10-Year Fixed Mortgage Rates

A 10-year mortgage can save you thousands of dollars in interest if you can afford the higher monthly payments

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Although 10-year mortgage rates are usually lower than longer-term mortgages, you should weigh the pros and cons before choosing one. (Shutterstock)

Almost 90% of homebuyers choose a 30-year mortgage when buying a home, according to Freddie Mac. Though 10-year mortgages are less popular, they may also be worth exploring. Compared with 30-year mortgage rates, 10-year mortgage rates are typically lower.

But 10-year mortgages also come with disadvantages, like higher monthly payments than longer-term loans. Here’s what you need to know about 10-year mortgage rates, the pros and cons of 10-year mortgages, and how to find a mortgage that best matches your unique needs and budget. 

If you’re thinking about a 10-year mortgage, Credible lets you easily compare prequalified mortgage rates in minutes.

Today’s 10-year mortgage rate trends

Here’s how mortgage rates have been trending over the past 12 months.

Historical mortgage rates

Here’s what the annual average mortgage interest rate has looked like for the past 39 years.

How Credible mortgage rates are calculated

Changing economic conditions, central bank policy decisions, investor sentiment, and other factors influence the movement of mortgage rates. Credible average mortgage rates and mortgage refinance rates are calculated based on information provided by partner lenders who pay compensation to Credible.

The rates assume a borrower has a 740 credit score and is borrowing a conventional loan for a single-family home that will be their primary residence. The rates also assume no (or very low) discount points and a down payment of 15%.

Credible mortgage rates will only give you an idea of current average rates. The rate you receive can vary based on a number of factors.

Credible makes it easy to compare mortgage rates, without affecting your credit score.

Pros of a 10-year mortgage

A 10-year mortgage comes with several benefits, including:

  • Lower interest rate — A 10-year mortgage usually has a lower rate than a loan with a longer term. If you get one, you could save a lot of money on interest.
  • Lower total repayment amount — The amount of money you pay over the life of the loan will likely be less than you’d pay with a longer-term loan. For example, if you took out a 15-year, $200,000 mortgage at 3% interest, you’d pay $248,609 over the life of the loan. By contrast, taking out a 10-year mortgage with the same term, rate, and loan amount would cost a total of $231,745 — a difference of $16,864.
  • Build equity faster — Since your loan term is shorter, more of your payments will go toward the principal. This allows you to build equity in your home faster.

Cons of a 10-year mortgage

But 10-year mortgages also have some drawbacks you’ll want to consider:

  • Higher monthly payments — Since your payments are only spread out over 10 years, your monthly mortgage payments will be higher than a longer-term mortgage.
  • Less flexibility in your budget — As a result of higher payments, you may have less cash available to put toward other important financial goals, like retirement.
  • Potentially smaller loan — With a higher monthly payment, you may have a tougher time meeting a lender’s minimum debt-to-income ratio requirement and borrowing the amount of money you desire to spend on a home.

Find the right mortgage for you

Take these steps to find the right mortgage lender and mortgage that best matches your unique financial needs and goals:

  1. Check your credit. Before you start mortgage shopping, pull your credit report to see where your score stands and to look for any potential errors. This will give you an idea of what mortgage products you might qualify for.
  2. Review your budget. Before you take out a mortgage, review your monthly expenses and income to see how much home you can afford. If you need help, consider using a mortgage calculator to estimate your mortgage costs.
  3. Research and compare lenders. To find the best mortgage lender, you have to shop around. You can visit multiple lender websites to review and compare key features, such as rates, terms, origination fees, and closing costs.
  4. Get pre-approved. Once you’ve chosen the best lender for your situation, submit a pre-approval application to get estimated rates and terms. This typically requires a soft credit check, which won’t affect your credit. Once you formally apply for a loan, the lender will perform a hard credit check, which can cause your credit score to drop temporarily.

How to get a good 10-year fixed rate

When you apply for a 10-year mortgage, lenders will consider these factors, among others, to determine what interest rate to offer you:

  • Down payment — The higher your down payment amount, the less risk the lender has to take on. This means that if you put more money down, your lender may offer you a lower interest rate.
  • Credit history — Lenders review your credit score and payment history to assess how likely you are to repay your loan. If you have good to excellent credit, this may help you secure a loan with a lower rate.
  • Debt-to-income (DTI) ratio — Your DTI ratio measures how much of your gross monthly income goes toward paying your monthly debt. Although requirements vary, lenders typically want to see a DTI ratio of 36% or below. If your DTI ratio is higher, a lender may charge you a higher interest rate on a mortgage.

What credit score do you need to get a good 10-year mortgage rate?

While the credit score you need to get a good 10-year mortgage rate varies by lender, here’s a breakdown of your FICO Score, which most lenders use when they look at your credit: 

  • 350 to 580 — Poor
  • 580 to 669 — Fair
  • 670 to 739 — Good
  • 740 to 799 — Very good
  • 800 to 850 — Exceptional

Most conventional mortgage lenders want to see a credit score of at least 620 to approve you for a home loan. Some types of mortgage loans, like VA loans and USDA loans, don’t have a minimum credit score requirement. While it’s possible to get a home loan with bad credit, you may not receive the best interest rates.

Is a 10-year fixed mortgage a good deal?

Whether a 10-year fixed mortgage is a good deal depends on your budget. If you can afford the higher monthly payments, this option could save you thousands of dollars in interest and help you pay off your home faster. But if choosing this option would stretch your budget too thin, it’s probably best to choose a longer-term mortgage loan.

If you’re ready to purchase a home, use Credible to compare mortgage rates from multiple lenders, all in one place.

Should you get a fixed-rate mortgage or a variable-rate mortgage?

A fixed-rate mortgage has an interest rate that remains fixed throughout the life of the loan. By contrast, a variable-rate mortgage has a rate that’s fixed for a certain period of time (and is often lower in the beginning) and then fluctuates based on the current market. This type of mortgage is also called an adjustable-rate mortgage, or ARM. 

If you prefer predictable monthly payments and plan on living in your house for a long time, a fixed-rate mortgage is likely the best option. But if you don’t plan on staying in the home long and want to lock in a lower rate initially, taking out a variable-rate mortgage could make sense.