Mortgage Rates Today: March 7, 2024—Rates Move Down

The average rate on a 30-year fixed mortgage fell by 0.13 percentage point in the last week to 7.42%.

Meanwhile, the APR on a 15-year fixed mortgage dropped 0.18 percentage point during the same period to 6.60%.

For existing homeowners, compare your current mortgage rates with today’s refinance rates.

Current Mortgage Rates for March 7, 2024

30-Year Mortgage Rates

Today’s average rate on a 30-year mortgage (fixed-rate) slipped to 7.42% from 7.46% yesterday. One week ago, the 30-year fixed was 7.55%.

The 30-year fixed mortgage APR is 7.33%. At this time last week, it was 7.33%. Here’s why APR is important.

At today’s interest rate of 7.42%, borrowers with a 30-year fixed-rate mortgage of $100,000 will pay $693 per month in principal and interest (taxes and fees not included), the Forbes Advisor mortgage calculator shows. The total interest paid over the life of the loan will be around $149,650.

15-Year Mortgage Rates

Today’s 15-year mortgage (fixed-rate) is 6.60%, down 0.18 percentage point from the previous week. The same time last week, the 15-year, fixed-rate mortgage was at 6.78%.

The APR on a 15-year fixed is 6.55%. It was the same last week.

A 15-year, fixed-rate mortgage with today’s interest rate of 6.60% will cost $877 per month in principal and interest on a $100,000 mortgage (not including taxes and insurance). In this scenario, borrowers would pay approximately $57,820 in total interest.

Jumbo Mortgage Rates

The current average interest rate on a 30-year, fixed-rate jumbo mortgage is 7.31%— 0.15 percentage point down from last week. The 30-year jumbo mortgage rate had a 52-week APR low of 5.00% and a 52-week high of 10.50%.

A 30-year jumbo mortgage at today’s fixed interest rate of 7.31% will cost you $686 per month in principal and interest per $100,000. On a $750,000 jumbo mortgage, the monthly principal and interest payment would be approximately $5,146.

How To Calculate Mortgage Payments

Mortgages and mortgage lenders are often a necessary part of purchasing a home, but it can be tricky to understand what you’re paying for—and what you can actually afford.

Using a mortgage calculator can help you estimate your monthly mortgage payment based on your interest rate, purchase price, down payment and other expenses.

Here’s what you’ll need in order to calculate your monthly mortgage payment:

  • 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?

Many home buyers are eligible for several mortgage loan types. Each program can have its own advantages:

  • Conventional mortgage. A conventional home loan is ideal for borrowers with good or excellent credit to qualify for competitive rates. Additionally, making a minimum 20% down payment helps you waive private mortgage insurance premiums.
  • FHA loan. An FHA home loan is best when applying with imperfect credit or a low down payment. You can put as little as 3.5% down with a credit score above 580. A minimum 10% down payment is necessary for credit scores ranging from 500 to 579.
  • VA loan. Borrowers with a qualifying military background may prefer a VA loan for its flexibility. A down payment may not be required. While you pay a one-time funding fee, there are no ongoing mortgage insurance premiums or service fees.
  • USDA loan. Applicants in eligible rural areas can buy or build a home with no down payment, although an upfront and annual guarantee fee applies. Additionally, income requirements apply and this program requires a moderate income or lower.
  • Jumbo loan. Homebuyers in a high-cost-of-living area will need to apply for a jumbo loan when the loan amount exceeds the Federal Housing Finance Agency’s conforming loan limits. The limit in most municipalities is $726,200 in 2023.

Frequently Asked Questions (FAQs)

What is a good mortgage rate?

A competitive mortgage rate currently ranges from 6% to 8% for a 30-year fixed loan. Several factors impact mortgage rates, including the repayment term, loan type and borrower’s credit score.

How to get a lower mortgage interest rate?

Comparing lenders and loan programs is an excellent start. Borrowers should also strive for a good or excellent credit score between 670 and 850 and a debt-to-income ratio of 43% or less.

Further, making a minimum down payment of 20% on conventional mortgages can help you automatically waive private mortgage insurance premiums, which increases your borrowing costs. Buying discount points or lender credits can also reduce your interest rate.

How long can you lock in a mortgage rate?

Most rate locks last 30 to 60 days and your lender may not charge a fee for this initial period. However, extending the rate lock period up to 90 or 120 days is possible, depending on your lender, but additional costs may apply.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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