Top 10 Markets for Mortgage Overpayment: See Where Homebuyers Overpaid the Most in 2025
July 15, 2026
Bankrate finds every single metro area in the US is overpaying for mortgages. The homeowners paying the most were in Victoria and Tyler, Texas, followed by Los Angeles and Santa Fe, N.M.
NEW YORK – JULY 15, 2026 – Overpaying for your home mortgage is a national epidemic hitting consumers in the wallet. A new Bankrate analysis finds that U.S. homebuyers in every metro market are likely overpaying* for their mortgages. In 2025, about 87% of homebuyers did not get the lowest mortgage rate available to them, according to Bankrate research. As a result, the typical U.S. borrower may have paid an extra $3,343 annually, or $78,186 over the lifetime of their mortgage.
Bankrate has released the Top Ten worst markets for mortgage overpayment, and additional resources so communities can learn more about the cost savings options available. The new data shows that homebuyers in the Western regions of the country are the most likely to have overpaid for their mortgage in 2025.
To determine where American homebuyers are overpaying the most, Bankrate analyzed 3.2 million HMDA mortgage loan originations from 2025 and compared them against competitive offers available on Bankrate’s mortgage marketplace.
Bankrate’s team of consumer advocates and journalists helped compile the research, and additional information can be found at: http://www.bankrate.com/mortgages/where-homebuyers-overpay-mortgages/
“Borrowers in nearly every corner of the country are overpaying for their mortgages, but exactly how much you overpay depends heavily on your zip code,” said Alex Gailey, Bankrate’s Data Analyst. “High-priced coastal metros see the steepest overpayments in total dollars. But it’s not just a big city problem. Smaller markets in Texas and the Midwest face some of the worst rate markups in the country. No matter where you live, you hold the leverage to stop overpaying by comparison shopping.”
According to Bankrate’s analysis, borrowers in Victoria and Tyler, Texas, metro areas saw the largest gap between their mortgage rate and the most competitive Bankrate benchmark, plus average annual, 8-year and lifetime overpayments. In the top 10 metro areas with the widest gap, the average borrower is paying more than 1.1 percentage points higher on their mortgage rate relative to the market’s most competitive offers:
| Metro (Top 10) | Avg. Market Rate Spread (%)* | Avg. Annual Overpayment ($)* | Avg. 8-Year Overpayment ($) | Avg. Lifetime Overpayment ($) |
| 1. Victoria, TX | 1.24% | $2,841 | $22,729 | $63,038 |
| 2. Tyler, TX | 1.19% | $3,361 | $26,889 | $76,528 |
| 3. Los Angeles-Long Beach-Anaheim, CA | 1.18% | $6,075 | $48,599 | $149,073 |
| 4. Santa Fe, NM | 1.15% | $4,244 | $33,952 | $100,647 |
| 5. Elkhart-Goshen, IN | 1.14% | $2,607 | $20,854 | $61,705 |
| 6. La Crosse-Onalaska, WI-MN | 1.14% | $2,669 | $21,355 | $64,425 |
| 7. Santa Rosa-Petaluma, CA | 1.13% | $5,153 | $41,223 | $125,048 |
| 8. Corvallis, OR | 1.13% | $4,307 | $34,457 | $100,546 |
| 9. Santa Cruz-Watsonville, CA | 1.12% | $5,567 | $44,536 | $138,674 |
| 10. Kiryas Joel-Poughkeepsie-Newburgh, NY | 1.12% | $4,034 | $32,273 | $94,220 |
*Average market rate spread is the average difference between borrowers’ selected mortgage rates and the most competitive mortgage rates available in the market.
*Avg annual overpayment divides the 8-year expected overpayment by 8. This reflects the average mortgage lifespan and captures front-loaded amortization costs (interest and fees) more accurately than a 30-year average.
Among metro areas where borrowers’ actual mortgage rates were closest to Bankrate’s most competitive benchmark, homeowners in Rocky Mount, North Carolina, saw the smallest gap at just 0.65 percentage points, which could still result in an average annual overpayment of $2,108.
Rounding out the five metro areas with the smallest rate spread between their selected rate and the most competitive Bankrate benchmark are Lakeland-Winter Haven, FL, Dubuque, IA, Waterloo-Cedar Falls, IA, and Cedar Rapids, IA.
“The best thing you can do is break out of the single-quote loop,” Gailey said. “Instead of just checking with your bank or taking a quick recommendation, get multiple quotes from different lenders – ideally at least 3 and on the same day. Having that direct comparison is what will empower you to secure the best mortgage rate and could save you an average of over $3,300 a year, according to our research.”
Methodology
To determine where homebuyers are overpaying the most, Bankrate analyzed 3.2 million HMDA mortgage loan originations from 2025 and compared them against binding, competitive offers available on Bankrate’s marketplace across more than 350 metro areas.
Mortgage overpayment is defined as the extra money a borrower is projected to pay in interest and upfront costs for a mortgage because they missed out on the most competitive deal available*
The analysis extracted data from four key sources: Bankrate’s mortgage marketplace, the Home Mortgage Disclosure Act (HMDA) loan-level dataset, the Federal Reserve’s Survey of Consumer Finances (SCF) and loan-level disclosure data from Freddie Mac and Ginnie Mae. Together, these sources allowed us to account for competitive pricing, loan originations, borrower credit profiles and household wealth.
To ensure a fair and accurate comparison, we looked at buyers with similar credit scores, down payments, loan amounts and locations to identify the gap between the best available market rate and the rate that borrowers locked in. The data takes into account borrowers who are both purchasing and refinancing a home. Our statistical model controlled for 17 different factors that can influence a mortgage rate, including:
- Loan characteristics: The size of the loan, the length of the term, whether it was a fixed or adjustable rate, upfront fees and the specific loan program (conventional, FHA or VA).
- Borrower’s financials: Credit scores, income, debt-to-income ratios and the down payment size.
- Property and background details: The borrower’s age, race, ethnicity, sex, the type of property and local state-level market trends.
Once loans were compared across datasets, we calculated four metrics:
- Average rate spread (%): The average gap between borrowers’ actual mortgage rate and the most competitive Bankrate benchmark.
- Average 8-year overpayment ($): We added up the interest paid during the first eight years of the mortgage (average duration of a mortgage), taking into account upfront lender fees, discount points and lender credits. We then subtracted what the borrower would have paid during that same timeframe with a competitive Bankrate offer.
- Average lifetime overpayment ($): We calculated the full cost of the mortgage (all 30 years of interest payments, including upfront lender fees, discount points and lender credits) and subtracted the total cost of the matched, competitive Bankrate offer.
- Average annual overpayment ($): We divided the 8-year expected overpayment by 8. This reflects the average mortgage lifespan and captures front-loaded amortization costs (interest and fees) more accurately than a 30-year average.
For more detailed information on the methodology and the analysis, see Bankrate’s research on the hidden homeownership tax.
About Bankrate:
Bankrate is where Americans go to get the best price on life’s most important financial decisions. By combining proprietary data, advanced technology, and deep market coverage, Bankrate helps consumers compare options and make confident financial choices across mortgages, credit cards, savings, and more. As a rate provider to the Federal Reserve and the benchmark relied upon by major publishers and policymakers nationwide, Bankrate’s rate data is the national standard. This commitment to precision is reflected across all its products. In mortgages, proprietary auction technology puts lenders in real-time competition on price alone, consistently delivering rates in the lowest 10% in the country. For deposits, the platform features exclusively top-tier rates in the top 10% nationally, while its credit card coverage encompasses more than 90% of the market by volume. Founded by a journalist, Bankrate remains dedicated to its founding mission of transparency, honest information, and real competition — helping to make the American dream more affordable for everyone.
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For more information:
Alexandria Cremer
Public Relations Manager, Bankrate
acremer@bankrate.com | 704.426.3684