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Current Mortgage Rates in California

Mortgage rates in California are some of the highest in the country. We’ve analyzed mortgage rates, terms and what that means for you in the sunny state of California. Check out our comprehensive list of California lenders and their notable attributes before you make a major decision.

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Tip: compare 2-3 lenders for the best rate

Quick Look: Best Lenders in California

  1. Better.com: Quick Service
  2. loanDepot: Refinance Process
  3. Chase: Best for Fixed and Adjustable Rates
  4. Rocket Mortgage: Best Overall

What is a Mortgage Rate?

A mortgage rate is the interest rate charged on a mortgage loan, and it’s determined by the lender. Rates can be fixed, which means they remain the same for the entirety of the mortgage term, or are variable, which means they can fluctuate during the mortgage term.

What Factors Impact Your Mortgage Rate?

Several factors have an impact on how lenders calculate your mortgage:

  • Down payment: The down payment is the amount you can initially pay toward a mortgage. You can offer to make a generous down payment, which shows your lender that you are capable of saving money and lowering the total amount you owe to the lender.
  • Loan term: Today, most loan terms are 15 or 30 years in duration. A vast majority of homeowners choose the 30-year option, but the short-term loans are eligible for the lowest interest rates. Ultimately, they are your best bet at lowering your mortgage rates in California. The downside is that you’ll have to make larger monthly payments.
  • Interest rate type: Homeowners choose from 2 types of interest rates that ultimately have an impact on mortgage rates — adjustable and fixed rates.

What is a Mortgage Type?

There are quite a few mortgage types in the state of California, but we’ll focus on the 4 major ones:

  • Conventional: Conventional mortgage loans are a safe option for homeowners in California due to their consistent monthly payments. It’s possible to find 10-, 15-, 20-, 30- and 40-year terms in California.
  • FHA: The Federal Housing Administration backs these loans — they’re ideal for first-time homebuyers with a bad credit score. FHA loans cover multi-family homes, condominiums and cooperative housing projects.
  • USDA: Short for the United States Department of Agriculture, this loan is appropriate for rural homeownership with specialized and reduced down payment loans. 
  • VA: This loan is a guaranteed loan by the U.S. Department of Veterans Affairs and is specially created for the veterans of the Armed Forces and their spouses. You do not have to come up with a down payment for a VA loan.

What is a Mortgage Term?

A mortgage term is the length of time calculated in years, which sets the parameters of a mortgage loan under legal effect. When the date of the mortgage expires, the borrower must renew the remaining balance or pay it in full. The mortgage term is usually a 30-year term, 15-year term or 5/1 ARM term. The 30- and 15-year terms can be fixed or variable terms; the 5/1 ARM is a variable mortgage term.

  • 30-year fixed: A 30-year fixed mortgage loan is a fully amortized loan that is paid off after 30 years as long as the conditions of the loan have not changed.
  • 15-year fixed: A 15-year fixed mortgage offers a lower interest rate (compared to a 30-year loan) and allows you to build equity more quickly. 
  • 5/1 ARM: This adjustable loan usually shifts or adjusts once per year. This loan often comes with a fixed interest rate over the first 5 years, then every year the rate adjusts (for the next 25 years or more) until the loan is paid off. 

Current Mortgage Rates in California

After deciding the type of loan and the length of your term, it’s important to understand the factors that impact the current mortgage rates in California. Every month after you have agreed to take the loan, you must pay back a portion of the amount you owe, along with the interest that has accrued for that specific month. Here are the factors that impact this: 

  • Escrow and other fees: Factors such as taxes, insurance and escrow costs need to be budgeted as they can have a significant impact on your monthly mortgage payments. These are costs that are not fixed and can fluctuate and cause the lender to itemize the extra costs into your mortgage agreement. 
  • Pay extra each month: The quickest way to become the sole owner of your home is to make extra payments every month. You should pay off outstanding debts such as credit cards and student loans. Your savings account should be fully stocked before you pay an extra amount each month when your mortgage payments are due.
  • Interest as a tax deduction: Itemize deductions on your yearly tax returns, if applicable. The IRS allows you to deduct your mortgage interest payments on your home. However, this may vary for state returns.
  • Loan term analysis: California mortgage rates are based on 30-year fixed, 15-year fixed and 5/1 ARM rate terms. Most homeowners choose the 30-year fixed term but it’s most cost-effective to aim for the 15-year fixed mortgage.
Loan TypeCurrent Mortgage Rate
30-year fixed3.73%
15-year fixed3.33%
5/1 ARM (adjustable rate)3.90%

Calculate Interest in California

Lender interest rates in California evaluated yearly are referred to as the annual percentage rate. This rate is applied to most borrowing or lending transactions conducted in the world. Individuals and companies typically apply for loans so they can acquire and expand their portfolio of land, machinery and buildings. This money is paid back to the lender either in a lump sum by a decided date or in monthly or annual installments. An interest rate is charged depending on market conditions. 

Let’s say you take a $300,000 mortgage from a lender and the agreement states that an interest rate of 15% will be charged on the amount. You’d have to pay a total of $45,000 over the initial $300,000. The calculations are as follows:

$300,000 + (15% x $300,000) = $300,000 + $45,000 = $345,000

The calculations are based on a simple interest formula as follows:

Simple interest = Principal  x Interest rate x Time

CityAverage Home ValueLoan TermCurrent RateMonthly PaymentTotal Interest Paid
Los Angeles$692,80030-year fixed3.73%$3,200.61$459,418.69
San Francisco$1,351,50030-year fixed3.73%$6,243.68$896,224.54
San Diego$635,40030-year fixed3.73%$2,935.43$421,354.85
Sacramento$327,20030-year fixed3.73%$1,511.60$216,977.19

Lender Credit Score Minimums in California

A credit score is based off financial analysis and shows lenders how creditworthy you are. Your credit score is found in your credit report, which is sourced from the 3 credit bureaus — Experian, Equifax and TransUnion. 

When lenders consider applications for a mortgage loan, they view credit reports to evaluate any potential risks they may incur. Lenders want to avoid a case of bad debt and could reject your application immediately. Let’s say your credit score is borderline. It could impact your interest rate and credit limit you receive. 

Credit scores are made up of reports from mobile phone companies, landlords, insurance companies and government departments — they analyze how well you pay your bills to these entities. Digital finance companies that provide online loans also use alternate data sources to  evaluate the creditworthiness of potential borrowers to avoid potential risks. 

You need a minimum credit score of 620 to be eligible for a loan in California using Cornerstone, Chase, First Internet Bank and Flagstar. Some lenders such as Figure Home Equity accept a minimum score of 600.

Avoid debt to retain your existing good credit. If your credit score is not as high as the minimums, work to improve it before you apply for a mortgage loan.

LenderMinimum Credit Score Required
Cornerstone620
Chase620
Figure Home Equity600
First Internet Bank620
Flagstar620

4 Best Mortgage Lenders in California

We have compiled a list of the 4 best mortgage lenders in California.

1. Best for Quick Services: BETTER.com

We’ve chosen tech-savvy BETTER.com as one of the top 5 mortgage lenders in California. This organization claims to offer a 3-minute application process for pre-approval. It requires as little human involvement as possible and offers loan officers no commissions.

Only a 10% down payment is required and applicants get a response within 24 hours.

2. Best for Refinance: loanDepot

We’ve chosen loanDepot because of its online convenience.

This lender is backed by several affiliate locations globally and offers a lifetime guarantee on future refinances, boasts no lender fees and reimburses appraisal costs.

3. Best for Fixed and Adjustable Rates: Chase

Chase has locations in more than 22 states and allows you to apply via web, mobile and more.

Chase offers fixed and adjustable refinance loan options, completes all refinance transactions in under 2 months and offers custom rate quotes.

4. Best Overall: Rocket Mortgage

Rocket Mortgage is a leader among online lenders. We’re impressed with its mobile app and offers an easy-to-use digital loan experience with various mortgage options

Get the Best Mortgage in the Golden State

Buying or refinancing a home can be overwhelming. Know your options — evaluate products and services that fit your needs. Keep in mind that mortgage rates are certainly important but aren’t the only factors you’ll want to roll into your final decision. You might want to consider closing costs, customer service, mortgage types and more. 

Looking to Refinance?
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Frequently Asked Questions

1) Q: How do I get pre-approved?

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1) Q: How do I get pre-approved?
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First, you need to fill out an application and submit it to the lender of your choice. For the application you need 2 previous years of tax returns including your W-2’s, your pay stub for past month, 2 months worth of bank statements and the lender will run your credit report. Once the application is submitted and processed it takes anywhere from 2-7 days to be approved or denied. Check out our top lenders and lock in your rate today!

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2) Q: How much interest will I pay?

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2) Q: How much interest will I pay?
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Interest that you will pay is based on the interest rate that you received at the time of loan origination, how much you borrowed and the term of the loan. If you borrow $208,800 at 3.62% then over the course of a 30-year loan you will pay $133,793.14 in interest, assuming you make the monthly payment of $951.65. For a purchase mortgage rate get a quote here. If you are looking to refinance you can get started quickly here.

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3) Q: How much should I save for a down payment?

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3) Q: How much should I save for a down payment?
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Most lenders will recommend that you save at least 20% of the cost of the home for a down payment. It is wise to save at least 20% because the more you put down, the lower your monthly payment will be and ultimately you will save on interest costs as well. In the event that you are unable to save 20% there are several home buyer programs and assistance, especially for first-time buyers. Check out the lenders that specialize in making the home buying experience a breeze.

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