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Compare mortgage rates in Nevada.
Key Points
• Mortgage rates in Nevada have tended to hover just above the U.S. national average.
• Mortgage rates are influenced by economic factors, including the federal funds rate, and by a borrower’s personal financial profile.
• Higher interest rates make homes less affordable, lower rates make them more affordable.
• Nevada offers various mortgage types: fixed-rate, adjustable-rate, FHA, VA, USDA, and jumbo loans.
• The cost of living in Nevada is slightly above the national average, which can contribute to home affordability.
Introduction to Mortgage Rates
Securing a mortgage is a crucial step in the homebuying process, and understanding mortgage rates is essential for making an informed decision. Mortgage interest rates are the fees charged by lenders for borrowing money to purchase a home. These rates are influenced by a complex mix of economic factors and the borrower’s financial status. Let’s take a closer look at how all that plays out in Nevada, where the average home value is $441,637 — meaning a lot of money is at stake in most mortgage decisions.
Where Do Mortgage Rates Come From?
Mortgage rates are primarily influenced by the Federal Reserve’s interest rate policies. The Federal Reserve sets the short-term interest rates that banks use, and while home loan rates aren’t directly tied to Fed rates, they tend to follow the same economic trends. When the Fed raises interest rates, mortgage rates typically rise as well, and when the Fed lowers interest rates, mortgage rates tend to decrease.
How Interest Rates Affect Home Affordability
Mortgage rates have a significant impact on home affordability. A seemingly small difference in interest rate can have a substantial effect on the monthly mortgage payment and the total amount of interest paid over the life of the loan. When both home prices and interest rates are relatively high, it’s a double-whammy — particularly for first-time homebuyers, who may have a more limited budget.
Should Homebuyers Wait for Interest Rates to Drop?
Many homebuyers wonder whether they should delay their home purchase in anticipation of lower interest rates. This dilemma might be especially relevant if you are buying your first home and don’t plan to have income from the sale of another residence to smooth your way.
While rates do fluctuate, waiting to make a purchase could allow home prices to rise, which could outweigh the effect of saving, say, a portion of a percentage point on interest. Moreover, waiting delays the homebuyer’s opportunity to build equity in their home.
Homeowners who are concerned about high interest rates can console themselves with the fact that it might be possible to refinance their mortgage in the future if rates decrease.
Nevada Mortgage Rate Trends
Understanding historical mortgage rate trends can provide valuable insights into where rates are headed and help homebuyers make informed decisions about their mortgage options. Below is a look at how rates have changed in Nevada over almost 20 years (the Federal Housing Finance Agency stopped tallying state rates in 2018). More often than not, Nevada’s average rate is slightly above the U.S. average.
| Year | Utah Rate | U.S. Rate |
|---|---|---|
| 2000 | 7.99 | 8.14 |
| 2001 | 6.98 | 7.03 |
| 2002 | 6.44 | 6.62 |
| 2003 | 5.74 | 5.83 |
| 2004 | 5.66 | 5.95 |
| 2005 | 5.82 | 6.00 |
| 2006 | 6.56 | 6.60 |
| 2007 | 6.51 | 6.44 |
| 2008 | 6.09 | 6.09 |
| 2009 | 5.19 | 5.06 |
| 2010 | 4.93 | 4.84 |
| 2011 | 4.75 | 4.66 |
| 2012 | 3.90 | 3.74 |
| 2013 | 3.97 | 3.92 |
| 2014 | 4.32 | 4.24 |
| 2015 | 4.00 | 3.91 |
| 2016 | 3.83 | 3.72 |
| 2017 | 4.15 | 4.03 |
| 2018 | 4.70 | 4.57 |
Historical U.S. Mortgage Rates
Homebuyers concerned about current mortgage rates in Nevada could also familiarize themselves with the average U.S. mortgage rate over several decades. However lofty mortgage rates may feel in the present, it is unlikely that the numbers are hitting the double digits seen in the 1980s.
Factors Affecting Mortgage Rates in Nevada
Numerous factors influence mortgage rates in Nevada and nationwide. Some of these factors are economic, while others are largely within the homebuyer’s control. Understanding the factors that influence mortgage rates can help homebuyers make smart decisions about their mortgage options.
Economic Factors
• The Fed’s rate: The Federal Reserve’s interest rate policies have a direct impact on mortgage rates, although the Fed does not directly control mortgage rates. When the Fed raises interest rates, mortgage rates tend to rise, and when the Fed lowers interest rates, mortgage rates typically decrease.
• Inflation: The general increase in prices affects mortgage rates, too. When inflation reduces the purchasing power of money, it becomes more expensive for lenders to lend money. As a result, they may increase interest rates.
• Unemployment: Here, the effect is indirect. When unemployment rises, the Fed typically lowers interest rates to try to motivate the labor market. That may lead lenders to lower their mortgage interest rate, too.
Consumer Factors
In addition to economic factors, several consumer factors also affect mortgage rates. Here is where you, as a borrower, have more control.
Here’s the best part. Consumer-specific factors also play a role in determining mortgage rates. These are the things that savvy individuals can change and improve.
• Credit score: A higher credit score indicates a lower risk of default for the borrower, making that homebuyer more attractive to lenders. As a result, lenders typically offer borrowers with higher credit scores lower mortgage interest rates.
• Down payment: A larger down payment reduces the amount of money the homebuyer needs to borrow, which lowers the risk for the lender. Less risk typically equals a better mortgage rate.
• Income and assets: Lenders consider the borrower’s income and assets when determining what mortgage interest rate to offer. A steady income and sufficient assets demonstrate the borrower’s ability to repay the loan, making them a lower risk for the lender.
• Type of mortgage loan: Adjustable-rate mortgages (ARMs) typically offer lower initial rates compared to fixed-rate mortgages, but the interest rate can adjust over time. Government-backed loans, such as VA loans, may also have lower rates. Additionally, shorter loan terms generally come with lower interest rates than longer loan terms.
Types of Mortgages Available in Nevada
Pretty much any type of mortgage you might need is on the table in the Silver State: fixed-rate mortgages, adjustable-rate mortgages (ARMs), Federal Housing Administration (FHA) loans, Veterans Affairs (VA) loans, and United States Department of Agriculture (USDA) loans. Conventional loans are not backed by the government and offer flexible terms. They can be fixed-rate or adjustable-rate.
Fixed Rate Mortgage
Fixed-rate mortgages maintain the same interest rate throughout the life of the loan, ensuring that the principal and interest payments remain constant. This type of mortgage is ideal for borrowers who prefer a consistent payment schedule and who are able to lock in a favorable interest rate.
Fixed-rate mortgages are available in various loan terms, typically ranging from 10 to 30 years. The choice of loan term depends on the borrower’s financial situation and preference for monthly payments.
Adjustable Rate Mortgage
Adjustable-rate mortgages (ARMs) initially offer a lower initial rate than fixed-rate loans. However, the interest rate can adjust periodically after an initial fixed-rate period. ARMs can be beneficial for borrowers who plan to sell their home before the fixed-rate period ends or who expect interest rates to decrease in the future (in which case the rate would adjust down).
Borrowers should carefully consider the potential for interest rate increases in the future and ensure they can afford higher monthly payments if rates adjust upward.
FHA Loans
Backed by the Federal Housing Administration, FHA loans offer more flexible credit and income requirements compared to conventional loans. This makes them a good option for those who qualify as a first-time homebuyer or people with less-than-perfect credit.
VA Loans
VA loans are available to eligible veterans, active-duty military members, some Reserve and National Guard members, and surviving spouses. These loans offer competitive interest rates and do not require a down payment. Prospective borrowers do need to get a Certificate of Eligbility from the VA before seeking the loan from a participating lender.
USDA Loans
USDA loans are designed for borrowers who fall within the agency’s income restrictions and who are looking to purchase a home in a rural area. These loans offer competitive interest rates and do not require a down payment.
Jumbo Loans
Conventional mortgage loans have a cap of $806,500 for a single-family home. Borrowers in Nevada seeking a loan amount that exceeds this amount for a single-family home will need to apply for a jumbo loan. These loans may have more stringent borrower requirements compared to conventional loans, because the lender is taking on increased risk.
Popular Places to Get a Mortgage in Nevada
Securing a mortgage often depends on choosing the right location, where home prices are affordable the overall cost of living is manageable. Popular locations for obtaining a mortgage in Nevada include its largest cities: Las Vegas, Henderson, North Las Vegas, Reno, and Enterprise.
Nevada ranks 19th for its cost of living in the U.S, with an average cost of living that is three points above the national average. But of course different locations in the state have different conditions. Here are some of the lows and highs:
Least Expensive Locations
Some of the least expensive locations to purchase a home in Nevada include:
• Ely: This former stagecoach station is a small town that boasts one of the lowest cost of living numbers in Nevada.
• Carson City: Larger than Ely in population, Carson city has a cost of living that’s three percent below the Nevada average.
• Winnemucca: A small city of less than 10,000 people with a rich history, Winnemucca has a cost of living that’s 10 percent below the state average.
Most Expensive Locations
Some of the most expensive locations to purchase a home in Nevada, based on overall cost of living, are Reno (which ranks fourth on state cost-of-living rankings), Las Vegas (number five), and Incline Village (on Lake Tahoe and near some sweet skiing, it’s Nevada’s highest cost-of-living location).
Recommended: Best Affordable Places in the U.S.
Tips for Securing a Competitive Mortgage Rate in Nevada
Obtaining a competitive mortgage rate can significantly impact the overall cost of homeownership: Even a slight difference in the interest rate can result in substantial savings over the long term. Therefore, homebuyers are advised to research and compare mortgage rates from multiple lenders to secure the best possible rate.
For instance, a difference of just 0.5% in the interest rate on a 30-year mortgage of $300,000 can amount to a difference of over $34,000 in total interest paid. This highlights the significance of securing a competitive mortgage rate.
Compare Interest Rates and Fees
You don’t have to settle for the first mortgage offer you receive — and you shouldn’t. Shop around and compare interest rates and fees from multiple lenders to ensure you are getting the best deal.
In addition to the interest rate, inquire about any upfront costs or closing fees associated with the loan. These fees can vary among lenders and can add to the overall cost of the mortgage.
How to Get Preapproved
Completing the mortgage preapproval process allows you to move quickly when you find the right property. It also demonstrates your seriousness as a buyer and provides a clear understanding of your borrowing power. If you’re concerned about rising interest rates, you can lock in your rate for a certain period, typically up to 90 days, by paying a fee to the lender. This can provide peace of mind and protect you from potential rate increases during the homebuying process.
Recommended: Average Monthly Expenses for One Person
Nevada Mortgage Resources
Nevada offers resources to assist homebuyers, particularly first-time buyers and those with limited financial resources.
First-Time Homebuyer Programs
Nevada offers several programs to help first-time homebuyers overcome financial barriers and achieve homeownership. The Home is Possible program from the Nevada Housing Division offers low- and moderate- income homebuyers a fixed interest rate 30-year loan with additional assistance available for down payment and closing costs.
The state also has a Mortgage Credit Certificate (MCC) program for both first-time homebuyers and qualified veterans. It provides a federal income tax credit of up to 30% of the interest paid on a mortgage loan each year.
Down Payment Assistance
Down payment assistance programs help would-be homeowners overcome the challenge of saving for a down payment. The Home at Last Rural Nevada Down Payment Assistance program is offered through the Nevada Rural Housing Authority and features a no-interest, no-payment second mortgage, forgivable in three years. It’s available to first-time and repeat buyers.
Tools & Calculators
Tools and calculators can help homebuyers estimate their mortgage payments, determine affordability, and make informed financial decisions.
Run the numbers on your home loan.
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Mortgage calculator
Punch in your home loan amount and a new interest rate, and we’ll estimate your payoff date.
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Down payment calculator
Enter a few details about your home loan and we’ll provide your monthly mortgage payment.
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Home affordability calculator
Provide us with a few details and see how much you can afford to spend on a home purchase.
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. Any payments shown depend on the accuracy of the information provided.
Refinancing Options in Nevada
Undertaking a mortgage refinance can be a strategic move for homeowners looking to lower their interest rate, reduce monthly payments, or access cash for various purposes. Nevada offers several refinancing options, including the FHA Streamline Refinance and the Interest-Rate Reduction Refinance Loan from the VA. Banks and other lenders also offer refinancing for conventional loans. If you are considering a refinance, it’s wise to calculate the break-even point, the date by which interest savings (from a new, lower rate) would exceed the closing costs on the new loan. If you don’t plan to stay in your home that long, it might be worth reconsidering the refi.
Closing Costs and Fees in Nevada
Buyers in Nevada can expect to pay 3% to 6% of the home’s purchase price in closing costs. These costs cover various expenses such as loan origination fees, appraisal fees, title insurance, and government recording fees, and some costs may vary depending on the property value and location.
The Takeaway
Nevada’s mortgage landscape offers plenty of options for homebuyers. If you stay informed about current mortgage rates, explore homebuyer assistance programs (particularly if this is your first time purchasing a home), and carefully consider refinancing options, you won’t have to rely on luck to enjoy successful homeownership in Nevada.
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.
FAQ
Will mortgage rates drop in Nevada?
Predicting future mortgage rate trends is difficult, as they are influenced by various economic factors. However, monitoring market conditions, Federal Reserve policies, and keeping historical trends in mind can provide insights into potential rate movements.
Will mortgage rates ever go back to normal?
The definition of “normal” mortgage rates can vary over time. Historically, mortgage rates have fluctuated, and what is considered normal may change based on economic conditions and market trends.
Will Nevada home prices ever drop?
Nevada home prices are influenced by supply and demand, economic conditions, and market dynamics. Predicting future price trends is complex and subject to various factors. Your best bet is to consult on the price question with a real estate agent who is familiar with the specific area where you might purchase a home.
Is it a good time to buy a house in Nevada?
Determining the right time to buy a house in Nevada depends on individual circumstances, financial readiness, and market conditions. Do you need a home there? Have you found one you like? Can you afford it? If you can answer yes to all three of these questions, then it’s probably time to buy.
How do I lock in a mortgage rate?
Locking in a mortgage rate involves securing a specific interest rate for a certain period, typically 30 to 90 days. This can be done by paying a fee to the lender. Locking in a rate can provide peace of mind and protect against potential interest rate increases during the homebuying process.
How do mortgage interest rates work?
Mortgage interest rates represent the cost of borrowing money from a lender to finance a home purchase. They tend to follow the same general direction set by the Federal Reserve’s interest rate policies. But an individual borrower’s credit score, down payment amount, income, assets, and debt levels will influence what rate they are offered.
SoFi Mortgages
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SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
*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.
†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.
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.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article. 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.External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
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More home loan resources.
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First-Time Homebuyer Guide
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First-Time Homebuyer Programs and Loans
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Mortgage Preapproval Process