Find the right mortgage rate

The minimum depends on the loan type. Conventional loans start at 3% down (first-time buyers) or 5% down (repeat buyers). FHA loans need 3.5% down with a 580+ credit score. VA and USDA loans need 0% down for eligible borrowers. Put down less than 20% on a conventional loan and you owe private mortgage insurance (PMI), which adds 0.5-1.5% of the loan amount to your annual cost. Hit 20% down and PMI disappears, and so does that piece of the monthly payment.

The rate is the base cost of borrowing, expressed annually. The APR (annual percentage rate) layers in lender fees like origination, points, and other closing costs, then spreads them across the loan term. APR is always higher than the rate and is the cleaner number to compare across lenders. If lender A offers 6.50% with no points and lender B offers 6.25% with 1 point, the APR comparison tells you which is actually cheaper for the time you plan to stay in the home.

Yes, in most cases. A rate lock holds your quoted rate for a fixed window, typically 30-60 days, while you close. Rates can move meaningfully in weeks. Once you have a signed purchase agreement and a credible closing date, locking removes the risk of paying more if rates climb before closing. Most lenders offer free locks. If you need longer than 60 days, expect to pay a lock extension fee or a slightly higher rate.

One discount point equals 1% of your loan amount and usually trims your rate by 0.25%. On a $350,000 loan, one point costs $3,500 and saves about $55/month on a 6.5% loan. The break-even is roughly 64 months (5.3 years). Buying points makes sense if you plan to stay past the break-even and have the cash. It does not make sense if you might refinance or sell within a few years.

From application to closing, the average mortgage runs 30-60 days. The exact timeline depends on the lender, loan type, and how fast you hand over documents. Online lenders like Better and Rocket Mortgage can move faster, sometimes closing in 3 weeks. Government-backed loans (FHA, VA) often take a bit longer because of extra requirements. The most common delay is slow paperwork from borrowers. Have your W-2s, bank statements, and tax returns ready before you apply.