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What Is the Lowest Interest Rate for a Mortgage?

Interest ratesNot only should you compare lenders for the "lowest" interest rate, but also for the most favorable mortgage conditions.

Some lenders may charge somewhat higher loan rates yet charge reduced closing fees.
Here is a comparison table of lenders eager to talk with you about financing your new home or refinancing your existing mortgage.


Did you know that your interest rate is determined by your credit score?
Continue reading to learn more

What exactly is a rate lock? What is the maximum amount of time you can "freeze" an interest rate? Continue reading to learn more

Did you know that you can use discount points to "buy down" an interest rate, and the seller is permitted to pay those points?
Continue reading to learn more

Current home mortgage interest rates

Fixed-rate mortgage

Your interest rate on a fixed-rate mortgage will not change throughout the term of the loan (i.e. 5, 10, 15, 20, 25, 30, or 40 years).

Because the lender is more at risk if interest rates rise over the duration of your mortgage, the interest rate is typically greater than on other kinds of mortgages. As a result, the lender has included a little buffer in the fixed-rate mortgage. From the first to the final payment, the mortgage payment will be the same.The most conservative payment option is a fixed-rate mortgage.

Adjustable-rate mortgage

The adjustable-rate-mortgage rate may “adjust,” as the term suggests. Variable rate mortgages are another name for adjustable-rate mortgages. A variety of adjustable-rate mortgages are available.

The interest rate on a one-year adjustable-rate mortgage (ARM) will vary or change every 12 months, for example. The interest rate may increase, decrease, or stay unchanged.

The hybrid mortgage is another kind of adjustable-rate mortgage. This adjustable-rate mortgage has a fixed rate for three, five, seven, or ten years before switching to a one-year adjustable rate. The benefit of this mortgage is a consistent, predictable monthly payment that is fixed for a certain period of time (e.g., 3, 5, 7, or 10 years) before the interest rate changes. Adjustable-rate mortgages often have lower interest rates than fixed-rate mortgages.

What is a balloon mortgage?

A balloon mortgage is a home loan with a fixed monthly payment for a certain period of time, typically five or seven years, after which the loan balance is due.

When a debt "balloons," the borrower has two options: pay off the amount or refinance it. Find out more about balloon mortgages

Bimonthly mortgage

A bi-monthly mortgage is one in which half of the monthly mortgage payment is made twice a month. The total interest paid to the lender is reduced when a loan is paid in two installments.

Biweekly mortgage

One-half of a biweekly mortgage payment is made every two weeks.
If your monthly payment is $500, for example, your 12 payments will total $6,000 (12 weeks X $500 = $6,000).
The bi-weekly payment schedule results in 26 payments per year (26 weeks x $250 = $6,500). The additional money each year helps to pay down the mortgage more quickly.

Interest only mortgage

If the monthly mortgage payment does not include any principal payments, the mortgage is considered "interest only. The loan balance stays unchanged if the payment is just interest. Find out more about interest only mortgages