California Mortgage Rates

Are you looking for a home loan in California but are worried about high interest rates on mortgage loans? Don’t be. The COVID-19 pandemic we’ve been dealing with for the past year hasn’t been great overall for the economy or job market, but it has been awesome for mortgage loan interest rates.

As a result of the pandemic, home loan interest rates are now at some of the lowest points we’ve ever seen. That’s not just the case for a handful of states, either. It’s the trend we’ve seen nationwide — California included. As of mid-December, the average 30-year fixed-rate home loan in California was at 2.88% — which was slightly lower than the national average of 2.99% for 30-year fixed-rate loans.

Given the bottom-barrel interest rates, there has never been a better time to take advantage of the best mortgage rates for California. It’s not just purchase loan rates that are low, either. The refinance rates are at extremely low points, too — making this a great time to refinance or buy a home in this state. Here’s what you need to know.

[Read: This is the Best Time in 50 Years to Refinance a Mortgage]

Mortgage Rates in California

The mortgage interest rate table below is updated daily to reflect the most current mortgage rates available in the market. According to Bankrate’s latest survey of the nation’s largest mortgage lenders, these are the current average rates for a 30-year fixed, 15-year fixed, FHA and VA mortgage rates.

Product Rate Rate Last Week
30-Year Fixed Rate2.950%2.980%
20-Year Fixed Rate2.770%2.820%
15-Year Fixed Rate2.240%2.320%
10-Year Fixed Rate2.230%2.270%
30-Year FHA Rate2.530%2.560%
30-Year VA Rate2.520%2.530%

Rates data based on Sacramento, California as of 7/22/2021

California mortgage rates overview

Overall, real estate in California is not cheap. Not only does California have one of the highest median sales prices out of all 50 states, but the state also has the highest average mortgage debt, too. Higher-priced homes will come with larger loan amounts, since most people can’t save enough for a down payment to make a huge dent in the principal.

You can choose from several different types of mortgage loans in California, including your standard conventional, FHA and VA loans, all of which are available nationwide.

Conventional loans are a good choice if you need a mortgage for a primary residence, vacation or investment home. You’ll typically need to have a credit score of at least 620, a documented history of stable employment, and a down payment requirement of at least 10% to 20% to qualify. Many lenders also require an appraisal to be done on your home. The actual requirements will depend on the lender.

FHA loans are another option if you’re buying a home as a primary residence. These loans are backed by a department of the federal government, and are a good option if you’re not able to meet the down payment or credit score requirements of a conventional loan. FHA loans only require a down payment of 3.5% and a credit score of 580 to qualify. If you can manage a 10% down payment, the credit score requirement drops to 500 — but again, it will depend on your lender.

If you are an eligible member of the military looking for a primary residence, you could apply for a VA loan if you qualify. VA loans do not require any down payment. Credit score requirements are also more flexible, although the exact requirements can vary from lender to lender. You won’t have to pay for extra mortgage insurance either, but you can only get a VA loan if you meet the strict qualifications.

These options are all available in California, so it’s a good idea to narrow down the type of loan you want before your search. If you’re looking for the best mortgage rates, you’ll want to understand the ins and outs of each loan so that you understand which is best for your situation.

Mortgage Rates Trends

In this graph: On , the APR was for the 30-year fixed rate, for the 15-year fixed rate, and for the 5/1 adjustable-rate mortgage rate. These rates are updated almost every day based on Bankrate’s national survey of mortgage lenders.
Toggle between the three rates on the graph and compare today’s rates to what they looked like in the past days.

[Read: What are the Different Types of Mortgages?]

First time home buyer programs in the state of California

If you’re buying a home for the first time, the California Housing Finance Agency (CalHFA) has a number of first time home buyer programs that can help make it easier for you. These programs offer financial assistance with down payments and closing costs. There are also mortgage programs with more flexible loan approval criteria, such as CalHFA FHA, CalPLUS FHA, CalHFA VA and others.

If you have not owned a home in the past three years, you are considered a first time home buyer under CalHFA. The CalHFA do not offer the loans, but private lenders do. If you are interested in their programs, you’ll need to find a lender that offers CalHFA loans.

[Read: 7 Crucial Steps to Buying a Home]

Most and least expensive places to live in California

Least expensive places to buy real estate in California

California is one of the more expensive states to buy real estate, but there can still be some great deals to be found.

Here are the 5 most affordable places to live in California, along with their median sales prices:

  1. Clearlake, CA: The average home sales price in Clearlake is just $176,192.
  2. Bakersfield, CA: When it comes to affordability, Bakersfield is right up there with a median home price of $242,800.
  3. Fresno, CA: At $247,600, the median price in Fresno puts this area on the affordable side for California.
  4. Eureka, CA: Eureka is another affordable area, with a median home sales price of just $303,638.
  5. Stockton, CA: Stockton may be more expensive than the other areas on this list, but with a median home sales price of just $320,319, it’s still more affordable than most other areas in the state.

Most expensive places to buy real estate in California

By contrast, if you’re fortunate enough to be able to afford a higher cost of living, here are the 5 most expensive cities in California, along with their median sales prices:

  1. Atherton, CA: The average home price in Atherton is a whopping $7,050,000 — well out of your average person’s price range.
  2. Santa Monica, CA: Home prices in Santa Monica are also sky-high, with an average of cost of $4,154,000.
  3. Beverly Hills, CA: Beverly Hills is notorious for being home to the rich and famous, and the price tags reflect that. A home in Bevery Hills will run you, on average, about $4,080,000.
  4. Palo Alto, CA: Palo Alto is another pricey area, with home prices averaging about $3,522,000.
  5. Los Altos, CA: If you’re looking for affordable, look somewhere other than Los Altos. This California city has an average home price of $3,450,000.

California mortgage rates compared to the national average

In general, mortgage rates in California fall in line with or just slightly higher than the national average. As of the week of December 7, the average rate for a 30-year fixed mortgage in California was 2.75%, higher than the national average of 2.74%. The following week saw a drop in those rates to below the national average, though — so as with any area, the rates can fluctuate with demand and other factors.

Rates have been trending downwards for 2020, largely due to the pandemic causing low interest rates across the board. This has trickled down to the mortgage rates, which is keeping housing more affordable.

For example, rates for California were hovering above 4.5% earlier this year, and have since dropped to 2.75% — a significant change since the start of the pandemic.

Already own a home and want to refinance?

As our economy recovers and unemployment rates begin to fall, there’s a good chance that rates will increase again. These rates could also increase with more demand, as we’ve seen in spikes during the pandemic. Experts expect rates to stay low through 2021, but that may change if we get the pandemic under control in the near future.

Don’t roll the dice and wait. If you are looking for the best refinance rates for your mortgage, there’s no better time than now, because rates are as low as they could possibly be. As of December 7, the average mortgage rate for 30-year fixed rate mortgages in California was 2.6%. That’s down from nearly 4.6% just two years ago.

[Read: How to Refinance Your Mortgage]

Mortgage rates in other states

Arizona
California
Colorado
Florida
Massachusetts
Michigan
New Jersey
New York
North Carolina
Texas

Andrew Wan

Contributing Finance Writer

Andrew has over a decade of experience in real estate lending, and enjoys sharing his knowledge by writing articles related to banking, personal finance, and real estate. He became a freelance writer shortly after earning his MBA, producing articles exclusively for Million Mile Secrets. When he’s not writing articles or working on assignments for his graduate degree in law, he likes to relax by hiking or playing tennis.

Reviewed by

  • Angelica Leicht
    Angelica Leicht
    Mortgage Editor

    Angelica Leicht is an editor at The Simple Dollar who specializes in mortgages, mortgage refinancing, home equity loans, and HELOCs. She is a former contributing editor to Interest.com and PersonalLoans.org.