10-year mortgage rates in 2024 — and tips to score a competitive APR
Updated 9:46 AM EDT, Thu August 29, 2024
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Current 10-year mortgage rates were on the downswing by late August 2024, bringing monthly payments down, too. And with the Federal Reserve poised to cut rates in the fall, mortgage rates will likely follow. That’s good news for mortgage borrowers across the board.
If you’re intent on a 10-year mortgage — with its interest savings and faster route to being mortgage-free — improve your odds of securing the best 10-year mortgage rates by strengthening your application and comparing multiple lenders (below).
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Current 10-year mortgage rates
According to Zillow data, the average interest rate on a 10-year fixed-rate mortgage was 5.22% as of Aug. 27, 2024. This rate was slightly lower than the average 15-year loan rate and considerably lower than the average rates for 20-year and 30-year loans.
The rates on 10-year mortgages have generally trended upward over the past two years, with some short-term dips. Mortgage rates started to stabilize in August, heading down slightly after staying stubbornly high.
Note that 10-year mortgages can be challenging to find. Many top mortgage lenders — including Citibank, JPMorgan Chase, Rocket Mortgage and Wells Fargo — don’t offer 10-year loans, even if they offer other less traditional loan terms.
“The reason why they don't offer them very often… is because of the payment per month, the debt-to-income ratio (requirements),” said Jason Staadt, who runs a mortgage firm in Colorado. “It really knocks a lot of people out of being able to afford those (10-year loans), especially with housing prices and how high they are.”
How mortgage rates for 10-year terms are trending
After lingering around the 7% mark for about two years, mortgage rates are expected to decline across the board in mid-to-late 2024. Ten-year mortgage rates will likely fall in tandem with 15- and 30-year rates later this year and into 2025.
With the Federal Reserve signaling it plans to cut the federal funds rate in September, borrowers might see rates decline in the fall, spurring new buying activity and mortgage refinancing.
This is good news for homebuyers who’ve been sidelined by the one-two punch of high rates and high home prices as of late. If rates stabilize and dip more, that could save you significantly on lifetime interest and help lower your monthly payments.
On the flip side, it might spur a surge in homebuyer demand, which could drive home prices up further.
5 tips for scoring competitive rates for a 10-year mortgage
- Shop around with lenders. Though your choices for lenders offering 10-year mortgages may be more limited, it still pays to compare rates and terms from at least three different lenders. Try smaller banks, credit unions and online lenders, and don’t sleep on mortgage brokers, who can do the shopping for you.
- Improve your credit scores. The higher your credit scores, the lower your interest rate will be. If your scores could use a bump, focus on paying down credit card accounts, making on-time payments and avoiding applying for new loans or credit cards.
- Lower your debt-to-income ratio. If a big chunk of your gross monthly income is going to recurring debt (think credit cards, personal loans or car loans), you need to either increase your income or pay down your debt. Aim to get your credit card balances below 30% of your available credit limit.
- Put more money down. If you come to the negotiating table with a larger down payment, you’ll lower your loan-to-value ratio (LTV) and, in turn, get more competitive rates. Creating a budget is a good first step to saving a down payment.
- Pay mortgage points. You can pay an upfront fee, known as mortgage points, to buy down your interest rate. While this means more money out of your pocket at closing, it can substantially lower your interest rate (one point equals 1% of your loan principal).
In general, mortgage rate pricing for lenders comes down to mitigating risk, said Staadt.
“The higher the risk, the higher the interest rate; the lower the risk, the better the interest rate,” he added. “A 10-year mortgage is a much lower risk for investors versus a 30-year mortgage because of the quicker capital reinvestment, the competitive market dynamics that go along with it, not having to try to forecast over 30 years and less exposure to the interest rate fluctuations.”
Lenders offering 10-year mortgage rates
Given their lower popularity, 10-year rates are harder to find than 15- and 30-year mortgage terms. In fact, SoFi is the only financial institution among CNN Underscored Money’s best mortgage lenders that offers 10-year fixed rates.
Other lenders offering 10-year terms include:
- AmeriSave Mortgage
- Bethpage Federal Credit Union
- loanDepot
- Navy Federal Credit Union
- PNC Bank
- U.S. Bank
AmeriSave Mortgage
APRs: Undisclosed
Minimum credit score: Undisclosed
AmeriSave offers 10-year fixed-rate loans, as well as 15-, 20-, 25- and 30-year terms. The online lender promises fast closings, mortgage rate buydowns and refinance credits. To see AmeriSave’s rates, you must apply online or speak with a mortgage banker by phone.
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Bethpage Federal Credit Union
APRs: 6.210% (conventional)*
Minimum credit score: Undisclosed
Bethpage Federal Credit Union offers 10-year fixed-rate mortgages up to $1,500,000 at competitive interest rates. The credit union provides personalized rates online and a seamless pre-qualification process. Bucking convention, Bethpage’s 10-year APR is higher than its 15-year and 20-year rates.
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loanDepot
APRs: Undisclosed
Minimum credit score: Undisclosed
LoanDepot offers 10-year fixed-rate mortgages with online application and approval processes. To see starting rates or get personalized quotes, you’ll need to apply online or speak to a lending officer via phone.
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Navy Federal Credit Union
APRs: 5.191% (conventional fixed), 5.590% (conventional ARM), 5.686% (VA)*
Minimum credit score: Undisclosed
For borrowers with ties to the US armed forces, Navy Federal Credit Union offers fixed- and adjustable-rate conventional and VA 10-year mortgages for purchase and refinance. Navy Federal home loans feature:
- A rate match guarantee if you find a lower APR for a comparable product elsewhere
- Waived private mortgage insurance (PMI) when putting less than 20% down on a conventional loan
- The ability to lower your interest rate after closing without having to refinance (for a $250 fee)
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PNC Bank
APRs: 5.466% (conventional)*
Minimum credit score: 620
PNC Bank offers 10-year fixed-rate loans up to the conventional loan limit ($766,550) — before you get into jumbo loan territory — with down payments as low as 3%. The bank doesn’t publish its loan qualifications online, but you can get a personalized rate quote and payment estimate within minutes.
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U.S. Bank
APRs: 5.726% (conventional purchase), 5.754% (conventional refinance)*
Minimum credit score: Undisclosed
U.S. Bank offers 10-year conventional fixed-rate mortgages with competitive rates. Notably, the bank’s 10-year APR is higher than its 15-year rate.
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*Rates as of Aug. 27, 2024
Best mortgage lenders of 2024
If you’re open to repayment terms longer than 10 years, consider these lenders:
Our picks at a glance
| Lender | Rating | Loan types available | Minimum credit score |
|---|---|---|---|
| Guaranteed Rate | 4.7 | 5 | 620 |
| Veterans United Home Loans | 5 | 4 | 600 |
| Alliant | 4.5 | 7 | Undisclosed |
| Pennymac | 4.3 | 6 | 620 or 580 (FHA, VA) |
| Bank of America | 4.2 | 7 | Undisclosed |
| Wells Fargo | 4.2 | 5 | Undisclosed |
| Chase | 4.1 | 6 | 620 |
| PNC Bank | 4 | 6 | 620 or 580 (VA) |
| SoFi | 3.9 | 5 | 620 or 600 (FHA, VA) |
How do 10-year mortgage rates work?
Most notably, 10-year mortgages typically have the lowest interest rates of any fixed-rate home loans. Their rates are usually lower than 15-year, 20-year and 30-year loans. Between the shorter repayment period and lower interest rate, you’re likely to save tens of thousands of dollars in interest by opting for the decade-long term.
However, that lower interest rate comes with a significant trade-off. When you select a 10-year term, you commit to paying off your mortgage three times faster than you would with a typical 30-year loan. As a result, even with the lower interest rates, your monthly mortgage payment will be considerably higher.
Example: To give you an idea of how a loan’s term and interest rate can affect the monthly payment on a $300,000 balance:
| Interest rate | Interest on first monthly payment | First monthly payment amount | |
|---|---|---|---|
| 10-year fixed | 5.200% | $1,473 | $3,640 |
| 15-year fixed | 5.300% | $1,502 | $2,742 |
| 20-year fixed | 5.700% | $1,615 | $2,377 |
| 30-year fixed | 6.000% | $1,700 | $2,038 |
As you can see, shorter loan terms have a higher monthly payment, but a smaller percentage goes toward interest.
It’s also worth noting that a 10-year loan doesn’t always beat out the 15-year loan interest rate with all lenders. The 10-year mortgage rate could be slightly lower or even slightly higher than its 15-year rate due to fees associated with each loan, said Kara Loftus, a vice president of mortgage lending at Mountain America Credit Union.
Expert’s take: “Historically, the 10-year fixed-rate mortgage has a strong benefit over other mortgage terms,” said Matt Ricci, a loan officer with Churchill Mortgage. “However, in the current market, there are variables at play that will make it less desirable, depending on the lending institution and availability in a consumer’s general market.”
Types of 10-year mortgage rates
There are two types of rates: fixed and adjustable.
- A fixed-rate loan has the same interest rate for the entire term. That means if you have a 10-year fixed-rate loan, your mortgage rate and principal-and-interest payment won’t change during the decade. While most borrowers appreciate this stability, fixed-rate loans generally have higher starting rates than adjustable-rate loans.
- An adjustable-rate mortgage (ARM) has an interest rate that can change over time, after an initial fixed-rate period. The benefit of an ARM is that you’ll enjoy a lower initial rate than you would on a fixed-rate loan. However, because the ARM rate can fluctuate, you’re more vulnerable to interest rate changes and could see your mortgage payment increase.
How do ARMs work?
A 10-year adjustable-rate mortgage is a home loan with a fixed rate for the first decade and a fluctuating rate for the remaining repayment term (usually an additional 20 years for a 30-year term). Rates typically start lower but can increase with the market.
The rate would “adjust” annually (or every “1” year for “10” years on a 10/1 ARM) or every six months (as with a 10/6 ARM) until the repayment term elapsed. With a 10/1 ARM, for example, your rate may change annually for years 11 to 30 of a 30-year term.
Expert’s take: “An adjustable-rate mortgage is a good program; it allows consumers to get into a home at a lower rate,” said Loftus. “It's a great option if you’re purchasing a home and know you’ll be in it for less than 10 years.”
Pros and cons of 10-year mortgages
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“The most significant advantage of a 10-year mortgage is the substantial interest savings over the life of the loan,” said Andreis Bergeron, a real estate investing executive. “In today's higher rate environment, this could mean locking in savings against future rate increases.”
Besides the lower interest rate, 10-year loans have some key advantages over longer-term loans. Because of the shorter loan term, you build equity in your home quicker and become mortgage-free faster. After a decade in repayment, you’d have more room in your budget.
However, the high monthly payments that come with 10-year loans can be limiting. You’ll have less room in your homebuying budget, plus less cash for other expenses and goals, including savings. You might also find that you’re less prepared to deal with financial emergencies.
Additionally, only select lenders offer 10-year loans. And because of the high monthly payments, it might be more difficult to qualify once you find a lender.
Should you borrow a 10-year mortgage?
“A 10-year mortgage often suits borrowers who are closer to retirement and wish to pay off their home before that milestone — or those who have a stable and substantial income and can handle larger monthly payments without financial strain,” said Bergeron. “It’s also appealing for those looking to build equity quickly or who are purchasing a second home that they plan to own outright in a shorter span.”
If you have a modest monthly budget or a limited down payment, a 10-year mortgage may be harder to swing. As a result, most borrowers opt for longer-term mortgages, with as many as 90% of homebuyers choosing a 30-year loan in recent years, according to Freddie Mac.
“A 10-year purchase is more designed for someone who is not a first-time homebuyer — who has either owned multiple homes and built equity or possibly sold a home recently and has a larger down payment,” Loftus said.
Notably, 10-year mortgages are more popular among refinancers, who may be shortening or matching the remaining term on their loan.
“In the past 12 months [April 2023 to April 2024], we closed less than 1% of our volume in 10-year term mortgages," said Loftus, sharing Mountain America Credit Union data. “For our refinances, our 10-year program made up 14% of our volume.”
Alternative mortgage programs, strategies to consider
A 10-year mortgage has some benefits, especially when it comes to long-term interest savings. However, this home loan isn’t right for everyone.
There are several different options to consider, and it’s important to determine what’s best for you.
Loan programs
The most common mortgage is a conventional loan, which is any loan that isn’t backed by a government program. But depending on your situation, a government-backed loan might be ideal. FHA (or Federal Housing Administration) loans, for example, are available to borrowers with lower credit scores, which can make homeownership more accessible.
Additionally, VA (Veterans Affairs) loans and USDA (US Department of Agriculture) loans are available with no down payment. While USDA loans only feature a 30-year term option, they’ll help you buy a home more quickly because you won’t have to wait to save up a large down payment.
Loan types
When applying for a mortgage, you can choose between a fixed-rate and an adjustable-rate loan. The loan type you choose impacts your mortgage rate, as well as your monthly payment.
Most ARMs have five-year, fixed-rate terms. The less common 10-year ARM combines the benefits of 10-year fixed-rate loans and longer-term loans. You may still get the lower starting interest rate, which is locked in for a full decade. But because you have a longer loan term, you’ll have lower mortgage payments and may be able to pay down your loan faster.
“However, if the consumer does not get the entire debt paid down in 10 years, they will be at risk of a variable rate for 20 years until they pay off the loan balance in full,” said Ricci.
Also, keep in mind that 10-year ARMs may not have the same low starting interest rates as five-year and seven-year ARMs.
The type of interest rate that’s best for you depends on a variety of factors, including how long you plan to stay in your home and the amount of flexibility in your monthly budget.
Loan repayment terms
The lever you can pull to quickly change your interest rate or monthly payment is the loan term. The table below shows the difference between a 10/1 ARM, a 10-year fixed-rate loan and a 30-year fixed-rate loan.
Here’s an example of a $300,000 home loan tagged with the sample rates we used earlier:
| 10/1 ARM* | 10-year fixed | 30-year fixed | |
|---|---|---|---|
| Interest rate | 7.125% | 7.000% | 7.500% |
| Monthly payment | $2,021 | $3,483 | $2,097 |
| Overall interest | $503,285 | $118,004 | $455,787 |
| Overall cost | $803,285 | $418,004 | $755,787 |
Remember: 15- and 20-year loans can be a good compromise between the 10- and 30-year mortgage. They have lower monthly payments than 10-year loans and lower interest rates than 30-year loans.
Extra payments on a longer term
A 10-year mortgage helps you to pay off your loan the fastest. However, it may also stretch your budget and lock you into a higher payment that could become unaffordable over time.
An alternative to getting a 10-year loan is to choose a longer loan term, such as 20 or 30 years — and then make extra payments. You could make an extra payment whenever it fits into your budget, add an additional amount onto your normal monthly mortgage payment or make biweekly payments.
While these extra payments won’t offer the same interest rate benefit of a 10-year loan, they’ll still help you repay your loan more quickly.
Refinancing to a shorter term down the road
Though a mortgage is a long-term commitment, it doesn’t always have to be. Many homeowners eventually choose to refinance, either to a lower interest rate, a lower monthly payment or both.
A key benefit of mortgage refinancing your loan is the ability to choose a new loan term. If you don’t feel comfortable committing to a 10-year mortgage when you buy a home, consider choosing a longer loan term initially and then refinancing to a shorter term later on.
Related >> The best mortgage lenders for refinancing
How to get a 10-year mortgage
The process of getting a 10-year mortgage isn’t all that different from getting any other home loan, but there may be more effort required on your end. Here’s how to get started:
- Get your finances in order. Before you apply for a loan, save up enough for a down payment, increase your credit scores and ensure your cash flow and emergency savings are primed for homeownership.
- Shop around for lenders. 10-year mortgages can be challenging to find. If you’re set on that loan term, the research process may be extensive. Also, consider a 15-year loan, which is more widely available and still has a competitive interest rate.
Related >> How to choose a mortgage lender
- Get prequalified. Mortgage pre-qualification allows you to see whether you’ll qualify for a mortgage and how much you’ll qualify for. Pre-qualification allows you to compare different lenders and signals to home sellers that you’re a serious bidder. It’s one step below mortgage preapproval.
- Complete your loan application. Once you’ve found a home and made an offer, it’s time to move forward with an official loan application. During the underwriting process, you’ll be asked to provide information about your income, assets, liabilities and other aspects of your personal finances. This process may be more in-depth for a 10-year loan since you’ll have a considerably larger monthly payment.
Additional reporting by Deborah Kearns and Alaya Linton
Frequently asked questions (FAQs)
This loan term is less commonly available, but you still may be able to get a 10-year FHA or VA loan. However, USDA loans only feature a 30-year term option.
Still, there’s nothing that prevents you from paying down your government-backed loan more aggressively to be mortgage-free in 10 years.
This loan term is best suited for borrowers with a stable income who can accommodate the high monthly payments in their budgets. This loan might be well suited for you if you’re otherwise financially stable, meaning you have a consistent income, no high-interest debt and have emergency and retirement savings.
In most cases, a shorter mortgage term equates to lower interest rates. However, the interest rate you’re offered will depend on various factors, including the loan type and your creditworthiness.
Borrowers may consider 10-year mortgages because of the long-term savings they provide. Not only do 10-year loans result in you being mortgage-free the fastest, but they also have the lowest interest rates and lowest overall interest cost.
10-year mortgage rates are usually lower than both 15-year and 30-year loan rates. Generally speaking, the shorter the term on a fixed-rate loan, the lower the interest rate.
Editorial Disclaimer: Opinions expressed here are the author's alone, not those of any bank, credit card issuer, airlines, hotel chain, or other commercial entity and have not been reviewed, approved or otherwise endorsed by any of such entities.
This content is for educational purposes only and is not intended and should not be understood to constitute financial, investment, insurance or legal advice. All individuals are encouraged to seek advice from a qualified financial professional before making any financial, insurance or investment decisions.
Note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed or may no longer be available.
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