Why interest rate shopping matters
Your interest rate has an outsized effect on both your monthly payment and the total cost of your loan. This calculator shows a side-by-side comparison across a range of rates near the one you enter, so you can see exactly what a lower — or higher — rate would mean for your budget.
A worked example
On a $320,000, 30-year loan, moving from 6.0% to 6.5% raises your principal & interest payment from about $1,919 to $2,023/month — roughly $104 more per month, or over $37,000 across the full loan term. Moving from 6.0% to 7.0% pushes the payment to around $2,129/month, nearly $210 higher, and adds close to $76,000 in total interest over 30 years. Rate differences that look small on paper compound into real money over a multi-decade loan.
What actually moves your rate
- Credit score: typically the single biggest factor lenders price on.
- Down payment / loan-to-value: more equity generally means a lower rate.
- Loan term: 15-year loans usually carry lower rates than 30-year loans.
- Loan type: conventional, FHA, VA, and jumbo loans price differently.
- Discount points: paying upfront cash can buy your rate down.
Locking in a rate
Mortgage rates can move daily based on broader financial markets. Once you're actively shopping for a home, ask lenders about rate locks, which guarantee your rate for a set period while your loan closes. Comparing Loan Estimates from at least three lenders is one of the most effective ways to make sure you're getting a competitive rate — studies of mortgage shopping behavior consistently find that borrowers who get multiple quotes save more than those who accept the first offer.
Curious about refinancing an existing loan to a new rate? Try the Mortgage Refinance Calculator.