Unlock the Best 30-Year Mortgage Rates: Today’s Top Comparisons!

In 2024, the interest rates for 30-year mortgage loans have been dancing between the mid-6% and low-7% range. While they took a slight dip in August and September, they’ve bounced back to this familiar territory. Rates have been on an upward trend recently, but there’s a silver lining: this week, they dropped by three basis points to an average of 6.81%, according to Freddie Mac.

Despite recent increases, current rates are actually 41 basis points lower than they were a year ago. While the Federal Reserve is gradually cutting the federal funds rate, the road ahead appears bumpy. With the presidential election looming, expect fluctuations in rates as the political landscape shifts. If you’re contemplating a 30-year mortgage, now might just be the right moment to seize the opportunity — even if the numbers fluctuate a bit, a significant drop isn’t on the horizon anytime soon.

In this article:

Read more: Should you lock in a mortgage rate — and if so, when?

As per the latest figures from Freddie Mac, the average 30-year mortgage rate stands at 6.84%. This marks a six basis point uptick from last week and surpasses the October high of 6.72%. However, it’s still a notable improvement compared to last year’s rates.

If you’re considering a mortgage of $400,000 (which is close to the median-priced home in the U.S.), here’s how your payments would compare over the past year:

With today’s rates, you’ll find yourself paying $111 less than if you had locked in at the peak earlier this year. However, it’s worth noting that you’ll be shelling out $21 more than if you had paid the 52-week average rate. Keep in mind, these amounts pertain only to the principal and interest — they don’t factor in homeowners insurance, property taxes, mortgage insurance, or any homeowners’ association dues.

Dig deeper: PITI (principal, interest, taxes, insurance) and how it affects your mortgage payments

Check out the current 30-year fixed purchase rates compared to other mortgage options. These are national averages for home purchases, as sourced from Zillow:

• 30-year fixed: 6.45%

• 30-year VA: 5.85%

• 30-year FHA: 5.58%

• 20-year fixed: 6.24%

• 15-year fixed: 5.82%

• 15-year VA: 5.44%

• 7/1 ARM: 6.69%

• 5/1 ARM: 6.60%

• 5/1 VA: 6.15%

Here are the current 30-year refinance rates according to Zillow:

• 30-year fixed: 6.53%

• 30-year VA: 5.89%

• 20-year fixed: 6.35%

• 15-year fixed: 5.90%

• 15-year VA: 5.80%

• 7/1 ARM: 6.55%

• 5/1 ARM: 6.05%

• 5/1 VA: 5.51%

Keep in mind that mortgage refinance rates are often higher than purchase rates, though this isn’t a hard and fast rule. Additionally, these rates are national averages, meaning your individual interest rate could vary based on your location, credit score, debt-to-income ratio (DTI), down payment, and lender choice.

Dig deeper: The best mortgage refinance lenders

To help you navigate the mortgage landscape, utilize the Yahoo Finance mortgage calculator. This tool will clarify what today’s rates mean for your home-buying or refinancing plans, guiding you on price ranges, down payments, and potential escrow costs beyond just your principal and interest payments.

Learn more: How much house can you afford? Use Yahoo Finance’s home affordability calculator.

The 30-year fixed-rate mortgage is undoubtedly the reigning champion of home loans in America — and it’s easy to see why.

But every rose has its thorns. Here are the key pros and cons you should weigh before diving into a 30-year fixed-rate loan.

• Low monthly payments: When you spread your loan across three decades, your monthly payments are naturally lower than if you opt for a shorter term.

• Potentially larger home-buying budget: Those lower monthly payments might allow you to borrow more, expanding your home-buying options to snag that dream house.

• A steady interest rate: With a fixed-rate mortgage, your interest rate stays the same for the entire term, making budgeting a breeze.

• More financial flexibility: The lower monthly payments provide a financial cushion, great for unexpected expenses or sudden job changes.

• Tax benefits for longer: You can deduct the interest on your mortgage (provided you itemize). With a 30-year loan, you enjoy this perk for an extended period.

• Higher interest rates: Expect to pay more, as 30-year loans generally come with higher interest rates than 15-year mortgages.

• Pay more in long-term interest: Stretching your payments over three decades means you’ll likely end up paying more in interest overall.

• Slow equity build-up: Initially, most of your payments go toward interest, so building equity in your home takes time.

• Temptation to over-borrow: Those low monthly payments can entice you to borrow more than you can afford, which could lead to financial stress later on.

Read more: Comparing 30-year vs. 15-year mortgages

Keep in mind, the rates mentioned are merely averages. Your specific rate can differ significantly based on personal factors such as credit score, loan amount, and more.

Here are some savvy strategies to snag the best mortgage rate:

• Improve your credit score: A higher score generally translates to a better rate.

• Make a larger down payment: Putting more money down reduces the risk for lenders and typically earns you a lower rate.

• Shop around for your lender: Rates and fees can vary wildly among lenders, so it pays to compare several options. Freddie Mac estimates you could save around $1,200 per year by gathering just four quotes.

• Buy points: Consider paying an upfront fee for mortgage points to secure a lower rate for the life of the loan. These points usually cost around 1% of your loan amount.

• Look for buydowns: Some lenders may offer temporary rate reductions for the first couple of years. This could be a great option in today’s rate environment.

Working with a mortgage broker can also be beneficial. They can help you sift through various lenders, loan programs, and rates to ensure you get the best fit for your needs. Typically, they receive a commission from the lender you select.

Learn more: How a float-down option lowers your locked-in mortgage rate

As you navigate the mortgage landscape, you’ll notice some lenders highlight a 30-year mortgage “interest rate” while others promote an “APR.” While these terms are related, they convey different information.

The mortgage interest rate is the annual cost of borrowing, while the APR (annual percentage rate) encompasses the total yearly cost of the loan, including interest, points, fees, and other charges. Understanding this distinction is key to evaluating your loan options effectively.

Dig deeper: Mortgage APR vs. interest rate

Currently, the average 30-year mortgage rate is 6.81%, with Freddie Mac updating its data every Thursday. (Note: Thanksgiving week saw an earlier release this week.)

The lowest average 30-year mortgage rate ever recorded was 2.65%, back in January 2021. In stark contrast, the highest was a staggering 18.63% in October 1981.

Looking ahead, we don’t expect significant drops in 30-year mortgage interest rates in 2024. Instead, volatility and potential increases could be on the agenda as the year closes out.