A 1% rate difference on a $350,000 mortgage costs you $72,000 over 30 years. Here's how to find the best rate — and the tools to prove it.
The average 30-year fixed mortgage rate in March 2026 is 6.65%. On a $350,000 home with 20% down, that's $1,796/month in principal and interest alone. But the difference between 6.5% and 7.5% is $198/month — or $71,280 over the life of the loan. Shopping rates isn't optional; it's the most valuable hour you'll spend in the home-buying process.
Based on $280,000 loan (20% down on $350K home). Principal & interest only.
Not all mortgage calculators are created equal. Most online tools only calculate principal and interest — which dramatically underestimates your actual monthly cost. A good calculator should include all five components of your payment:
Our free mortgage calculator includes all five. Most competitors only handle the first one.
After two years of elevated rates, the market is finally showing signs of moderation. Here's where things stand as of March 2026:
| Loan Type | Average Rate | Monthly Payment* | Best For |
|---|---|---|---|
| 30-Year Fixed | 6.65% | $1,796 | Most homebuyers |
| 15-Year Fixed | 5.90% | $2,351 | Faster payoff, less interest |
| 5/1 ARM | 6.10% | $1,697 | Moving within 5 years |
| FHA 30-Year | 6.25% | $1,724 | Lower credit scores |
| VA 30-Year | 6.05% | $1,686 | Veterans & military |
*Based on $280,000 loan amount. Rates as of March 2026 via Freddie Mac PMMS.
Pro tip: Get quotes from at least 3 lenders. The Consumer Financial Protection Bureau found that borrowers who shopped around saved an average of $1,500 over the life of their loan — and those who got 5+ quotes saved even more.
Your mortgage rate isn't set in stone. Here are proven strategies to knock it down:
A 740+ score gets you the best rates. Every 20-point improvement can save 0.125-0.25% on your rate. Before applying, pay down credit cards below 30% utilization, dispute any errors on your report, and avoid opening new credit lines.
20% down eliminates PMI entirely ($100-300/month savings). Even going from 10% to 15% down can improve your rate by 0.125%. If you can stretch to 25%, some lenders offer additional rate discounts.
One "point" costs 1% of your loan amount and typically lowers your rate by 0.25%. On a $280,000 loan, one point costs $2,800 but saves $50/month — paying for itself in 4.7 years. Worth it if you're staying 5+ years.
Watch out for: "No closing cost" mortgages that roll fees into your rate, teaser rates on ARMs that reset dramatically after the intro period, and lenders who quote rates without including points. Always compare the APR, not just the interest rate.
15-year mortgages typically carry rates 0.5-0.75% lower than 30-year loans. The monthly payment is higher, but you'll save over $100,000 in interest on a $280K loan.
See exactly what you'll pay each month — including taxes, insurance, and PMI.
Open Mortgage Calculator →If you're waiting for rates to drop, consider this: even a 6-month delay can cost you more than you'd save from a rate decrease, especially if home prices continue rising at 3-5% annually.
Assumes 3.5% annual home price appreciation. $280K initial loan, 30-year fixed, 20% down.
We use the standard amortization formula: M = P[r(1+r)^n] / [(1+r)^n – 1], where P is the principal, r is the monthly interest rate, and n is the total number of payments. Property taxes and insurance are estimated based on national and state-level averages from the U.S. Census Bureau.
Interest rates shown reflect current market ranges from Freddie Mac's Primary Mortgage Market Survey. Actual rates depend on credit score, down payment, loan type, and lender.
Using the 28% rule, your maximum monthly housing cost on $100K is about $2,333. With a 6.65% rate, 20% down, and typical taxes/insurance, that translates to roughly a $380,000-$420,000 home depending on your location and existing debt. Use our mortgage calculator for your exact number.
A 30-year mortgage gives you lower payments and more flexibility. A 15-year saves you 50%+ in total interest but requires ~40% higher monthly payments. If the 15-year payment is comfortable (under 25% of gross income), it's the better financial choice. If it would strain your budget, take the 30-year and make extra payments when you can.
740+ gets you the best conventional rates. 700-739 adds about 0.125-0.25%. Below 680, you'll pay noticeably more. Below 620, you may need an FHA loan (which adds mandatory mortgage insurance). Check your score for free at annualcreditreport.com before shopping.
At minimum 3 lenders, ideally 5. Include a mix: your current bank, a credit union, an online lender, and a mortgage broker. All applications within a 14-45 day window count as a single credit inquiry, so shop aggressively.