Mortgage rates have climbed above 7%, adding hundreds of dollars a month to payments for many Americans looking to buy a home.
30-year mortgage rate today: Monthly payments on a $300K to $600K home
Mortgage rates are above 7%. See estimated monthly payments for $300K, $400K, $500K and $600K homes.
If buying a home feels more expensive than it did a year ago, the latest mortgage rates help explain why.
The average 30-year fixed mortgage rate has climbed above 7%, reaching its highest levels in about a year. According to Freddie Mac, the average 30-year fixed-rate mortgage was 7.03% as of Sept. 24, up from 6.30% a year ago. Forbes Advisor, citing data from the Mortgage Research Center, reported an average 30-year mortgage rate of 7.37% on Sept. 29.
“The housing market remains supported by a solid labor market and an economy that is growing at a healthy rate,” Freddie Mac said in its latest mortgage rate update, noting that the average 30-year fixed-rate mortgage rose to 7.03% from 6.95% the week before.
For buyers, even a small jump in rates can have a big impact. A difference of less than one percentage point can add hundreds of dollars to a monthly mortgage payment and reduce how much house buyers can afford.
What is the 30-year mortgage rate today?
Freddie Mac‘s latest weekly survey found the average 30-year fixed mortgage rate at 7.03%, up from 6.95% the previous week and 6.30% a year earlier. Meanwhile, Forbes Advisor reported the average rate on a 30-year fixed mortgage had risen to 7.37%, describing it as a one-year high.
How much is a monthly mortgage payment now?
Assuming a 20% down payment and a 30-year fixed mortgage, here’s how monthly principal-and-interest payments compare at last year’s average rate of 6.30% versus today’s 7.37%.
| Home Price | 20% Down | Loan Amount | Payment at 6.30% | Payment at 7.37% | Monthly Increase |
|---|---|---|---|---|---|
| $300,000 | $60,000 | $240,000 | $1,486 | $1,657 | $171 |
| $400,000 | $80,000 | $320,000 | $1,981 | $2,209 | $228 |
| $500,000 | $100,000 | $400,000 | $2,476 | $2,761 | $285 |
| $600,000 | $120,000 | $480,000 | $2,971 | $3,314 | $343 |
A buyer purchasing a $400,000 home with 20% down would pay about $2,209 a month in principal and interest at 7.37%, compared with about $1,981 a month at 6.30%.
Note: These figures are estimates of principal and interest only and do not include property taxes, homeowners insurance, PMI, HOA fees or closing costs. Buyers who put down less than 20% on a conventional loan may also be required to pay private mortgage insurance, increasing the total monthly payment.
How much is a mortgage payment for a first-time homebuyer?
Many first-time buyers put down far less than 20%. Using the 3.5% minimum down payment, commonly associated with FHA loans, monthly payments climb because buyers are financing a larger portion of the purchase price. FHA loans allow qualified borrowers to purchase a home with as little as 3.5% down.
| Home Price | 3.5% Down | Payment at 6.30% | Payment at 7.37% | Monthly Increase |
|---|---|---|---|---|
| $300,000 | $10,500 | $1,792 | $1,999 | $207 |
| $400,000 | $14,000 | $2,389 | $2,665 | $276 |
| $500,000 | $17,500 | $2,987 | $3,331 | $344 |
| $600,000 | $21,000 | $3,584 | $3,997 | $413 |
For a first-time buyer purchasing a $400,000 home with 3.5% down, the estimated monthly principal-and-interest payment would be about $2,665 at today’s rates, roughly $276 more than at last year’s average rate.
Note: These figures do not include property taxes, homeowners insurance, mortgage insurance, HOA fees or closing costs. Many first-time buyers using FHA financing would also pay mortgage insurance premiums, increasing the total monthly cost.
Why are mortgage rates rising?
Mortgage rates remain elevated as financial markets react to inflation concerns, economic growth and expectations about future interest-rate policy.
Freddie Mac said the housing market continues to be supported by a strong labor market and a growing economy, even as borrowing costs remain high.
What do today’s mortgage rates mean for buyers?
Higher rates reduce buying power, forcing many buyers to either lower their budgets, increase their down payments or accept higher monthly payments.
For a buyer financing a $400,000 home with 20% down, today’s rates can mean paying about $228 more per month than they would have at last year’s average mortgage rate. For first-time buyers putting down just 3.5%, the increase jumps to roughly $276 a month.
Maria Francis is a Pennsylvania-based journalist covering trending and breaking topics across the Mid-Atlantic and Northeast regions for USA Today Network. Reach her at mfrancis@usatodayco.com.
