Homebuyers Can Improve Mortgage Rates Through Credit and Down Payment Strategies
A new Realtor.com® report reveals that mortgage rates vary significantly among borrowers, even within the same month. Using data from over 1.35 million purchase loans between January 2023 and December 2025, the analysis shows a middle 80% of borrowers received rates spanning up to 93 basis points—equivalent to about $28,400 in additional buying power on a $2,000 monthly payment. The report highlights that factors such as credit scores, down payments, and lender selection play critical roles in determining the actual rate offered. The analysis emphasizes key thresholds for improving rates: crossing 700 or 720 FICO score levels can reduce mortgage rates by up to five basis points each. Additionally, while a 20% down payment eliminates mortgage insurance costs, moving from 5–9% to 10–14% down improves the rate more significantly than reaching exactly 20%. The report also notes that shopping among lenders and evaluating total housing costs—beyond just interest rates—are essential for maximizing affordability.
Topics: borrower affordability credit scores down payments mortgage rates