Key Takeaways
- Expert insights on mortgage rates in sacramento 2026: current rates, lenders & market guide
- Actionable strategies you can implement today
- Real examples and practical advice
Mortgage Rates in Sacramento 2026: Current Rates, Lenders & Market Guide
If you're buying a home in Sacramento, understanding today's mortgage rates is essential. Sacramento offers California's capital with state-government stability and Bay Area spillover demand. In this comprehensive guide, we break down current mortgage rates by loan type, highlight top local lenders, analyze market conditions, and share tips to help you lock in the best rate.
Current Mortgage Rates in Sacramento (February 2026)
Mortgage rates fluctuate daily based on Federal Reserve policy, inflation data, and bond market movements. Here's a snapshot of average rates for Sacramento-area borrowers as of early 2026:
Conventional Fixed-Rate Mortgages
- 30-Year Fixed: 6.25% – 6.75% APR
- 20-Year Fixed: 6.00% – 6.50% APR
- 15-Year Fixed: 5.50% – 6.00% APR
Conventional loans remain the most popular option for Sacramento homebuyers with good credit (typically 680+) and at least 5% down. If you can put 20% down, you'll avoid private mortgage insurance (PMI), saving hundreds per month.
Adjustable-Rate Mortgages (ARMs)
- 5/1 ARM: 5.75% – 6.25% APR
- 7/1 ARM: 5.90% – 6.40% APR
- 10/1 ARM: 6.00% – 6.50% APR
ARMs offer lower initial rates, which can be attractive if you plan to sell or refinance within the fixed-rate period. Given Sacramento's dynamic housing market, ARMs can make sense for buyers who don't plan to stay in their home for more than 5–7 years.
FHA Loans
- 30-Year FHA: 5.75% – 6.50% APR
- Minimum Down Payment: 3.5% (with 580+ credit score)
FHA loans are popular among first-time buyers in Sacramento, especially in neighborhoods like Midtown, East Sacramento, and Elk Grove. The lower credit and down payment requirements make homeownership accessible, though you'll pay mortgage insurance premiums (MIP) for the life of the loan.
VA Loans
- 30-Year VA: 5.50% – 6.25% APR
- Down Payment: 0% for eligible veterans
For veterans and active-duty military in the Sacramento area, VA loans offer the best rates with no down payment and no PMI. Sacramento's proximity to military installations and VA facilities makes this a popular option.
Jumbo Loans
- 30-Year Jumbo: 6.50% – 7.25% APR
- Threshold: Loans above $766,550 (or higher in some high-cost CA counties)
If you're shopping for higher-priced properties in Sacramento's premium neighborhoods, you'll likely need a jumbo loan. These require stronger credit profiles (720+), larger down payments (typically 10–20%), and more cash reserves.
HELOC and Home Equity Loans
Already own a home in Sacramento? A home equity line of credit (HELOC) lets you tap your equity at competitive variable rates, typically prime rate + 0.5% to 2%. Current HELOC rates in Sacramento range from 7.50% to 9.50% depending on your credit, LTV ratio, and lender. HELOCs are ideal for renovations, debt consolidation, or funding investment properties.
Sacramento Housing Market Overview 2026
Understanding the local market context is critical for making smart borrowing decisions.
Median Home Prices
Sacramento's median home price has seen steady movement over the past few years. As of early 2026, the metro area's median sits in line with broader California trends, though specific neighborhoods vary dramatically. Desirable areas like Midtown, East Sacramento, and Elk Grove command premiums, while emerging neighborhoods offer more affordable entry points.
Inventory and Competition
The Sacramento market in 2026 is characterized by moderate inventory levels. After the pandemic-era frenzy, the market has normalized somewhat, though well-priced homes in popular neighborhoods still attract multiple offers. Days on market have stabilized compared to the rapid pace of 2021–2022, giving buyers slightly more negotiating power.
Population Growth and Demand
Sacramento continues to attract new residents thanks to California's capital with state-government stability and Bay Area spillover demand. This population growth sustains housing demand, which in turn supports property values. For investors considering DSCR loans, this demand translates into strong rental occupancy rates.
Economic Drivers
The local economy is diversified and resilient. Major employers span multiple sectors, providing a stable employment base that supports the housing market. Unemployment in the Sacramento metro remains below the national average, which bodes well for mortgage performance and property values.
Top Local Mortgage Lenders in Sacramento
While national lenders like Wells Fargo, Chase, and Rocket Mortgage serve Sacramento, local and regional lenders often offer better rates and more personalized service.
Golden 1 Credit Union
A well-established institution in the Sacramento area, Golden 1 Credit Union offers competitive rates on conventional, FHA, and VA loans. Their local underwriting teams understand Sacramento's unique market dynamics, which can lead to smoother closings.
Pros: Local decision-making, competitive rates, relationship banking discounts Cons: May have fewer digital tools than national fintech lenders
Sacramento Credit Union
Credit unions like Sacramento Credit Union offer member-focused lending with typically lower rates and fees than traditional banks. Membership is usually open to California residents.
Pros: Lower fees, member dividends, community focus Cons: May require membership, fewer branch locations
Five Star Bank
Five Star Bank rounds out the local lending landscape with portfolio lending options and flexible underwriting for unique situations.
Pros: Flexible underwriting, portfolio products, local expertise Cons: May have higher rates on standard products
Online and Fintech Lenders
Don't overlook digital-first lenders. Companies like Better.com, Guaranteed Rate, and HonestCasa offer streamlined applications, quick pre-approvals, and competitive rates. HonestCasa specializes in HELOCs and DSCR loans for Sacramento-area homeowners and investors.
Factors Affecting Your Mortgage Rate in Sacramento
Your individual rate depends on several factors beyond the market averages listed above:
Credit Score
Your credit score is the single biggest factor in your mortgage rate. In Sacramento's competitive market, borrowers with 740+ scores access the best rates, while those in the 620–680 range may pay 0.5% to 1.5% more. Before applying, check your credit reports at AnnualCreditReport.com and dispute any errors.
Down Payment
Larger down payments mean lower rates and no PMI. While Sacramento's prices may make 20% down challenging for some buyers, even moving from 5% to 10% down can meaningfully improve your rate.
Loan-to-Value Ratio (LTV)
Related to your down payment, a lower LTV ratio signals less risk to lenders. If you're refinancing a Sacramento home, having built up equity through appreciation helps you qualify for better terms.
Debt-to-Income Ratio (DTI)
Lenders prefer a DTI below 43%, though some programs allow higher. If you're carrying student loans, car payments, or credit card debt, paying these down before applying can unlock better rates.
Property Type
Single-family homes get the best rates. Condos, multi-family properties, and investment properties carry rate premiums. If you're buying a rental property in Sacramento, expect rates 0.25% to 0.75% higher than a primary residence.
Loan Type and Term
As shown above, 15-year loans and ARMs typically offer lower rates than 30-year fixed mortgages. Your choice should balance monthly affordability with total interest paid over the life of the loan.
Tips to Get the Best Mortgage Rate in Sacramento
1. Shop Multiple Lenders
According to Freddie Mac, borrowers who get quotes from at least three lenders save an average of $1,500 over the life of their loan. In Sacramento, compare at least one national lender, one local bank or credit union, and one online lender.
2. Get Pre-Approved Early
A pre-approval letter shows sellers you're serious and locks in a rate (usually for 60–90 days). In Sacramento's competitive neighborhoods, offers without pre-approval are often rejected outright.
3. Consider Buying Points
Mortgage points (each point = 1% of loan amount) buy down your rate by approximately 0.25%. If you plan to stay in your Sacramento home for 5+ years, buying points often pays for itself. Use a mortgage calculator from the CFPB to run the numbers.
4. Lock Your Rate at the Right Time
Mortgage rates move daily. Once you have an accepted offer, consider locking your rate immediately rather than floating. In a volatile rate environment, the certainty is usually worth it. Ask your lender about float-down options in case rates drop before closing.
5. Improve Your Credit Before Applying
Even a 20-point credit score improvement can save thousands. Pay down credit card balances below 30% utilization, avoid opening new accounts, and correct any errors on your reports. Give yourself 2–3 months of clean credit history before applying.
6. Explore Down Payment Assistance
California and Sacramento offer various down payment assistance programs for first-time and qualifying buyers. These can include grants, forgivable loans, and reduced-rate first mortgages. Check with the California Housing Finance Authority for current offerings.
7. Consider Alternative Loan Products
If traditional mortgages don't fit your situation, explore options like:
- DSCR loans for investment properties (qualification based on rental income, not personal income)
- HELOCs for tapping existing equity
- Bank statement loans for self-employed borrowers
- Construction loans for new builds
Sacramento Mortgage Rate Forecast 2026
While no one can predict rates with certainty, here's what economists and market analysts are watching:
Federal Reserve Policy
The Fed's rate decisions directly impact short-term rates and indirectly affect mortgage rates. As of early 2026, the market expects the Fed to continue its data-dependent approach, with potential rate adjustments tied to inflation and employment figures.
Inflation Trends
Mortgage rates closely track inflation expectations. If inflation continues moderating toward the Fed's 2% target, mortgage rates should stabilize or decline modestly through 2026. Persistent inflation above target would keep rates elevated.
Housing Supply
New construction in the Sacramento metro area is helping address the housing supply shortage, though building hasn't fully kept pace with demand. Increased supply could moderate price growth, while continued shortages support appreciation.
Expert Predictions
The Mortgage Bankers Association and National Association of Realtors project rates in the mid-6% range through 2026, with potential for movement into the high-5% range if economic conditions cooperate. For Sacramento specifically, local market strength may keep demand—and by extension, rates—slightly above national averages.
Is Now a Good Time to Buy in Sacramento?
The age-old question. Here's a balanced perspective:
Arguments for buying now:
- Sacramento's long-term growth trajectory remains strong
- Renting costs continue to rise, building no equity
- You can always refinance if rates drop
- Tax benefits of homeownership (mortgage interest deduction, property tax deduction)
Arguments for waiting:
- Rates may moderate later in 2026
- More inventory could mean less competition
- Economic uncertainty could create buying opportunities
The reality: timing the market perfectly is nearly impossible. If you've found a home you love in Sacramento at a price you can afford, today's rates—while higher than the anomalous 2020–2021 lows—are historically reasonable. The best time to buy is when you're financially ready.
Final Thoughts
Sacramento's housing market in 2026 offers opportunities for buyers, sellers, and investors alike. By understanding current mortgage rates, shopping multiple lenders, optimizing your financial profile, and choosing the right loan product, you can make a smart purchase that builds long-term wealth.
Whether you're a first-time buyer exploring FHA options in Midtown or an investor evaluating DSCR loans for a rental property, the key is preparation and comparison shopping.
Ready to explore your options? HonestCasa offers competitive HELOCs and DSCR loans for Sacramento-area homeowners and investors. Get your personalized rate quote today.
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