Mortgage Rate

Mortgage rates are influenced by a mix of macroeconomic factors and your personal financial profile. Nationally, rates track the 10-year U.S. Treasury yield and are shaped by Federal Reserve policy, inflation expectations, and bond market activity. Personally, your credit score, loan-to-value ratio, loan type, and whether you're buying or refinancing all affect your specific rate.

Lenders quote two numbers: the interest rate and the APR (annual percentage rate). The APR includes fees rolled into the cost calculation, making it a better apples-to-apples comparison between lenders. Getting rate quotes from a direct lender and comparing them against broker-sourced offers is the most reliable way to confirm you're seeing the full market, since direct lenders set their own rates while brokers access wholesale pricing. A loan with a 7.0% rate and high fees might have a 7.4% APR, while a no-cost loan at 7.3% has an APR of 7.3%. Compare APRs when shopping.

You can lower your rate by paying discount points at closing. One point equals 1% of the loan amount and typically reduces the rate by 0.25%. On a $400,000 loan, one point costs $4,000. To evaluate whether buying points makes sense, calculate your break-even: divide the upfront cost by your monthly savings. If you'll stay in the home longer than the break-even period, buying points saves money.