Today's Mortgage Rates and Mortgage Payment Calculator

A mortgage is a type of loan used to purchase or finance property. Mortgages are secured with the property being financed, meaning the property is used as collateral in case a borrower stops making payments on the loan.

A downpayment is an upfront investment made by a borrower, and in most cases it is required. A common downpayment for purchasing a property is 20% of the total cost of the property, this is often done to keep the Loan to Value at or below 80%. Not all types of loans require a downpayment, however. The most well known case of this is for a Veterans Affairs (VA) Loan. VA Loans are loans for military members and veterans and do not require a downpayment, but they have their own restrictions.

A conforming loan is a mortgage that conforms to the limits set forth by the Federal Housing Finance Agency (FHFA). These loans have specific requirements relating to maximum amounts and loan to value ratios. An example of a non-conforming loan would be a "Jumbo" loan, where the total loan amount is above the FHFA limit. The majority of mortgages are conforming loans.

The Loan to Value (LTV) is the ratio of the amount borrowed compared to the properties value. Typically, borrowers and lenders both try to keep the borrowed amount at or below 80% of the properties value. Loans with a LTV greater than 80% generally require the borrower to pay mortgage insurance since the lender is exposed to higher risk.

The interest rate a borrower is offered is affected by their credit score. The lower the score, the higher the interest rate.

No, among other things, the term of the loan, the borrowers credit score and the Loan to Value (LTV) can all affect the interest rate. A borrower with a low credit score, a longer loan term (30 years vs 15), and a high LTV will pay a significantly higher rate than one with a high credit score, a shorter term, and a low LTV.

No one but the borrower can make that decision. Ultimately it depends on whether today's interest rates are lower than the interest rate of the borrowers current loan, and whether that difference will be enough to compensate for the new loans origination fee's during the life of the loan. Other factors can impact this decision as well, such as if the borrower is interested in a cash out refinance. That being said - with Mortgage Rates being among the lowest in history, chances are it is an excellent time to refinance for many homeowners.

Origination fees are fees that a lender imposes on a borrower as a "cost of doing business". Recently, origination fees have ranged between 0.5% and 1% of the total loan amount. These fees can sometimes be added onto the loan itself so that the borrower does not pay out of pocket, although the total expense is higher.

A cash out refinance is a type of mortgage in which the borrower takes out a loan on the equity of a property. This is made possible when a property is valued higher than the current loan against it. For example, if a properties value has increased for any reason, including improvements, the owner may borrow additional money against the property and receive that as "cash". Individual lenders have their own criteria for cash out refinancing, but most lenders will require a loan to value of less than or equal to 80%;