An interest rate for mortgages is the percentage a lender charges you to borrow money for purchasing a home. It’s applied to the loan balance and paid over time, usually as part of your monthly mortgage payment.

You can lock in a mortgage rate by working with a lender who offers a rate lock agreement—a formal commitment to hold your quoted interest rate for a set period, typically 30 to 60 days, while your loan is processed.

Mortgage closing costs typically range from 2% to 5% of your loan amount. For example, if you're borrowing $300,000, your closing costs could fall between $6,000 and $15,000.

The Federal Reserve (the Fed) doesn't set mortgage rates directly, but it strongly influences them through its monetary policy decisions.

The interest rate is the base cost of borrowing money, while the APR includes both the interest rate and additional fees like origination, points, and mortgage insurance. APR gives you a more complete picture of the loan’s true cost over time.