Mortgage Payment on a $325K House in Indianapolis (7.28%)

On a $325,000 Indianapolis house at 7.28%, expect about $2,250 a month with 20% down and about $2,800 with 5% down. That is Freddie Mac's 30-year average from Oct. 1, 2026, the highest since November 2023. The totals include estimated property tax, insurance and mortgage insurance, and run $108 to $128 a month more than at 6.66% in late August.

Rates move every week and this post is pinned to the number that was current when it ran: the Oct. 1, 2026 reading in the Freddie Mac Primary Mortgage Market Survey. Check that page for this week's national average, since your Indianapolis mortgage rates today will depend on your lender and your loan.

I'm Max Moore at Roots Realty Co., and I run these numbers every week for the Roots Deal Sheet. Below, I put 7.28% against a real Marion County tax bill at 20% down, 5% down and FHA. Then I show what a buydown, a price cut or waiting does to the payment.

What is the mortgage payment on a $325,000 house in Indianapolis at 7.28%?

The Freddie Mac Primary Mortgage Market Survey put the 30-year fixed rate at 7.28% on Oct. 1, 2026. That is up from 7.03% a week earlier and 6.66% on Aug. 27, the sixth weekly rise in a row. It is the highest reading since Nov. 22, 2023, when the average was 7.29%, and a year ago it was 6.34%.

The assumptions behind every table

• Price: $325,000 is a round example price. It is not a quote of any median. Table 2 shows $250,000 to $500,000.
• Loan: 30-year fixed. We used one rate for all three loan types, but real FHA and conventional rates differ.
• Property tax: 1.00% of price, or $3,250 a year ($271 a month). That is the homestead cap in the Indiana DLGF circuit breaker fact sheet, and you only get it if the homestead standard deduction is on the property. Our Oct. 2 tax post used the 2026 certified rate for the Indianapolis Center district, 2.7291 per $100, and modeled $4,200 before the cap and $2,950 after the cap and the $300 homestead credit on a house this price. So 1% runs slightly high. Here is how Marion County property taxes work and how to file the homestead deduction.
• Insurance: $2,400 a year ($200 a month). Insurify listed $2,356 for a $300,000 dwelling with a $1,000 deductible in Indianapolis (updated May 2025). Get a current quote, because that figure is old.
• Mortgage insurance at 5% down: 0.85% of the loan a year, or $219 a month. That is our assumption for a borrower with strong credit. Your lender's quote will differ.
• FHA at 3.5% down: base loan $313,625, plus the 1.75% upfront premium ($5,488) financed into a $319,113 loan. The annual premium is 0.55% of the base loan ($144 a month), per HUD Mortgagee Letter 2023-05. Because this loan is above 95% of the home's value, the premium lasts for the loan term.
• Down payment at 5%: $16,250. Totals use unrounded numbers, so a column can differ from its parts by $1.

Takeaway: Between August's 6.66% and today's 7.28%, the payment on this house rose about $108 a month with 20% down and about $128 with 5% down. That is $1,300 to $1,500 a year.

20% down: $260,000 loan, no mortgage insurance

Every row adds $271 tax and $200 insurance a month. There is no mortgage insurance.

5% down: $308,750 loan, mortgage insurance at 0.85%

Every row adds $271 tax, $200 insurance and $219 mortgage insurance a month.

FHA, 3.5% down: $319,113 loan with the upfront premium financed

Every row adds $271 tax, $200 insurance and a $144 FHA premium a month.

Why 6.00%? The Freddie Mac 52-week low was 5.98% on Feb. 26, 2026. Why 6.66%? That was the reading on Aug. 27 and on July 30.

At the same rate, FHA and 5% conventional land within $4 a month of each other here. Ask any lender how long the mortgage insurance lasts and when it can come off.

Sources: rates from the Freddie Mac PMMS history file; tax cap from the Indiana DLGF; FHA premiums from HUD Mortgagee Letter 2023-05; insurance from Insurify. Mortgage insurance on conventional loans is our assumption.

How much did the rate jump cost, and what does it do to the price I can afford?

Takeaway: Each extra $100,000 of price adds about $40 a month to the cost of the rate jump. A $250,000 buyer feels about $99 with 5% down, and a $500,000 buyer about $198.

Detail by price:

• $250,000: loan with 5% down $237,500, P&I $1,526 at 6.66% and $1,625 at 7.28%, extra a month with 20% down $83
• $325,000: loan with 5% down $308,750, P&I $1,984 at 6.66% and $2,113 at 7.28%, extra a month with 20% down $108
• $400,000: loan with 5% down $380,000, P&I $2,442 at 6.66% and $2,600 at 7.28%, extra a month with 20% down $133
• $500,000: loan with 5% down $475,000, P&I $3,052 at 6.66% and $3,250 at 7.28%, extra a month with 20% down $166

Note: Totals use tax at 1.00% of price, insurance at 0.74% of price (scaled from $2,400 on $325,000) and mortgage insurance at 0.85% of the loan. The extra columns count principal and interest only, because tax, insurance and mortgage insurance do not move with the rate.

Flip it around. The all-in payment on a $325,000 house at 6.66% with 5% down was $2,674. In this model, that same $2,674 buys about $310,100 of house at 7.28%, roughly $14,900 less house for the same monthly check.

Is 7% a high mortgage rate?

It is high against the past year. Freddie Mac's 30-year average ran from a low of 5.98% on Feb. 26, 2026 to 7.28% on Oct. 1.

It is not high against history, though. The weekly average since the survey began in 1971 is 7.68% (computed from the Freddie Mac history file), and the rate hit 7.79% on Oct. 26, 2023.

That context helps you stay calm. It does not change your budget. The number that matters is the monthly payment you can carry with room left over, and Table 1 shows what 7.28% does to it. For what a weekly rate move costs at a $198,000, $325,000 and $807,000 price point, see Tyler Lingle's breakdown of what an Indianapolis mortgage rate costs you.

What is a 2-1 buydown, a permanent buydown and a seller concession?

A seller concession is money the seller agrees, in the purchase contract, to put toward your closing costs or a rate buydown. Fannie Mae caps it by down payment. For a principal residence with a loan-to-value above 90%, which is any down payment under 10%, the cap is 3% of the price.

That is $9,750 on $325,000. It is 6% at 75.01% to 90% loan-to-value and 9% at 75% or less, per the Fannie Mae Selling Guide.

A permanent buydown means you pay discount points up front. One point costs 1% of the loan and usually cuts the rate by about 0.25%, depending on the lender. Freddie Mac's example is a $300,000 loan where one point costs $3,000 and trims about $48 off the monthly principal and interest.

A 2-1 temporary buydown lowers your rate 2 points in year one and 1 point in year two. In year three you pay the full rate. The seller's money sits in escrow and covers the gap, and most lenders still qualify you at the full rate, so confirm that with yours.

A 1-0 works the same way for one year at 1 point.

Rate buydown vs price reduction: which saves more on a $325,000 house?

Here is one example. The house is $325,000, the loan is conventional with 5% down ($308,750) and the rate is 7.28%. The seller offers $9,750, the 3% cap, and we compare four ways to use it.

Assumptions for Table 3

• A point cuts the rate about 0.25%. That is a rule of thumb from Freddie Mac and the CFPB, and real pricing varies by lender and by day, so the 6.49% rate here is illustrative.
• The 2-1 cost is 24 months of payment difference, which the seller's escrow pays to your lender.
• The price cut also lowers tax, insurance and mortgage insurance a little. We did not count that.

Takeaway: Spent on a permanent buydown, $9,750 saves about $163 a month. Spent on a price cut, it saves about $63. Spent on a 2-1, it saves about $402 a month in year one and costs about $7,300.

• Price cut: the price drops to $315,250 and the loan to $299,488, which also trims tax, insurance and PMI a little.
• Permanent buydown: about 3.16 points, for a rate near 6.49%. Break-even on the cost is about 60 months.
• 2-1 buydown: 5.28% in year 1 ($1,711), 6.28% in year 2 ($1,907), then 7.28% ($2,113). It costs about $7,287, which leaves about $2,463 of the concession for closing costs. It fits a raise coming or a plan to refinance by year 3.

To match the permanent buydown's payment of $1,950 with a price cut alone, the price would have to drop about $25,000. The price cut leaves you owing the least after five years ($282,740, against $291,484 for the baseline), which matters if you sell or refinance early. The permanent buydown wins on monthly cost if you stay.

Words on a listing can hide which one you are getting. In the Sept. 18 Deal Sheet, I flagged a listing at 202-204 N Hamilton Avenue, asking $459,900, that advertised a 1 percent rate buydown. This is what I wrote after our agent Ken Fletcher checked with the listing agent:

The listing advertises a 1 percent rate buydown. Ken confirmed with the listing agent that it is a temporary 1-0, a $2,483 escrow covering about $207 a month for twelve months, not a permanent rate reduction.

A permanent 1% cut keeps saving every month. A 1-0 stops after twelve.

Ask which one you are getting, in writing, with the dollar amount and the number of months. Our earlier rate buydown guide covers how to ask for concessions in the offer.

Should I buy a house now or wait for interest rates to drop?

Nobody can forecast rates, so I would rather give you the break-even than a guess. If you wait a year, the rate has to fall and prices have to behave. Here is the math on the same $308,750 loan.

Takeaway: If you wait a year and the rate falls back to 6.66%, prices only need to rise about 6.5% for waiting to cost you more per month than buying now.

For the price column, MIBOR's August 2026 report shows the 12-month median price for existing homes at $299,000, up 4.2% from $287,000 a year earlier (Indiana REALTORS Housing Hub). If prices rise 4.2% and the rate falls back to 6.66%, you save about $45 a month. You would also need $682 more down at 5%, you would have paid a year of rent, and you would have skipped a year of paying down a loan.

The table ignores rent, closing costs, tax and insurance, so treat it as a sketch.

I hear the same objection from renters most weeks. In my renter-versus-buyer walkthrough on Numbers w/ Max, I describe what they tell me: "I need to wait until rates drop. I need to wait until prices are going to come down. I just need more time."

That can be a responsible thought. Run the numbers before you act on it.

Rates also move faster than a pre-approval letter. In the July 17 Deal Sheet I wrote, "Rates are holding in the high 6s, so get your real number and buy on value." By Oct. 1 the rate was 7.28%. In the Aug. 14 issue I wrote, "If your pre-approval is from July, it is quoting you a rate that no longer exists."

What about "marry the house, date the rate"?

It means you buy the house you want now and refinance if rates fall. It can work. It is not a plan, because you need rates to fall and you need to stay long enough to earn back the closing costs.

Takeaway: Refinancing to 6.50% after a year would save about $180 a month and take about 34 months to pay back at an assumed 2% in closing costs.

Assumptions: the $308,750 loan at 7.28% for 12 months, leaving a balance of $305,779. The new loan is a fresh 30-year loan. Closing costs are 2% of the balance ($6,116), which is our assumption, so get a real quote.

A refinance also restarts the 30-year clock. If you plan to move in four years, a 34-month break-even leaves you with very little saved.

Can house hacking soften a 7.28% payment?

It can, and an owner who rents out the other side of a duplex is the clearest case. In a Numbers w/ Max episode on whether a 22-year-old earning $73,000 can buy a house, I ran a $325,000 duplex with 5% conventional down and a $1,500 tenant in one side. The line was, "You're looking at 2365 per month estimated," which nets to $865 a month after the tenant's rent.

For more on this strategy, see our house hacking numbers in Indianapolis.

I re-ran that scenario at 7.28%. The episode does not state a rate, so I assumed the January 2026 reading of 6.06% (Freddie Mac, Jan. 15, 2026) and changed only principal and interest. On a $308,750 loan, that moves from $1,863 to $2,113, up $249.

The $2,365 becomes about $2,614, and the $865 becomes about $1,114 after the same $1,500 rent.

This is a re-run with assumptions, not a quote. The episode did not list the tax and insurance it used, and a full model at the January rate gives a higher payment than $2,365.

A duplex is also taxed differently: the rented half generally falls under the 2% cap, so a blended rate near 1.5% is more realistic than 1%. With 1.5% tax, $250 insurance and $1,500 rent, I get about $2,987 a month on a 5% conventional loan, or about $1,487 after rent. With FHA it is about $2,983, or about $1,483.

FHA requires you to live in one of the units.

What would I do this week?

1. Get a real quote today. A rate from July is not a rate. Ask for the rate, the points and the lender fees on one page.
2. Ask for any buydown in writing. Is it permanent or temporary, how many months, and how many dollars? The Hamilton Avenue listing is why I ask.
3. Use the real tax bill, not the seller's. Deductions can end with a change in title, so budget up to 1% of the price and file your own homestead deduction after you close.
4. Count the cash to close. On the $300,000 home in my renter-versus-buyer episode I said you need "about $15,000 in liquidity ready to go." On $325,000 with 5% down, the down payment alone is $16,250 before closing costs.
5. Buy the payment, not the rate. Pick the monthly number you can carry at today's rate with room left over. Treat any later drop as a bonus, not a plan.

Want us to run your numbers?

At 7.28%, a $325,000 Indianapolis house costs about $108 to $128 a month more than it did in August. A buydown, a price cut or a wait each change that number, and which one helps depends on how long you stay and how much cash you have.

The only way to know yours is to run it with the real tax bill and a real quote. Bring a listing, a tax bill and your pre-approval letter, and I will walk through the payment with you at today's rate and at one point higher. Grab a coffee with me or the team.

Sources: Freddie Mac PMMS history file (rates, Oct. 1, 2026); Indiana DLGF circuit breaker fact sheet; Fannie Mae Selling Guide B3-4.1-02; HUD Mortgagee Letter 2023-05; Indiana REALTORS Housing Hub, MIBOR August 2026; Insurify; Roots Deal Sheets of July 17, Aug. 14 and Sept. 18, 2026; Numbers w/ Max. Estimates only, not a loan offer.