Current Mortgage Rates

Sunday, November 08, 2009



Most people know that each of their monthly mortgage payments includes two parts: a portion that is assigned to repay the principal of the loan (that is, the money you've borrowed) and a second portion that is assigned to repay the interest. But for most homeowners, there is also a third part of the mortgage payment: the portion that is paid into a special escrow account that the lender maintains on your behalf to pay for things like the homeowners hazard insurance, your property taxes and mortgage insurance, if applicable. (This is the element of the monthly payment that can fluctuate even in a fixed-rate mortgage).

Together, these elements are called PITI (Principal-Interest-Taxes-Insurance). Most of your payment will go toward loan principal and interest, also called P+I. However, your monthly payment is also likely to include amounts for property taxes and homeowner's insurance. Because of these extra payments, your monthly P+I payment is sometimes called your P+I+T+I payment. If you plan to make a down payment of less than 20% of the home purchase price, you will also have to add an additional amount for private mortgage insurance ( PMI). You can follow the instructions to get your monthly payment:

  1. Calculate the monthly interest/principal payment based on the amount of the mortgage, the term of the mortgage (how many years the loan is for) and the interest rate. A number of websites offer free mortgage calculators; simply plug in these components to get this number.
  2. Determine how much the annual property taxes are on the home, and divide this number by the number of mortgage payments: 12 if it is a monthly mortgage, 26 if it is biweekly.
  3. Determine how much your homeowner's insurance will cost annually and divide by the number of mortgage payments (as you did above).
  4. Figure in private mortgage insurance (PMI) if you are required to pay it.
  5. Add these items - the calculated monthly interest/principal payment, insurance, taxes and PMI - together to determine your actual mortgage payment.



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Current Mortgage Rates*

Loan Type
National Average
30-yr. fixed4.88%
30-yr. fixed jumbo5.62%
15-yr. fixed4.38%
15-yr. fixed jumbo5.25%
7/1 ARM4.25%
5/1 ARM4.12%
3/1 ARM4.12%
1-yr. ARM3.75%
1-yr. LIBOR ARM4.38%
10/1 ARM4.75%
*Mortgage Rates Updated: 11/07/2009