Current VA Mortgage Rates and Lenders
Review current VA mortgage rates for October 19, 2018. The table below enables you to shop VA mortgage rates and fees for leading lenders in your state. As presented in the table, VA rates are lower than conventional mortgage rates but the closing fees are higher because you are usually required to pay a one-time VA funding fee at closing. You are not required to pay ongoing mortgage insurance so the monthly payment for a VA loan remains relatively low. Update the inputs in the refine your search menu to compare VA lenders using your specific criteria. We recommend that you contact at least five lenders below to find the loan with the lowest VA mortgage rate and costs.
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Why Select an VA Mortgage
No Down Payment.
The VA home loan program enables eligible borrowers to buy a home with no down payment which means they can get a mortgage for 100% of the property purchase price. Most mortgage programs require borrowers to make a down payment of 3% - 20%. Active and retired military personnel, including individuals in the reserves and national guard are eligible for the VA home loan program.
Low Interest Rate.
VA mortgage rates are typically .250% - .500% lower than the current interest rate on a conventional loan or other no or low down payment mortgage programs. This is because military personnel are considered credit-worthy borrowers and because the government guarantees 25% of the loan amount, which protects the lender against default. To help pay for the guarantee, the VA loan program requires borrowers to pay a one-time, upfront VA funding fee. The funding fee ranges from 1.25% - 2.15% of the loan amount depending on your down payment, type of military service and if this your first time using a VA mortgage program. Lower VA mortgage rates are one of the main benefits of the program.
No Ongoing Mortgage Insurance.
Unlike the FHA program and most other low or no down payment mortgage programs, the VA program does not require borrowers to pay an ongoing mortgage insurance premium. Not requiring ongoing mortgage insurance reduces your total monthly housing expense and makes owning a home more affordable.
For Home Purchases and Refinancings.
Borrowers can use the VA home loan program to buy a home or to refinance their existing mortgage. The VA offers a special refinance program, also known as a VA Streamline or IRRRL Refinance, that requires less paperwork than a regular refinance, making the process more efficient for borrowers. The VA also offers the the VA Energy Efficient Mortgages (EEM) Program that enables borrowers to include up to $6,000 in energy efficiency home improvements in their VA loan amount.
Mortgage Rates by Loan Product
Mortgage Rate ReportFriday, October 19, 2018
Mortgage rates moved higher this week as stock market volatility pushed bond yields higher. When the stock market drops, bond yields typically increase which applies upward pressure on mortgage rates, which we saw this week. Ironically, investor concerns over rising interests rates is one of the main factors that led to the equity market sell-off. Rates continue to increase following the Federal Reserve's decision to increase the Federal Funds rate 0.250% to a target range of 2.000% to 2.250% at its September meeting.
The rate hike was the Fed's third of the year as it implements a more aggressive monetary policy in response to a strong economy and labor market. The Fed also reinforced its plan to raise interest rates at least one more time before the end of 2018 and removed language that described its policy as "accommodative" from the meeting statement. The Fed's September meeting statement highlighted strong economic growth including a robust jobs market, household spending, business investment and inflation that is approaching targeted levels. These factors outweigh economic concerns previously identified by the Fed including the impact of a trade tariffs, sluggish wage growth and a slowdown in the housing market.
In implementing its interest rate strategy, it is clear that the Fed is more focused on a robust labor market and accelerating inflation than stalling home sales and prices. Supporting the Fed's outlook, the unemployment rate recently fell to its lowest level an almost five decades despite lower than expected job creation.
Although the housing market continues to be battered by a lack of affordable inventory, higher mortgage rates and a pullback in home construction -- all of which the Fed has acknowledged in recent comments -- the overall direction of the economy is offering no reason for the Fed to change its course on rates. The Fed's actions and consistently bullish signaling pushed mortgage rates to an eight-year high this week.
The interest rate for a 30 year fixed rate mortgage increased 0.125% to 4.750% and the rate for a 15 year fixed rate mortgage moved 0.125% higher to 4.250%. The interest rate on a 5/1 adjustable rate mortgage (ARM) also jumped 0.125% to 4.250%. Jumbo mortgage rates inched up 0.125% to 4.750%, inline with conforming loans. After climbing over much of the past month non-owner occupied mortgage rates reached the key 5.000% level. Providing some relief for borrowers, FHA mortgage rates and VA mortgage rates both remained steady at 4.250%, with both programs appealing to borrowers focused on low or no down payment programs, especially first-time home buyers.
The Fed had clearly communicated its plan to raise rates at its September meeting so few were surprised by the decision as well as the subsequent uptick in mortgage rates. Most signs -- including perhaps most important, the Fed's actions and words -- point to higher rates in the future, although borrowers should expect fluctuations in the near term. While interest rates are impossible to predict, prospective borrowers looking to buy a home or refinance should take advantage of any market pullbacks and may be able to lock in a lower rate by acting sooner rather than later. As lenders react differently to dynamic market conditions, we have also seen much wider variation in mortgage rate pricing, which means borrowers benefit more by shopping multiple lenders.
Because rates change constantly, we continue to actively monitor the mortgage market for new developments. Borrowers should check the FREEandCLEAR rate tables regularly to review personalized, updated mortgage rates for lenders in their area. Our rate tables are free to use and require no personal information.
Why Borrowers Compare VA Mortgage Rates on FREEandCLEAR
Comparing VA mortgage rates can save you thousands. Use our rate tables to find the lender offering the lowest rates and fees
Our rate tables put you in control. You can compare lenders anonymously plus you never need to provide your social security number
Review VA mortgage rates from leading lenders. Our lenders offer highly competitive terms to win your mortgage business
More FREEandCLEAR Mortgage Resources
Determine what size VA mortgage you qualify for and the amount of the required up-front VA funding fee
Review our in-depth overview of of the VA home loan program including borrower qualification guidelines and loan limits
Review our detailed comparison of low and no down payment mortgage programs including key program attributes and eligibility requirements
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