The interest rate paid on a debt for which property has been provided as security is known as a mortgage interest rate. Mortgage interest rates are probably the most keenly tracked interest rates in America. This is because a small change in the mortgage interest rate can affect a large number of people who have used mortgages to finance their purchase of a home. Mortgage interest rates are also a dynamic macroeconomic indicator of the economy. Usually, a rise in mortgage interest rates leads to a drop-off in home sales and refinancing.

There are two kinds of mortgages that are of significance. They are the fixed rate mortgage (FRM) and adjustable rate mortgage (ARM). In case of fixed rate mortgages, the interest rate, and hence monthly payment, remains fixed for the term of the loan. This term can vary from anywhere between 10 to 30 years.

In case of adjustable rate mortgages, the interest rate is fixed for an initial period of time after which it is periodically adjusted depending on the movements in the economic index to which it is linked.

The recent consecutive hikes in interest rates by the Federal Reserve have pushed the average mortgage interest rate for a 30 year FRM close to 7%. The new chairman of the Federal Reserve, Ben Bernanke, has indicated that further hikes in interest rates may be on the cards. If you are planning to use a mortgage to finance a new home purchase, it's best to act quickly to avoid the prospect of rate hikes in the future

To get the best mortgage interest rates, you need to research mortgage options. It's advisable to check rates at local banks work with a mortgage broker work to find what's best suited to your needs. You or your mortgage broker can scope out mortgages online.

You also need to make sure you are qualified for a mortgage loan. Check your credit report, clear up any errors and resolve any outstanding issues. It's usually a good idea to work with your mortgage broker to get pre-qualified for a mortgage, so that you know how much you qualify for and what kind of house to begin shopping for.