What we verified in “Mortgage interest rates: fixed, adjustable, points and APR”

Statements and where we checked them

The statements with rules, figures or dates, with the exact place in the source and the date we checked them.

1. According to the CFPB, the interest rate is the cost you pay each year to borrow the money, expressed as a percentage, and it does not reflect fees or other charges for the loan.

   Sources 1 · What is the difference between a mortgage interest rate and an APR? (last reviewed Aug 28, 2026): 'The interest rate is the cost you will pay each year to borrow the money, expressed as a percentage rate'; 'It does not reflect fees or any other charges you may have to pay for the loan' · Checked October 17, 2026

2. According to the CFPB, the APR is a broader measure of the cost of borrowing than the interest rate: it reflects the rate, points, mortgage broker fees and other charges you pay to get the loan, which is why it is usually higher than your rate; on the Loan Estimate, the rate is on page 1 and the APR on page 3; for an adjustable-rate mortgage the APR does not reflect the maximum rate; take care when comparing the APR of a fixed-rate loan with that of an adjustable-rate loan; and do not look at the APR alone.

   Sources 1 · What is the difference between a mortgage interest rate and an APR?: 'is a broader measure of the cost of borrowing money than the interest rate'; 'The APR reflects the interest rate, any points, mortgage broker fees, and other charges that you pay to get the loan'; 'your APR is usually higher than your interest rate'; 'you can find the interest rate on page 1 under'; 'and the APR on page 3 under'; 'the APR does not reflect the maximum interest rate of the loan'; 'Be careful when comparing the APRs of fixed-rate loans with the APRs of adjustable-rate loans'; 'Don't look at the APR alone' · Checked October 17, 2026

3. According to the CFPB, each monthly payment is split between principal and interest; the interest part does not reduce your balance or build equity; early in the term you owe more interest because the balance is high, so most of the payment goes to interest; over time more of the payment goes to principal; and on a typical fixed-rate loan the combined principal and interest payment does not change over the life of the loan.

   Sources 2 · How does paying down a mortgage work? (last reviewed May 28, 2024): 'part of your monthly payment goes toward paying off the principal and part pays interest on the loan'; 'The part of the payment that goes to interest doesn't reduce your balance or build your equity'; 'In the beginning of your mortgage term, you owe more interest, because your loan balance is still high'; 'over time, more of your monthly payment goes to paying down the principal'; 'the combined principal and interest payment does not change over the life of your loan' · Checked October 17, 2026

4. According to the CFPB, your rate depends on your credit score, down payment, loan term and loan type: a higher credit score generally gets you lower rates; a higher down payment typically lowers your rate; a shorter term generally brings a lower rate because there is less risk to the lender; and if you qualify, VA, USDA or FHA loans can offer lower rates; the rate is important but not the only cost of a mortgage, and Freddie Mac's averages give you an idea of the rates you might be offered.

   Sources 3 · Explore interest rates (page last modified Feb. 17, 2026): 'when you change your credit score, down payment, loan term, and loan type'; 'Applying with a higher credit score means you generally are offered more affordable loans (that is, lower interest rates)'; 'Making a higher down payment typically lowers your interest rate'; 'Choosing a shorter loan term generally means you are offered a lower interest rate, because there is less risk to the lender'; 'If your personal situation qualifies, loans from VA, USDA, or FHA can offer lower interest rates'; 'Interest rate is important, but it's not the only cost of a mortgage'; 'You can get an idea of the interest rates you might expect to be offered' · Checked October 17, 2026

5. According to the CFPB, your credit score and credit report determine whether you can get a mortgage and the rate you will pay; higher scores make you eligible for lower rates; most mortgage lenders use FICO scores, look at all three credit reporting companies and use the middle score to decide your rate; errors on your report can lower your score and raise your rate, so check and correct it well before you apply; and avoid applying for a lot of new credit in a short time before a mortgage.

   Sources 4 · Does my credit score affect my ability to get a mortgage loan or the mortgage rate I pay? (last reviewed Dec 31, 2024): 'Your credit score and the information on your credit report determine whether you'll be able to get a mortgage, and the rate you'll pay'; 'Higher scores reflect a better credit history and make you eligible for lower interest rates'; 'most mortgage lenders use FICO scores'; 'use the middle score for deciding what rate to offer you'; 'which could mean a higher interest rate and less money in your pocket'; 'correct any errors well before you apply for a loan'; 'Don't apply for a lot of new credit in a short time' · Checked October 17, 2026

6. According to Freddie Mac, its PMMS survey publishes averages for 30-year and 15-year fixed-rate mortgages; the results come from the rates on thousands of loan applications that lenders across the country submit to it; they are published every Thursday; the national average uses conventional, single-family loans within conforming limits; and its borrower profile is good or excellent credit, 20% down and home purchases of owner-occupied one-unit homes.

   Sources 5 · Primary Mortgage Market Survey (PMMS): '30-year Fixed-Rate Mortgage'; '15-year Fixed-Rate Mortgage'; 'mortgage rates collected from thousands of loan applications submitted to Freddie Mac from lenders across the country'; 'PMMS is published each Thursday at noon ET'; 'The criteria include weekly conventional, single-family originations with conforming loan limits as set by FHFA'; 'good/excellent credit, 20% loans, home purchase loans on owner occupied 1-unit single-family properties' · Checked October 17, 2026

7. According to the Federal Reserve, changes in the federal funds rate are rapidly reflected in the rates on floating-rate loans, including floating-rate mortgages; rates on longer-term loans depend on expectations of how monetary policy and the economy will evolve over the life of the loan, not just the current federal funds rate; and changes in mortgage rates affect the demand for housing and home prices.

   Sources 6 · Monetary Policy: What Are Its Goals? How Does It Work?, 'How changes in the federal funds rate affect the broader economy': 'changes in the federal funds rate are rapidly reflected in the rates applied to floating-rate loans, including floating-rate mortgages'; 'The rates charged on longer-term loans are related to expectations of how monetary policy and the broader economy will evolve over the duration of the loans, not just to the current level of the federal funds rate'; 'Changes in mortgage rates affect the demand for housing and thus influence house prices' · Checked October 17, 2026

8. According to the CFPB, a shorter term (for example, 15 years) means higher monthly payments, typically lower rates and a lower total cost; a longer term (30 years) means lower payments, typically higher rates and a higher total cost; the rate on a shorter term is usually lower, by as much as a full percentage point; and rates vary among lenders, especially for shorter terms.

   Sources 7 · Understand the different kinds of loans available, '2. Loan term': 'Shorter loan terms generally save you money overall, but have higher monthly payments'; 'You are borrowing money and paying interest for a shorter amount of time'; 'The interest rate is usually lower-by as much as a full percentage point'; 'Rates vary among lenders, especially for shorter terms' · Checked October 17, 2026

9. According to the CFPB, with a fixed rate the rate and the principal and interest payment stay the same, although the total payment can change if property taxes, homeowners insurance or mortgage insurance go up or down; most borrowers choose fixed rates; most adjustable-rate mortgages (ARMs) have two periods, a fixed introductory period and a second period in which the rate goes up and down with the market, so the principal and interest payment could go up a lot, even double; some ARMs include rate caps; an ARM is less predictable but could be cheaper in the short term, for example if you plan to move within the initial fixed period, but if you stay longer you could pay a lot more.

   Sources 7 · Understand the different kinds of loans available, '3. Interest rate type': 'With a fixed-rate loan, your interest rate and monthly principal and interest payment stay the same'; 'if your property taxes, homeowner's insurance, or mortgage insurance goes up or down'; 'Most borrowers choose fixed-rate mortgages'; 'Most ARMs have two periods'; 'your rate goes up and down regularly based on market changes'; 'could go up a lot, even double'; 'Some ARMs include rate caps'; 'ARMs offer less predictability but could be cheaper in the short term'; 'you plan to move again within the initial fixed period of an ARM'; 'you could end up paying a lot more' · Checked October 17, 2026

10. According to the CFPB, your lender generally must document and verify your income, employment, assets, debts and credit history to decide whether you can repay; nonqualified mortgages ('non-QM') can be riskier or more expensive and are sometimes marketed to self-employed borrowers or borrowers without Social Security numbers.

    Sources 7 · Understand the different kinds of loans available, 'Loans are subject to government regulation': 'your lender must document and verify your income, employment, assets, debts, and credit history'; 'can be riskier or more expensive'; 'These loans are sometimes marketed towards self-employed borrowers or borrowers without Social Security numbers' · Checked October 17, 2026

11. According to the CFPB, with a fixed-rate mortgage the rate is set when you take out the loan and does not change, while with an adjustable-rate mortgage it may go up or down; many ARMs start at a lower rate than fixed-rate loans, which may last months, one year or a few years; after that it changes at regular intervals and your payment is likely to go up; part of the rate is tied to an index; when rates decline your payment sometimes goes down, but not with every ARM; and do not assume you will be able to sell or refinance before the rate changes, because your home's value could decline or your finances could change.

    Sources 8 · What is the difference between a fixed-rate and adjustable-rate mortgage (ARM) loan? (last reviewed Jan 14, 2025): 'the interest rate is set when you take out the loan and will not change'; 'the interest rate may go up or down'; 'Many ARMs will start at a lower interest rate than fixed-rate mortgages'; 'may stay the same for months, one year, or a few years'; 'the amount of your payment is likely to go up'; 'called an index'; 'but that is not true for all ARMs'; 'Don't assume you'll be able to sell your home or refinance your loan before the rate changes'; 'The value of your property could decline, or your financial condition could change' · Checked October 17, 2026

12. According to the CFPB, on an adjustable rate the index is a rate that moves with market conditions and the margin is a number set by the lender; when the initial rate ends, index plus margin becomes your new rate, subject to caps; the changes depend on the market, not your personal finances; the margin can vary a lot between lenders and you can negotiate it; and the margin is set in your loan agreement and does not change after closing.

    Sources 9 · For an adjustable-rate mortgage (ARM), what are the index and margin, and how do they work? (last reviewed Apr 3, 2024): 'the index is an interest rate that fluctuates periodically based on general market conditions'; 'The margin is a number set by your lender when you apply for your loan'; 'the index and margin are added together to become your new interest rate, subject to any rate caps'; 'are based on the market, not your personal financial situation'; 'it can vary a lot between different lenders'; 'You can also negotiate the margin'; 'The margin is set in your loan agreement and won't change after closing' · Checked October 17, 2026

13. According to the CFPB, ARMs typically have three caps: the initial adjustment cap (commonly two or five percent), the subsequent adjustment cap (most commonly one or two percent) and the lifetime cap (most commonly five percent, though some loans have a higher one); some loans have a different lifetime limit for decreases, known as a floor; two lenders may offer the same initial rate with different caps; and ask the lender to calculate the highest payment you may ever have, which is also on your Loan Estimate.

    Sources 10 · What are rate caps with an adjustable-rate mortgage (ARM), and how do they work? (last reviewed Jan 14, 2025): 'There are three kinds of caps'; 'It's common for this cap to be either two or five percent'; 'This cap is most commonly one or two percent'; 'This cap is most commonly five percent'; 'some loans may have a higher cap'; 'known as a floor'; 'Two different lenders may have the same initial interest rate but offer different rate caps'; 'Ask the lender to calculate the highest payment you may ever have to pay on the loan you are considering'; 'You can also find this information on your Loan Estimate' · Checked October 17, 2026

14. According to the CFPB, most ARMs have a fixed rate for an initial period, for example 3 or 5 years, and are typically recalculated once a year after that, though that structure is not required; on some loans the balance can grow even while you pay (negative amortization); some have a floor rate or a clause that only lets the rate go up, which makes them more expensive and risky; and most loans do not have prepayment penalties, but it is worth checking.

    Sources 11 · If I am considering an adjustable-rate mortgage (ARM), what should I look out for in the fine print? (last reviewed Feb 2, 2024): 'Most adjustable-rate mortgages have fixed interest rates for an initial period-for example, 3 or 5 years-and are typically re-calculated once per year after that'; 'But this structure is not required'; 'These types of loans are called negative amortization loans'; 'Even if the index goes lower, the rate on these loans does not adjust below the floor rate'; 'the interest rate can only ever adjust up, not down'; 'Most loans do not have prepayment penalties' · Checked October 17, 2026

15. The CFPB's Consumer Handbook on Adjustable-Rate Mortgages (CHARM) explains that on an ARM advertised as 5/1 or 5/6m the first number tells you how long the initial rate lasts and the second how often the rate changes after that (on a 5/6m, the rate stays the same for the first five years and may then adjust every six months); that the rate is index plus margin; that on an interest-only ARM the payment goes up when that period ends even if rates stay the same; and that a lender may give you the option to pay points but you never have to take it: to see whether it is a good deal, compare the cost of the points with what you save with the lower rate.

    Sources 12 · Consumer Handbook on Adjustable-Rate Mortgages (CHARM), pp. 4–5 and 18–19: 'The first number tells you the length of time'; 'your initial interest rate lasts'; 'The second number tells you how often the'; 'during the first five years in a 5/6m'; 'may adjust every six months'; 'Interest rate = index + margin'; 'When the interest-only period ends, your monthly payment increases'; 'Lenders may give you the option to pay points, but you never have to take that option'; 'compare your cost in points with the amount that you will save with a lower interest rate' · Checked October 17, 2026

16. Under Regulation Z, if the rate can rise after closing, the Loan Estimate includes the 'Adjustable Interest Rate (AIR) Table' with the index and margin, the initial rate, the minimum and maximum rate, when the rate can first change and how often after that, and the maximum change at the first and later adjustments.

    Sources 13 · 12 CFR §1026.37(j): 'If the interest rate may increase after consummation'; 'Adjustable Interest Rate (AIR) Table'; 'the index upon which the adjustments to the interest rate are based and the margin that is added to the index'; 'The minimum and maximum interest rates for the loan'; 'The month when the interest rate after consummation may first change'; 'The maximum possible change for the first adjustment of the interest rate' · Checked October 17, 2026

17. Under Regulation Z, if the APR may increase after closing on a loan secured by your principal dwelling with a term longer than one year, the lender must give you the 'Consumer Handbook on Adjustable Rate Mortgages' (or a suitable substitute) and a disclosure for each variable-rate program you are interested in, when it gives you the application form or before you pay a non-refundable fee, whichever comes first.

    Sources 14 · 12 CFR §1026.19(b): 'if the annual percentage rate may increase after consummation in a transaction secured by the consumer's principal dwelling with a term greater than one year'; 'at the time an application form is provided or before the consumer pays a non-refundable fee, whichever is earlier'; 'The booklet titled Consumer Handbook on Adjustable Rate Mortgages, or a suitable substitute'; 'A loan program disclosure for each variable-rate program in which the consumer expresses an interest' · Checked October 17, 2026

18. Under Regulation Z, before the first adjustment of an adjustable-rate mortgage you must receive a separate notice at least 210, but no more than 240, days before the first payment at the adjusted rate is due; and when an adjustment changes your payment, the notice must reach you at least 60, but no more than 120, days before the first payment at the new amount is due.

    Sources 15 · 12 CFR §1026.20(d) ('The disclosures shall be provided to consumers at least 210, but no more than 240, days before the first payment at the adjusted level is due'; 'shall be provided as a separate document') and (c)(2) ('shall be provided to consumers at least 60, but no more than 120, days before the first payment at the adjusted level is due') · Checked October 17, 2026

19. According to the CFPB, points let you pay more up front in exchange for a lower rate and can be a good choice if you plan to keep the loan a long time; one point equals one percent of the loan amount; by law, points on the Loan Estimate and Closing Disclosure must be connected to a discounted rate; how much the rate drops per point depends on the lender, the kind of loan and the market; lender credits work in reverse, a higher rate in exchange for money toward closing costs, and may be called 'negative points' on a worksheet; if you are unsure how long you will stay, you can ask for two options (with and without points or credits) and the total cost over several timeframes, or review them with a HUD-certified housing counselor; and when comparing, ask each lender for the same amount of points or credits.

    Sources 16 · How should I use lender credits and points (also called discount points)? (last reviewed Oct 19, 2023): 'Points can be a good choice if you plan to keep your loan for a long time'; 'One point equals one percent of the loan amount'; 'By law, points listed on your Loan Estimate and on your Closing Disclosure must be connected to a discounted interest rate'; 'It depends on the specific lender, the kind of loan, and market conditions'; 'Lender credits work the same way as points, in reverse'; 'negative points'; 'ask a loan officer to show you two different options (with and without points or credits)'; 'You can also review your options with a HUD-certified housing counselor'; 'ask for the same amount of points or credits from each lender' · Checked October 17, 2026

20. According to Fannie Mae's Selling Guide, temporary interest rate buydowns are allowed on fixed-rate loans and certain ARMs for principal residences or second homes if the rate reduction does not exceed 3% and the rate increase does not exceed 1% per year; the buydown period cannot exceed 3 years; there must be a written agreement between whoever provides the funds and the borrower; the borrower remains obligated to make the payments in the note if the buydown funds are not available; the lender must qualify the borrower at the note rate, without considering the bought-down rate; and if the funds come from an interested party to the sale, the interested-party contribution limits apply.

    Sources 17 · Selling Guide B2-1.4-04, Temporary Interest Rate Buydowns (08/07/2024): 'Temporary interest rate buydowns are allowed on fixed-rate mortgages and certain ARM plans for principal residences or second homes provided the rate reduction does not exceed 3%, and the rate increase will not exceed 1% per year'; 'a buydown period not greater than 3 years'; 'The buydown plan must be a written agreement between the party providing the buydown funds and the borrower'; 'the borrower is not relieved of the obligation to make the mortgage payments required by the terms of the mortgage note'; 'the lender must qualify the borrower based on the note rate without consideration of the bought-down rate'; 'Fannie Mae's interested-party contribution limits apply' · Checked October 17, 2026

21. According to the CFPB, with a rate lock your rate does not change between the offer and closing as long as you close within the time frame and nothing changes in your application; mortgage rates can change daily, sometimes hourly; locks are typically for 30, 45 or 60 days, sometimes longer; a lock may be expensive to extend and may lock you out of a lower rate if rates fall; some lenders lock when issuing the Loan Estimate and some do not; a locked rate can still change if your application changes, including the loan amount, credit score or verified income, for example if you change the kind of loan or your down payment or the appraisal comes in different; lock policies vary by lender; and the Loan Estimate does not say how much it would cost to extend the lock.

    Sources 18 · What's a lock-in or a rate lock on a mortgage? (last reviewed May 2, 2023): 'as long as you close within the specified time frame and there are no changes to your application'; 'Mortgage interest rates can change daily, sometimes hourly'; 'Rate locks are typically available for 30, 45, or 60 days, and sometimes longer'; 'It may be expensive to extend if your transaction needs more time'; 'a rate lock may lock you out of a lower interest rate if rates fall'; 'Some lenders may lock your rate as part of issuing a Loan Estimate, but some may not'; 'including your loan amount, credit score, or verified income'; 'You decided to change the kind of loan you are requesting or the amount of your down payment'; 'Rate lock policies vary by lender'; 'it will not provide you with information about how much it would cost to extend the rate lock' · Checked October 17, 2026

22. According to the CFPB, locking your rate protects you if rates go up between now and closing; some lenders lock at the Loan Estimate stage and others wait for you to express your intent to proceed; and if you do not close before the lock expires, even because of the lender's processing time, you might have to pay to extend it, so ask whether you can switch to a longer lock and at what cost.

    Sources 19 · Choose a loan offer (page last modified Dec. 12, 2024): 'Locking your interest rate protects you in case interest rates go up between now and closing'; 'others require you to express your intent to proceed before locking your rate'; 'you might have to pay a fee to extend your rate lock'; 'Can you change to a longer rate lock now? At what cost?' · Checked October 17, 2026

23. Under Regulation Z, if the rate was not locked when you received the Loan Estimate, the lender must give you a revised Loan Estimate with the new rate, points and credits no later than three business days after the rate is locked.

    Sources 14 · 12 CFR §1026.19(e)(3)(iv)(D): 'No later than three business days after the date the interest rate is locked, the creditor shall provide a revised version of the disclosures'; 'with the revised interest rate' · Checked October 17, 2026

24. Under Regulation Z, the Loan Estimate states whether the interest rate is locked and, if so, the date and time that period ends; and it states that the rate, points and lender credits may change unless the rate is locked.

    Sources 13 · 12 CFR §1026.37(a)(13): 'is locked for a specific period of time'; 'the date and time (including the applicable time zone) when that period ends'; 'the interest rate, any points, and any lender credits may change unless the interest rate has been locked' · Checked October 17, 2026

25. HUD-approved housing counselors give independent advice on buying, renting, defaults and credit, often at little or no cost.

    Sources 20 · Find a Housing Counselor: 'Housing counselors throughout the country can provide advice on buying a home, renting, defaults, forbearances, foreclosures, and credit issues'; 'they can offer independent advice, often at little or no cost to you' · Checked October 17, 2026