Today Mortgage Rates
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What are today’s mortgage rates?
On Friday, September 1, 2023, the national average APR for a 30-year fixed-rate mortgage is 7.561%, an increase of 12 basis points from a week ago. Meanwhile, the average APR for a 15 year fixed-rate mortgage increased by 3 basis points to 6.848%, and the average APR for a 5-year Adjustable Rate Mortgage (ARM) increased by 4 basis points to 6.917%, according to rates provided to Redfin by icanbuy.
How we calculate average rates
What is a basis point?
What’s the difference between APR and interest rate?
Mortgage rate trends
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Average APR
September 1, 2023
| 30-year fixed | 7.561% | |
| 15-year fixed | 6.848% | |
| 5-year ARM | 6.917% |
Current mortgage rates by loan type
The table below is updated daily with average rates for common loan types. These averages are based on a 20% down payment and 740+ credit score.
| Product | Interest Rate | APR |
|---|---|---|
| 30-year fixed | 7.538% | 7.561% |
| 20-year fixed | 7.396% | 7.425% |
| 15-year fixed | 6.813% | 6.848% |
| 10-year fixed | 6.773% | 6.823% |
| 10-year ARM | 7.313% | 7.326% |
| 7-year ARM | 7.246% | 7.259% |
| 5-year ARM | 6.904% | 6.917% |
| 3-year ARM | 6.984% | 6.997% |
| 30-year fixed FHA | 7.162% | 8.282% |
| 30-year fixed VA | 7.127% | 7.369% |
How are mortgage rates determined?
Mortgage rates depend on the loan terms, the type of loan, credit score, debt-to-income ratio, and employment history. For example, lenders may offer you better mortgage rates if they see a very good or exceptional credit score. They may also give you a better rate if you have a larger down payment. Both of these scenarios lessen the risk to the lender; therefore, they can be generous on the mortgage rate. Mortgage lenders set rates on a borrower-by-borrower basis. They’re determined by a combination of market factors, such as how the current U.S. economy is doing, and personal factors such as the mortgage loan type and terms you choose, your credit score, and down payment amount. Before any personal factors can be considered, mortgage rates are first affected by outside financial factors such as inflation and U.S. economic growth.
| Mortgage rates typically increase when | Mortgage rates typically decrease when |
|---|---|
| The number of homes for sale is increasing | The number of homes for sale is decreasing |
| The economy is growing | The economy is slowing down |
| Unemployment is low | Unemployment is high |
| Inflation is up | Inflation is down |
How does the Federal Reserve affect mortgage rates?
How to get the best mortgage rate
Here are the top eight things you can start doing now to increase your chances of getting a good interest rate on your home loan:
Improve your credit score: Borrowers with higher credit scores tend to get lower interest rates because they’re considered less risky. This is because high credit scores typically mean you consistently make regular, on-time payments towards any debts you may have, such as credit card payments or against other loans. If you have a low score, you’ll want to improve it before applying for a mortgage. There are many actions you can take to improve your credit score, such as paying your bills on time and carrying a balance of only 20-30% of your available credit limit. You may also have errors or issues on your credit report that could be impacting your score, such as an unpaid bill from the past you were unaware of. Fixing those issues can help your credit score improve quickly and eliminate hassles when you apply for a mortgage.
Keep steady employment: You’ll typically get a lower interest rate if you can show you’ve had two years or more of steady employment. If not, you may need to explain any work gaps or times when you were unemployed. If you’re self-employed, you’ll need to show two years of self-employment as well.
Increase your down payment: Though you may not need a 20% down payment, putting more money down towards your home purchase increases your likelihood of getting a good mortgage rate.
Consider a 15-year mortgage: While 30-year fixed mortgages are common, if you have the funds, consider a 15-year fixed-rate mortgage as this can help lower your interest rate. However, keep in mind that a shorter-term loan means your monthly payment will be higher.
Look into first-time homebuyer programs: There are many national, state, and city first-time homebuyer programs designed to spur homeownership in local areas. Some of these come in the form of low-interest mortgage loans.
Shop multiple lenders: One of the best ways to get a good mortgage rate is to shop around, but make sure to compare APRs and look out for any hidden fees.
Consider discount points: Discount points are basically a fee you can pay at closing to reduce your mortgage interest rate. Paying points can be worth it if you keep your mortgage long enough. If you refinance or sell within a few years, paying points may not be worthwhile. Your lender can help you decide.
Lock in your rate: Sometimes the closing process takes several weeks, and during this time rates can fluctuate. After you sign the home purchase agreement and have secured your loan, ask your lender to lock in your mortgage rate