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Mortgage
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Complete guide to mortgages
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Mortgage
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Use our national survey of lenders to find the right mortgage rate for you.
We regularly survey around 4,800 banks and lenders to give you a comprehensive, up-to-date comparison.
When you find a few lenders you like, click to get a personalized rate quote based on your home purchase.
Once you choose a bank or lender, you'll apply for a mortgage directly with them. Then, you'll be on your way to your new home.
Bankrate brings together a comprehensive national survey of mortgage lenders to help you find the most competitive interest rate. The interest rate table below is updated daily, Monday through Friday, to give you the most current purchase rates when choosing a home loan.
On October 23, 2019, according to Bankrate’s latest survey of the nation’s largest mortgage lenders, the benchmark 30-year fixed mortgage rate is 3.82 percent with an APR of 3.94 percent. The average 15-year fixed mortgage rate is 3.22 percent with an APR of 3.43 percent. The 5/1 adjustable-rate mortgage (ARM) rate is 4.07 percent with an APR of 7.15 percent.
| Product | Interest Rate | APR |
|---|---|---|
| 30-Year Fixed Rate | 3.82% | 3.94% |
| 20-Year Fixed Rate | 3.75% | 3.91% |
| 15-Year Fixed Rate | 3.22% | 3.43% |
| 30-Year FHA | 3.40% | 3.48% |
| 30-Year VA | 3.45% | 3.52% |
| 5/1 ARM | 4.07% | 7.15% |
| 7/1 ARM | 3.99% | 6.38% |
| 10/1 ARM | 4.26% | 6.01% |
| 30-Year Fixed Rate Jumbo | 4.20% | 4.31% |
| 15-Year Fixed Rate Jumbo | 3.99% | 4.20% |
| 5/1 ARM jumbo | 4.11% | 7.20% |
| 7/1 ARM jumbo | 3.95% | 6.33% |
Rates as of 10/23/2019 at 6:30 AM
| Product | Interest Rate | APR |
|---|---|---|
| 30-Year Fixed Rate | 3.750% | 3.853% |
| 15-Year Fixed Rate | 3.000% | 3.199% |
| 5/1 ARM | 3.000% | 3.905% |
Rates as of 10/23/2019
| Product | Interest Rate | APR |
|---|---|---|
| 30-Year Fixed Rate | 3.750% | 3.915% |
| 15-Year Fixed Rate | 2.875% | 3.242% |
| 5/1 ARM | 2.750% | 3.899% |
Rates as of 10/23/2019
| Product | Interest Rate | APR |
|---|---|---|
| 30-Year Fixed Rate | 3.990% | 4.247% |
| 15-Year Fixed Rate | 3.375% | 3.859% |
| 5/1 ARM | 3.750% | 4.390% |
Rates as of 10/23/2019
| Product | Interest Rate | APR |
|---|---|---|
| 30-Year Fixed Rate | 3.625% | 3.724% |
| 15-Year Fixed Rate | 2.990% | 3.136% |
| 5/1 ARM | 2.875% | 3.851% |
Rates as of 10/23/2019
A mortgage is a loan from a financial institution that lets you purchase a house without paying the entire amount upfront. A mortgage is secured by the home itself, so the bank can sell the home and recoup the money it loaned to you if you default on the loan.
In a mortgage agreement, a borrower agrees to a set length of time to repay the money, at a certain interest rate and under specific terms, and makes payments in equal monthly installments.
There are three main types of mortgages:
Fixed-rate mortgages are the most common mortgage type. The interest rate remains the same for the life of the loan. With a fixed-rate mortgage, your monthly payment won't change (outside of property taxes, insurance premiums or homeowner's association fees).
Adjustable-rate mortgages, or ARMs, have an initial fixed-rate period during which the interest rate doesn't change, followed by a longer period during which the rate may change at preset intervals. Generally, interest rates are lower to start than with fixed-rate mortgages, but they can rise, and you won't be able to predict future monthly payments.
Jumbo mortgages are conventional loans that have non-conforming loan limits. This means the home prices exceed federal loan limits. For 2019, the maximum conforming loan limit for single-family homes in most of the U.S. is $484,350, according to the Federal Housing Finance Agency. Jumbo loans are more common in higher-cost areas and generally require more in-depth documentation to qualify.
Government-insuraed loans are backed by three agencies: the Federal Housing Administration (FHA loans), the U.S. Department of Agriculture (USDA loans) and the U.S. Department of Veterans Affairs (VA loans). The U.S. government isn’t a mortgage lender, but it sets the basic guidelines for each loan type offered through private lenders.
You can find more information in the article, 5 Types of Mortgage Loans for Homebuyers.
Mortgages come in various repayment terms, including fixed-rate loans of 10, 15, 20, 30 or 40 years. Another option is an adjustable-rate mortgage, or ARM, which has an initial, fixed-rate interest period of three, five, seven or 10 years. After the initial time frame, an ARM resets and interest rates can go up or down for the remaining life of the loan.
The mortgage you choose depends on a variety of factors, including your credit history and score, debt-to-income ratio, down payment amount and employment history. It also depends on how long you play to stay in the home, what type of property you’re interested in, and if you meet the lender’s borrowing requirements.
Narrowing your loan choices can be difficult. Here’s a list of pros and cons of each of the options mentioned earlier to help you decide.
| Pros | Cons | Who it's best for | |
|---|---|---|---|
| Fixed-rate mortgages | Pros
|
Cons
|
Who it's best for
Borrowers who plan to stay in a home many years and want predictable, stable payments at the same interest rate for the life of the loan. |
| Adjustable-rate mortgages | Pros
|
Cons
|
Who it's best for
Borrowers who don’t plan to stay in a home for more than a few years -- especially when rates are higher. |
| Conventional mortgages | Pros
|
Cons
|
Who it's best for
Borrowers with strong credit, a stable income and employment history, and a down payment of at least 3 percent. |
| Government-insured mortgages | Pros
|
Cons
|
Who it's best for
Borrowers who have low cash savings, less-than-stellar credit or can’t qualify for a conventional loan. VA loans tend to offer the best terms and most flexibility compared to other loan types for military borrowers. |
| Jumbo mortgages | Pros
|
Cons
|
Who it's best for
Affluent borrowers purchasing a high-end home who also have good to excellent credit, high incomes and a substantial down payment. |
Whether it's a conventional, FHA, or VA loan, find out which mortgage is the best for you.
To find the best mortgage rate, shop around with at least three different lenders to compare products and rates. Typically, the higher your credit score and the less debt you have, the more competitive interest rates lenders can offer.
The annual percentage rate, or APR, includes the interest rate and all other borrowing costs, such as mortgage insurance and other loan fees, and is expressed as a percentage. It gives you an overall idea of the loan’s true borrowing costs. The interest rate is a fee a lender charges you to borrow the principal loan amount. It can be variable or fixed, but it’s always expressed as a percentage.
Find out more about the difference between interest rates and APR.
The first step in getting a mortgage is to get preapproved, and it’s best to do this before you start looking at homes. A preapproval might reveal you need to work on credit issues or pay down debt, so it’s best to speak to a lender as early as possible to identify -- and resolve -- potential obstacles.
The maximum loan amount will vary depending on the type of mortgage you choose, federal loan limits and the specific down payment requirements for the type of mortgage you want. For example, VA and USDA loans allow you to finance 100 percent of the home’s purchase price, while FHA loans require 3.5 percent down and conventional loans require at least 3 percent down.
Refinancing a mortgage makes sense if you can get a lower interest rate than your current mortgage to lower your payments, or to shorten your loan term and cut interest payments significantly. Like getting a new mortgage, refinancing requires a loan application, and you must have at least 20 percent equity in your home, either through paying down your principal loan balance or because your home’s value has increased since you bought it.
Estimate the mortgage amount that best fits your budget.
Calculate what your mortgage payment will be and how much you can afford.
Estimate the mortgage amount that best fits your budget.
Determine how much of your monthly payment will go toward the principal and how much will go towards interest.
