For inquiries related to this message, please contact our support team and provide the reference identifier below. At a more granular level, each mortgage applicant is evaluated based on their credit score, work history, income, existing debts, and other factors, all of which influence the rate a lender will offer you. The federal government's inability to agree on a coronavirus relief package has been good for mortgage rates. Fifteen-year fixed mortgage rates tend to be lower, which means you pay less interest for the life of the loan.
Monetary policies set by the Federal Reserve can also have a significant impact on mortgage rates, even if you don't directly set them. Since 1971, historical mortgage rates for 30-year fixed-rate loans have reached record highs and lows due to several factors. Let's take a look at historical mortgage rate trends over the past few years and discuss what that means for you. Fixed mortgage rates are influenced by the 10-year Treasury yield and, more generally, by Federal Reserve policy, which affects borrowing costs for banks that then pass on to borrowing customers.
Fixed-rate mortgages are the most common type of loan because the stable interest rate means predictable monthly payments over the life of the loan. While each lender has different standards, having a down payment of at least 20% and a credit score of 700 to 740 will generally allow you to get the lowest mortgage rate. Since March, the Fed has been buying mortgage-backed securities in unprecedented amounts, lowering mortgage rates. View competitive mortgage rates from lenders that match your criteria and compare your offers side by side.
That's why it's important to pay attention to the economic impact of COVID variants when it comes to understanding mortgage rate trends. Mortgage rate forecasts predict a continued increase by the end of the year, which some attribute to inflation driven by temporary supply chain problems. While the mortgage interest rate is the highest long-term cost associated with a home loan, it's not the only expense you need to pay attention to. If you compare loan offers from mortgage lenders, you'll have a better chance of getting a competitive rate.
Looking at all of Freddie Mac's available historical mortgage rate data, a trend becomes evident.