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• Mortgage rates in Dallas are influenced by a variety of factors, including economic conditions and your credit profile.
• Fixed-rate mortgages provide a steady monthly payment, while adjustable-rate loans are less predictable.
• Mortgage rates vary between lenders; shop around for the best deal.
• First-time homebuyers can benefit from assistance programs.
• Small changes in interest rates can have a big impact on long-term costs.
Introduction to Dallas Mortgage Interest Rates
Choosing the home you want to purchase in Dallas, Texas is a big decision. Almost as important? Selecting the mortgage you’ll use to finance your purchase. This guide will help you understand how Dallas mortgage rates are set, and how you can get the best rate for your home purchase. We’ll cover the factors that affect your rate, and give you some tips for finding the best deal based on your personal circumstances. To understand why a lender is offering you a particular rate, it helps to first get a handle on how rates are determined.
First-time homebuyer programs usually consider anyone who hasn’t owned a home in the previous three years to be a “first-timer.” If you think you might qualify as a first-time homebuyer, you could enjoy special benefits such as lower down payment minimums, grants, and closing cost assistance.
Where Mortgage Rates Come From
Mortgage rates are a product of various factors, from the larger economic landscape to your personal financial picture. Keep an eye on the bond market, particularly the 10-year U.S. Treasury Note, as it often points to the direction rates might take. If the housing market is cooling off, you might just see a dip in mortgage rates in Texas. (At the moment, the Dallas market is somewhat competitive.) Inflation and unemployment rates can also influence the cost of borrowing.
But while these large economic trends point rates in a certain direction, the rate you are personally offered will be based on your credit score, debt-to-income (DTI) ratio, and down payment amount. A score of 620 or better will likely be needed for a conventional loan, though some government-backed loans allow lower credit scores for qualifying buyers. By staying informed and understanding these moving parts, you’re better equipped to snag the most favorable mortgage rates in Dallas.
See how your debt level may affect your mortgage
Use SoFi’s debt-to-income calculator to determine your personal DTI number.
See how your debt level may affect your mortgage
Use SoFi’s debt-to-income calculator to determine your personal DTI number..
How Interest Rates Affect Home Affordability
Mortgage rates are a big factor in how much home you can afford. The median sale price of a home in Dallas is $419,000, according to Redfin. So it’s not unusual to need a loan in the neighborhood of $400,000. The chart below shows how different interest rates and loan terms affect the amount of a borrower’s mortgage payment and the total interest paid over the life of a $400,000 loan.
Interest Rate
Loan Term
Monthly Payment
Total Interest
6.00%
30-year
$2,398
$463,353
6.00%
15-year
$3,375
$207,577
7.00%
30-year
$2,661
$558,036
7.00%
15-year
$3,595
$247,156
Dallas, Texas Mortgage Rate Trends
Historical U.S. Mortgage Rates
Taking a look at the history of U.S. mortgage rates can help put current rates into perspective. From the 1970s to the 2020s, we’ve seen rates soar to a staggering 18.63% in 1981 and then plummet to 2.77% in 2021. Rates have risen since then, but are still nowhere near the highs we have seen in the past.
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The chart below shows how Dallas mortgage rates have compared to the national average rate in the past. As you can see, there is no fixed pattern, but Dallas numbers have not deviated dramatically from the national norm. (The Federal Housing Finance agency stopped tracking city-level averages in 2018.)
Year
Dallas Rate
U.S. Rate
2000
7.90
8.14
2001
6.99
7.03
2002
6.62
6.62
2003
5.77
5.83
2004
5.94
5.95
2005
5.89
6.00
2006
6.60
6.60
2007
6.47
6.44
2008
6.16
6.09
2009
5.02
5.06
2010
4.78
4.84
2011
4.45
4.66
2012
3.60
3.74
2013
3.81
3.92
2014
4.06
4.24
2015
3.78
3.91
2016
3.65
3.72
2017
3.95
4.03
2018
4.56
4.57
Source: Federal House Finance Agency
Types of Mortgages Available in Dallas, Texas
In Dallas, the type of mortgage you choose will contribute to the interest rate you’re able to obtain, so it pays to become familiar with the more common types.
Fixed-Rate Mortgage
Fixed-rate mortgages are a popular choice for many homebuyers. They offer a consistent interest rate throughout the entire loan term, which means your monthly payments will remain stable and predictable. Fixed-rate mortgages are available in terms from 10 to 40 years; the shorter the term, the higher the monthly payment — but the less interest paid over the long haul.
Adjustable-Rate Mortgage (ARM)
If you’re in Dallas and considering an adjustable-rate mortgage (ARM), you’re likely attracted to the lower introductory rate it offers when compared to a fixed-rate loan. With ARMs, you’ll enjoy that fixed rate for an initial period, often 5 or 7 years, but then the interest rate will adjust based on market conditions.
If you’re planning to sell or do a mortgage refinance before the intro period ends, an ARM could be a smart move. Just remember, there’s always the potential for rate increases, which could mean higher monthly payments down the line. It’s a smart idea to run the numbers for higher interest rates just to see what your monthly payment might look like if, say, your interest rate were to rise by a fraction of a percentage point or even a full point.
FHA Loan
Backed by the Federal Housing Administration, FHA loans are known for their more forgiving eligibility criteria compared to conventional loans, which is why they are a popular choice for first-time homebuyers in Dallas, Texas. With a minimum down payment of just 3.5% for homebuyers with a credit score of 580 or more, FHA loans can be a good option for those with lower credit scores who might not otherwise qualify. With a larger down payment of 10%, those with an even lower credit score may qualify for a loan. Borrowers will need to pay an upfront and annual mortgage insurance premium for these loans, but this makes it possible to access what for many is a very attractive financing option.
VA Loan
VA loans are a great opportunity for those who are eligible, including active-duty military members, veterans, reservists, National Guard members, and surviving spouses. One of the biggest benefits of VA loans is that they typically do not require a down payment, which can be a huge help for those looking to buy a home in Dallas. VA loans also often have more competitive, lower interest rates, and they do not require mortgage insurance. If you’re interested in a VA loan, the first step is to request a certificate of eligibility.
Jumbo Loan
In most parts of the U.S., and throughout Texas, conventional mortgage loans are capped at $806,500 for a single-family home. If you need a mortgage that exceeds this limit, you’re in the market for a jumbo loan. These specialized loans often come with higher interest rates and may include stricter qualification criteria for approval. But they can still be a viable option for those looking to purchase more expensive homes in desirable locations such as Dallas, Texas. Jumbo loans may also require a larger down payment and a higher credit score from borrowers, but they offer the flexibility needed for high-value properties.
Compare current home interest rates by state and find a mortgage rate that suits your financial goals.
Select a state to view current rates:
What to Do if You’re Waiting for Interest Rates to Drop
Many homebuyers in Dallas may wonder if they should postpone their purchase and wait for interest rates to drop in the future. However, current analyses suggest that mortgage rates will likely remain relatively stable for the foreseeable future. The average rate is expected to end 2025 at approximately 6.30%, according to projections from Fannie Mae. Fortunately, refinancing your mortgage is always a viable option to explore if interest rates decline at a later date.
Cost of Living in Dallas
Dallas may be one of the more costly cities in Texas to live in, but compared to U.S. cities as a whole, it’s one that won’t break the bank. Home prices are on the higher side here, with the median sale price topping $400,000, but prices have dropped in the last year (in May 2024, the median sale price hit $500,000).
The chart below shows how the cost of living in Dallas stacks up against other Texas metropolitan areas on a scale where 100 equals the average cost of living in the U.S.
Texas City
Cost of Living
Abilene
90.6
Amarillo
83.3
Arlington
95.7
Austin
97.4
Beaumont
91.8
Conroe
90.0
Corpus Christi
89.2
Dallas
101.8
Denton
99.2
El Paso
88.1
Fort Worth
96.1
Harlingen
82.1
Houston
94.2
Longview
93.9
Lubbock
90.4
McAllen
85.1
Midland
96.4
Nacogdoches
89.6
Odessa
93.0
Plano
110.0
San Antonio
91.2
Temple
90.0
Tyler
93.9
Waco
91.7
Get Your Best Possible Rate in Dallas
To secure the best mortgage rates in Dallas, there are a few things you can do before you begin your home-shopping in earnest. Focus first on taking good care of your credit score. Check your credit report and look for any errors. Pay your bills on time. And to any extent possible, try to reduce your debts, especially if your DTI ratio exceeds 36%. Take a good look at your budget to see how large a down payment you feel comfortable making. Consider going through the mortgage preapproval process and looking into different types of mortgage loan, such as ARMs and government-backed loans, that may offer lower mortgage rates in the Dallas area.
Helpful Tools & Calculators
Using a mortgage calculator is a savvy step as you’re thinking about your budget. In fact, all three of the helpful calculators below could be useful to you on your journey to homeownership.
Using the free calculators is for informational purposes only, does not constitute an offer to receive a loan, and will not solicit a loan offer. Amo payments shown depend on the accuracy of the information provided.
How to Evaluate Loan Offers in Dallas
Once you’ve shopped around a bit and have loan offers from various lenders in hand, you’ll want to sit down and compare them, since even a fraction of a percentage point lower interest rate can save you substantial dollars over the life of a home loan.
Don’t just examine interest rates, though. Study each loan’s annual percentage rate, or APR, which is a more accurate picture of total cost because it includes fees. Once you’ve found an offer that fits, consider paying a small sum to the lender to lock in your rate for up to 90 days.
Government-sponsored homebuyer assistance, including down payment assistance programs , can help get those with limited resources into a home in Dallas. This is especially true for those who are buying your first home. (As noted above, you could qualify if you haven’t owned a primary residence in the last three years.) The Texas Department of Housing and Community Affairs (TDHCA) offers the My First Texas Home and My Choice Texas Home programs, which provide 30-year, low-interest mortgages and up to 5% in down payment assistance. By tapping into resources like these, homebuyers could significantly reduce the financial load of purchasing a home in Dallas.
Closing Costs in Dallas
If you’re buying a home in Dallas, you can expect to pay between 2% and 5% of your loan amount in closing costs. Closing costs can vary based on your home’s value and location. They typically include fees for services like the loan origination, appraisal, and title insurance.
The Takeaway
The mortgage market in Dallas is rich with opportunity for those who are ready to take the leap into homeownership. By keeping an eye on current mortgage rates in Dallas and investigating the various assistance programs available, you can make a smart decision that aligns with your financial goals and sets you up for long-term success. Whether you’re a first-time buyer or a seasoned homeowner, understanding the different types of mortgages and resources available to you can be a huge help as you shop around for the best rate.
Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.
Is it the right time to invest in a Dallas, Texas home?
Deciding whether to buy a house in Dallas depends on many factors, some of which are unique to your situation. It’s a somewhat competitive housing market that might be difficult for shoppers on a limited budget. Mortgage rates are higher than 2021 lows, but show no sign of heading southward in the near future. And Dallas does have programs like My First Texas Home and My Choice Texas Home that offer low-interest mortgages and down payment assistance, enhancing affordability. Now can be a good time to enter the Dallas market if you have a solid financial plan.
How do you lock in a mortgage rate?
Locking in a mortgage rate is fairly simple. Shop around and compare offers from various lenders — banks, credit unions, and online lenders included. Once you’ve found a rate that speaks to you, ask the lender to lock it in for a set period, typically up to 90 days. You’ll pay a small fee in most cases, but it will guard you against rate hikes during the closing process.
How do mortgage interest rates operate?
Mortgage interest rates are the cost of borrowing money to purchase a home, and are typically expressed as a percentage of the loan amount. These rates are influenced by both the borrower’s financial profile and the current economic climate. Rates can be fixed or variable. When you make a mortgage payment, a portion of the payment goes toward the principal that you owe and a portion of it is interest. To see how much of each month’s bill is one vs. the other, a borrower can review the amortization schedule for their loan.
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*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.
¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.
†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.
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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Checking Your Rates: To check the rates and terms you may qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.
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