Current Mortgage Rates

Sunday, September 07, 2008



Knowing how much income you need to qualify for a mortgage loan is an important step in your journey toward your dream home. Most real estate agents want you to be pre-approved for a mortgage loan amount before you even get started looking at homes. This makes sense as you don't want to waste your time looking at homes that would not be in your price range. Your income must meet the following two conditions:

* Your gross (pre-taxes) monthly salary must be greater than 28% of the sum of the monthly mortgage and monthly tax payments.

* Your gross (pre-taxes) monthly salary must be greater than 35% of the sum of the monthly mortgage, monthly tax and other monthly debt payments.

Lenders generally say that housing expenses should not exceed 25 percent to 28 percent of the homeowner's gross monthly income. The housing expenses include monthly mortgage principal, interest payments, property taxes and homeowner's insurance. For Federal Housing Administration (FHA) loans, this figure is not to exceed 29 percent of the homebuyer's gross monthly income. If you have no idea of what your property taxes or homeowners insurance will be, the following median statistical meanings can be used. According to the American Housing Survey data the median annual taxes per $1,000 value averages $12. The median property insurance costs per month averages $30.



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Current Mortgage Rates*

Loan Type
National Average
30-yr. fixed6.38%
30-yr. fixed jumbo7.00%
15-yr. fixed5.88%
15-yr. fixed jumbo6.50%
7/1 ARM6.25%
5/1 ARM6.00%
3/1 ARM5.88%
1-yr. ARM6.00%
1-yr. LIBOR ARM5.50%
10/1 ARM7.88%
*Mortgage Rates Updated: 09/04/2008