Interest Rates Over Time: Where Are Rates Today Vs Years Prior?

June 11, 2020
Last updated:
May 17, 2022
In This Article

When it comes to buying a home, there’s a lot of budgeting involved. As a buyer, you want to do your best to pay the lowest price possible for your home so you don’t end up paying more than necessary.

One of the best ways to keep your mortgage affordable is to secure the lowest rate possible. The question is, what are mortgage interest rates doing today? Is now still a good time to buy a home based on today’s rates?

Mortgage Rates Make a Difference in a Home Purchase

The price you end up paying for your home isn’t the only number you need to take into consideration. While that will certainly be a hefty amount, the interest rate that you pay on that amount can make a huge difference on the overall amount you pay over the life of the loan.

Even a 1% difference up or down on a rate can mean the difference between tens of thousands of dollars on your mortgage. Let’s illustrate to help you understand how much a small difference in your rate can make a big difference on your mortgage payments:

Let’s say you take out a 30-year, fixed-rate mortgage for $400,000. The following shows the monthly mortgage payment and total interest paid on two different interest rates:


  • Mortgage payment: $1,682
  • Total interest: $205,667


  • $1,902
  • $284,746

As you can see, if you’re rate was 1% lower, you’d save over $200 per month in mortgage payments, and nearly $80,000 in interest overall.

That’s why it’s so important to shop around for the lowest rate when you’re looking to take out a mortgage. Right now, mortgage interest rates are quite a bot higher than they were last year.

Having said that, you have some control over the rate you get. With strong financials and an excellent credit score, you can reduce the rate your lender offers you. This can translate into major savings.

How Much Have Mortgage Rates Changed Over Time?

Let’s take a look at what the interest rates have been over time to help you see why now may be a great time to lock in a mortgage:

  • 1970s: 8.86%
  • 1980s: 12.7%
  • 1990s: 8.12%
  • 2000s: 6.29%
  • 2010s: 4.07%

Today: 5.11%

Interest rates are very low compared to most of the above-mentioned years. But they’re on the rise. If rates continue rising, there may be more incentive than ever to make a move in today’s market before rates continue to increase.

Can You Lock in Your Mortgage Rate?

When you apply for a mortgage, your lender will likely offer you a mortgage interest rate lock after your loan application has been approved and before it’s gone to underwriting.

Interest rates fluctuate over time, so if you believe you’re currently seeing lower rates that will likely increase shortly, you may want to ask your lender to lock in your rate. If interest rates increase, your rate will be protected with a rate lock.

However, if rates go down after you’ve locked in, you lose out on the lower rates, unless you have a “float down” option available to you. It’s always a gamble.

Keep in mind that locking in your mortgage rate may come with a fee, which can vary. For instance, a 0.20% rate lock fee on a $400,000 mortgage would cost $800. Make sure the rate lock fee is worth it considering the fluctuations in interest rates when you apply for a home loan.

If you’re ready to get into the real estate market to buy a home, get in touch with Sammamish Mortgage to start the process!

Today’s Mortgage Rates

Need a Loan to Buy a Home?

If you’re in need of a home loan, Sammamish Mortgage is here to help. We are a mortgage company serving borrowers across Washington, Idaho, Colorado, and Oregon. We have been providing mortgage programs with flexible qualification criteria since 1992. Please contact us if you have any questions or are ready to apply for a mortgage.

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