How mortgage rates work

Ten questions on what moves mortgage rates, why your quote differs from the average you see in the news, and how points, locks and buydowns work.

10 questions · about 2 minutes · no signup needed

Question 1 of 10The Federal Reserve sets mortgage rates directly.

TrueFalse

Question 2 of 10Thirty-year mortgage rates tend to move most closely with…

The 10-year Treasury yieldThe stock marketThe price of goldCredit card rates

Question 3 of 10Lenders can change their rates every day.

TrueFalse

Question 4 of 10The weekly average rate in the news is the rate everyone gets.

TrueFalse

Question 5 of 10On a conventional loan, a bigger down payment can lower your rate or pricing.

TrueFalse

Question 6 of 10One discount point costs…

1% of the loan amount1% of the home price per yearA flat $1,0000.1% of the loan

Question 7 of 10A rate lock protects you if rates rise before closing.

TrueFalse

Question 8 of 10In a 2-1 buydown, your rate is…

2 points lower the first year and 1 point lower the second, then the full rateLowered by 2 points for the life of the loanFixed for 2 years, then adjustableDoubled after year one

Question 9 of 10After its fixed period, an adjustable rate is usually set by…

A market index plus a set margin, within capsWhatever the lender choosesYour credit score that yearThe home’s value

Question 10 of 10Rates on investment properties are usually higher than on a home you live in.

TrueFalse

Your answers aren’t saved or sent anywhere except to calculate your score. For education only; it isn’t a credit check or a loan approval.

How it works

Pick an answer and you’ll see right away whether you got it, with a short explanation and a link to learn more. At the end you’ll get your score and can share it.