lines, organizations like Fannie Mae and the Mortgage Bankers Association forecast that the average rate on 30-year fixed-rate mortgages will decline throughout 2023, continuing into the first quarter of 2024.

Generally speaking, borrowers with credit scores of 760 or higher get charged the lowest interest rates. On conventional conforming loans, which must adhere to Fannie Mae and Freddie Mac guidelines, a 780 may qualify you for a slightly lower rate—though it depends on your down payment amount.

Lowest annual mortgage rate: 2016

While the lowest interest rate for a mortgage in history came in 2020-2021, the lowest annual mortgage rate on record was in 2016, when the typical mortgage was priced at 3.65%.

The highest mortgage rates in history were in the 1980s. Thirty-year fixed mortgage rates hit their peak at 18.63% in October 1981. This was likely due to high inflation following the OPEC embargo.

Current rates are more than double their all-time low of 2.65% (reached in January 2021). But if we take a step back and look at rates over the long term, they're still below the historic average.

There is no federal law that limits the maximum credit card interest rate that a credit card company can charge. An exception would be a couple federal laws that limit interest rates charged for active duty servicemembers or their dependents.

Extensive Knowledge Of Usury Law

Usury is the charging of interest on loans at a rate that is higher than is permitted by state law. In Florida, the maximum permissible interest rate is 18% per annum.

What is the highest prime interest rate in US history? ›

What was the highest prime rate? The highest prime rate was 21.5%, reached on December 19, 1980.

Here is what it will mean for first-time homebuyers who fit certain income guidelines. For a homeowner with a $500,000 purchase price who puts down the minimum down payment, a person with a 660 credit score will get a rate of about 6.25% while a buyer with a 740 score will pay 6.5%.

The Federal Reserve

The Fed controls short-term interest rates by increasing them or decreasing them based on the state of the economy. While mortgage rates aren't directly tied to the Fed rates, when the Fed rate changes, the prime rate for mortgages usually follows suit shortly afterward.

What type of home loan has the lowest interest rate? VA loans typically have the lowest interest rates. However, the VA program is only available to eligible service members and veterans. For non-VA buyers with strong credit, a conventional loan will typically offer the lowest rates.

Key Data Points. Bank of America and Wells Fargo are two of the largest commercial banks in the country and two of the most asset-sensitive, meaning more of the yields on their assets such as loans reprice with the federal funds rate than do their liabilities such as deposits.

Buyers pay a long list of closing fees, all of which are itemized on the standard Loan Estimate you'll get from any lender. But the main (most expensive) fees to be aware of are: Loan origination fee or broker fee (0-1% of loan amount): A fee the lender or broker charges for its services.

Think about a no-closing-cost option

If you don't have the cash available to pay closing costs, you could consider a no-closing-cost option, if your lender offers it, usually in exchange for a higher interest rate.

Sellers typically pay more in closing costs, typically 6 percent and 10 percent of the home's sale price. Buyers generally pay around 2 percent to 5 percent of the home's purchase price. But while seller closing costs are often deducted from the proceeds of the home sale, buyers typically pay these costs out of pocket.

Will mortgage rates go down again in 2024? ›

Fannie Mae, Mortgage Bankers Association and National Association of Realtors expect mortgage rates to drop through the first quarter of 2024, by half a percentage point to about nine-tenths of a percentage point. Figures are the predicted quarterly average rates for the 30-year fixed-rate mortgage.

“We expect that 30-year mortgage rates will end 2023 at 5.2%,” the organization noted in its forecast commentary. It since has walked back its forecast slightly but still sees rates dipping below 6%, to 5.6%, by the end of the year.

Homes might be more affordable in 2024, but that doesn't mean you should wait to buy one. With U.S. home prices dropping and mortgage rates projected to dip sometime in 2024, homebuyers might be wondering if they should wait until next year to land a more affordable deal.

'I believe by the end of 2023 we will see rates start to fall with a target of between 2.5 to 3 per cent in 2024. 'I believe if the base rate can get back to circa 2.5 per cent, then we will see rates hovering around that mark with a return to products that have not been seen in the mortgage industry for some time.'

Beyond this year, the group expects mortgage rates to average 4.4% in both 2024 and 2025. Bank of America: Researchers at the investment bank expect mortgage rates to fall to 5.25% by the end of 2023.

The answer is yes — you can negotiate better mortgage rates and other fees with banks and mortgage lenders, if you're willing to haggle and know what fees to focus on. Many homebuyers start their house hunt focused on negotiating their home price, but don't spend as much time on their mortgage negotiation strategy.

Although ranges vary depending on the credit scoring model, generally credit scores from 580 to 669 are considered fair; 670 to 739 are considered good; 740 to 799 are considered very good; and 800 and up are considered excellent.

To get a 750 credit score, you need to pay all bills on time, have an open credit card account that's in good standing, and maintain low credit utilization for months or years, depending on the starting point. The key to reaching a 750 credit score is adding lots of positive information to your credit reports.

Can a person with a 500 credit score buy a 45k house? ›

Anyone with a minimum credit score of 500 can apply for an FHA loan. But if you already have a 620 or higher credit score, it makes more sense to go for a conventional mortgage.

Additionally, you'll need to maintain an “acceptable” credit history. Some mortgage lenders are happy with a credit score of 580, but many prefer 620-660 or higher.

While most lenders use the FICO Score 8, mortgage lenders use the following scores: Experian: FICO Score 2, or Fair Isaac Risk Model v2. Equifax: FICO Score 5, or Equifax Beacon 5. TransUnion: FICO Score 4, or TransUnion FICO Risk Score 04.

The credit limit you can get with a 750 credit score is likely in the $1,000-$15,000 range, but a higher limit is possible. The reason for the big range is that credit limits aren't solely determined by your credit score.

You can borrow $50,000 - $100,000+ with a 720 credit score. The exact amount of money you will get depends on other factors besides your credit score, such as your income, your employment status, the type of loan you get, and even the lender.

A “good” mortgage rate is different for everyone. In today's market, a good rate could be 6% for one borrower and 8% for another on the same day. To understand what a good mortgage rate looks like for you, get quotes from a few different lenders and compare them.

A 30-year fixed-rate home loan is a mortgage that will be completely paid off in 30 years if the homeowner makes all the payments as scheduled.

Anything at or below 3% is an excellent mortgage rate. And the lower, your mortgage rate, the more money you can save over the life of the loan.

With economic growth comes higher wages and greater consumer spending, including consumers seeking mortgage loans for home purchases. That's good for a country's economy, but the upswing in the overall demand for mortgages tends to propel mortgage rates higher. The reason: lenders only have so much capital to lend.

Is a 4% mortgage rate high? ›

Currently, a 4% mortgage rate would be considered low. If that question was asked at the beginning of 2022—when 30-year mortgage rates for conforming loans was 3.77%–instead of the end of 2022—when the same mortgage rates were 7.06%—the answer would have been, yes, a 4% mortgage rate is high.

In a recent survey by the New Home Trends Institute, 92% of current mortgage holders said they would not buy again if rates exceeded 7% — up from 85% who said the same at 6%. All of this means fewer homes for sale.

Con: Higher Interest Payments

By their nature, a longer-term loan means more time spent paying interest. Combined with the long repayment term, interest rate charges are higher on a 30-year mortgage than a 15-year one.

Higher interest rate: With a 30-year mortgage, most borrowers will have a higher interest rate than shorter-term fixed-rate mortgages. The longer a lender has to wait to be repaid, the bigger they deem the loan a risk, so they charge higher interest rates.

The lowest interest rate for a mortgage in history came in 2020 and 2021. In response to the COVID-19 pandemic and subsequent lockdowns, the 30-year fixed rate dropped under 3% for the first time since 1971, when Freddie Mac first began surveying mortgage lenders.

Fannie Mae, Mortgage Bankers Association and National Association of Realtors expect mortgage rates to drop through the first quarter of 2024, by half a percentage point to about nine-tenths of a percentage point. Figures are the predicted quarterly average rates for the 30-year fixed-rate mortgage.

According to MyFICO, as of November 2022, the average APR on a 60-month new auto loan for someone with a FICO Score of 720 or higher is 5.64%. With a score in the 690-719 range, it's 6.83%. And for a borrower with a score in the 660-689 tier, the average APR is 9.19%.

While it expects the Fed to continue increasing rates to tame inflation, it believes that long-term rates have already peaked. “We expect that 30-year mortgage rates will end 2023 at 5.2%,” the organization noted in its forecast commentary.

Most US Mortgages Are at Rates Below 4%

Things used to be different when more Americans had mortgages that carried variable interest rates. In a report this week, UBS economists estimated that the share of floating-rate debt in the US mortgage pile has shrunk to about 5%, from a peak of around 40% in 2006.

In addition to the rate, the type of mortgage you get matters. Although more than 90 percent of buyers opt for a 30-year fixed rate mortgage, financial expert and former CNBC host Suze Orman says home-buyers are overlooking an easy way to save big.