Compare Current Second Home Mortgage Rates

Current Mortgage Rate Trends

The average 30-year fixed mortgage rate for a primary mortgage is 7.23%, according to Curinos data. The average 15-year fixed mortgage is 6.26%, which is an option that would help you save on interest over time if you can swing the higher payments. The 5-year/6-month adjustable-rate mortgage averages 6.66%, but these mortgages can be unpredictable. If you're weighing a fixed- or adjustable-rate option, the small gap between the two may not offer enough savings to make a variable rate worth the risk.

Second home mortgages generally follow the same rate trends as primary home loans, but you may face stricter eligibility requirements.

^*Source: Curinos LLC, June 6, 2025; assumes a 720 FICO^® Score, $350,000 mortgage
^**Source: FRED via Optimal Blue, June 6, 2025
Notes: Rates can vary by data source; monthly payment calculation uses APR and assumes a $350,000 mortgage and 20% down; APR calculation assumes 5% in fees

Mortgage Rate Trends for the Last 5 Years

Over the last five years, mortgage rates dropped to record lows, then climbed to their highest levels in decades largely due to the Federal Reserve's aggressive response to inflation and the pandemic's economic aftermath.

Rates hit a historic low in early 2021, when the average 30-year fixed mortgage dropped to 2.65% in January, according to Freddie Mac data. But in March 2022, the Fed began a series of 11 straight rate hikes, raising the federal funds rate from near zero to a target range of 5.25% to 5.50% by July 2023. Mortgage rates climbed as well, rising from about 4.17% in March 2022 to 7.62% by October 2023.

After the final hike in July 2023, the Fed held rates steady until September 2024 when it cut rates for the first time in four years. Mortgage rates didn't mirror the pause exactly but hovered in the mid-6% range from January 2024 through May 2025, with one clear exception: September 2024 saw average rates fall to 6.18%, likely a response to the Fed's rate cut.

30-Year Mortgage Rate Trends 2020 to 2025

Learn more: How Does the Fed Affect Mortgage Rates?

What Affects Second Home Mortgage Rates?

Mortgages on second homes are impacted by the same factors that impact mortgages on primary residences, though you'll probably face higher mortgage rates because of the added risk of financing a second property. Here are the key factors that affect second home mortgage rates.

• Federal Reserve policy: The Fed doesn't set mortgage rates, but its rate decisions strongly influence them. When the Fed raises its benchmark rate to fight inflation, mortgage rates often rise in response.
• Inflation and the economy: When the rate of inflation goes up, lenders typically increase their rates to preserve their returns. Strong economic growth also tends to push rates higher.
• Bond market trends: Mortgage rates tend to rise and fall in line with 10-year Treasury yields because both compete for investors' dollars.
• Housing market conditions: High demand for homes can lead lenders to raise rates to offset their risk. They might also raise rates to guard against high default rates. But when demand is low, lenders often lower rates to attract borrowers.
• Higher rates on second homes: Rates for second homes can be 0.25% to 0.50% higher than those for a primary residence. That's because lenders see second homes as riskier. If you're thinking of tapping into home equity from your primary home through a cash-out refinance to help with the purchase, keep in mind those rates can be steeper too.

Second Home Mortgage Requirements

You'll typically need to meet stricter mortgage requirements for a second home than you did for your primary mortgage. That's because you're taking on additional debt, and lenders often assume you're more likely to prioritize your primary mortgage if money gets tight. Here's how mortgage requirements may differ for a second home.

• Higher interest rates: Lenders compensate for the higher risk on a second home mortgage by increasing the rates on them roughly 0.50% higher than those for primary residences.
• Larger down payment: While you can finance a primary residence with as little as 3% down, you'll generally need to put at least 10% down on a second home, or up to 20% or more with a lower credit score.
• Credit score: Most lenders want at least a 640 credit score for second homes, but a score above 680 is more common. By contrast, primary mortgage lenders will often accept credit scores as low as 620, or even 500 with a government-backed loan program like FHA.
• Debt-to-income ratio (DTI): Your DTI measures the percentage of your available gross monthly income that must go toward your total monthly debt obligations. With primary mortgages, lenders generally want to see a DTI under 43%, though some mortgage programs allow for ratios up to 50%. With a second home mortgage, aim for a DTI below 45%, but the lower the better.
• Occupancy: To qualify for a second home mortgage you must live in the property at least part time. This differs from an investment property mortgage which doesn't require you to live in the property at all.
• Cash reserves: Conventional loans may not require you to hold mortgage reserves if you're buying your primary residence and have strong credit, low debt and a solid down payment. But with a mortgage on a second home, you may need two to four months of cash reserves, even if you have strong financials.

Pros and Cons of a Second Home Mortgage

A second home mortgage can help you purchase your dream getaway, but it also adds another monthly payment to your budget, among other considerations. As with any major financial decision, it's always wise to weigh the benefits and downsides to help guide your decision.

How to Get the Best Second Home Mortgage Rate

Second home mortgage rates are generally higher than those for primary homes, but the following steps may help you get the better rate.

Check Your Qualifications

You'll be more likely to qualify for favorable rates if you're well-qualified so before you apply, check the following:

• Credit score: You'll likely need a FICO^® Score of at least 640 to qualify, but ideally aim for a score in the good to exceptional range—670 to 850—to increase your odds of getting a lower rate.
• Down payment: Remember, the higher your down payment, the lower your loan amount, which could lead to a lower mortgage rate. A down payment over 20% could also help you avoid having to pay private mortgage insurance (PMI).
• DTI: As mentioned, your DTI should be below 45% to qualify, but a lower ratio may show lenders your budget can handle another mortgage payment.

Choose a Shorter Term

If you can swing the higher payments, you might consider getting a 15-year mortgage instead of the standard 30-year term. Lenders generally offer lower rates on shorter-term home loans because they're able to recoup their investment sooner. You'll likely pay less in interest over the life of the loan, but understand you may have less wiggle room in your budget.

Buy Down the Rate

You may be able to trim your mortgage rate by buying mortgage points upfront. These discount points are interest you prepay in advance to lower your rate. Though rates vary by lender, you can typically reduce your mortgage rate by 0.25% if you pay 1% of the loan upfront.

Obviously, this upfront charge can be substantial, so run the numbers beforehand to make sure it's worth it. For example, if you pay $4,000 in points to reduce the interest on a 30-year, $400,000 loan by 0.25%, you might lower your monthly payment by about $67. In that case, it would take roughly 60 months, or five years, to break even.

Compare Multiple Lenders

Since lenders calculate their rates differently, it's essential to compare rates, fees and features from several lenders to find the best fit for your situation.

It's widely recommended that you get preapproved with at least three lenders to give you a better idea of what you qualify for. You may even leverage one of your better offers to land a better rate with your preferred lender.

Tip: When comparing loan offers, don't just focus on the interest rate. Also consider the APR, closing costs and fees for each loan to get a more complete view of the total cost.

Second Home Mortgage vs. Investment Property Mortgage

The difference between a second home and an investment property comes down to how you use it. A second home is a property you live in part time, like a vacation house. An investment property is one you don't live in at all and plan to rent out full time.

The reason this difference matters is because lenders see more risk in properties you won't live in. Second homes usually get better loan terms than investment properties because you live in them part time. For example, rates may be just 0.25 to 0.50% higher for a second property than those for a primary home, and you might only need 10% down. Investment properties, on the other hand, often come with rates that are 0.50% to 0.75% higher and require 15% to 25% down. That's because lenders believe when money gets tight, borrowers are more likely to stop paying for a home they don't live in.

Learn more: How Investment Property Mortgage Rates Differ From Conventional Mortgage Rates

Monitoring Your Credit May Help to Secure a Lower Mortgage Rate

Second home mortgage rates tend to be higher than those for primary mortgages. Expect to face stricter eligibility requirements, since lenders recognize your second home loan adds to your existing mortgage debt.

If you're getting ready to finance a second home, understand you'll likely need a strong credit score to qualify. Improving your credit could help you secure a lower second home mortgage rate. Consider getting free credit monitoring from Experian to help you track your FICO^® Score and get real-time alerts when new accounts or inquiries appear on your reports. That way you can spot potential issues early and improve your chances of getting a more favorable rate.