Today's Mortgage Rates & Trends - April 18, 2023: Rates Rise Again

Most mortgage averages rose for a second day Monday, including another several-point increase for 30-year rates. The flagship average is now at an almost four-week high. Only the 5/6 ARM average moved notably the other way, plummeting more than a third of a point Monday.

Today's National Mortgage Rate Averages

Rates on 30-year loans added another 6 basis points Monday, piling on to a 22-point jump Friday. The two-day ascent has taken the average back up to 6.87%, its most expensive reading since March 22. Still, it continues a wavering pattern of the last two months, with the average moving around between February's five-month low of 6.11% and October's 20-year high of 7.58%.

The 15-year average gained similarly Monday, bumping up 7 basis points to 6.10%. Like its 30-year counterpart, the 15-year average has been yo-yoing between the bookends of a February five-month low (5.23%) and an October 15-year high (7.03%).

Jumbo 30-year rates were steady Monday, after climbing an eighth of a point Friday. Holding at 5.90%, the flagship jumbo average is sitting at its highest mark since March 29, which is only roughly a third of a point cheaper than October's 12-year-high of 6.27%.

Movement in refinancing rates was similar Monday to new purchase rates. The 30-year refi average tacked on 5 basis points and the 15-year average, 4 points. The jumbo 30-year refi average held still. The cost to refinance for 30 years is currently 28 basis points more expensive than 30-year new purchase rates.

After a historical rate plunge in August 2021, mortgage rates skyrocketed in the first half of 2022. Indeed, the 30-year average's mid-June peak of 6.38% was almost 3.5 percentage points above its summer 2021 trough of 2.89%. But the surge last September and October dramatically outdid the summer high, with the 30-year average ultimately reaching 1.2 percentage points higher than the June peak.

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What Causes Mortgage Rates to Rise or Fall?

Mortgage rates are determined by a complex interaction of macroeconomic and industry factors, such as the level and direction of the bond market, including 10-year Treasury yields; the Federal Reserve's current monetary policy, especially as it relates to funding government-backed mortgages; and competition between mortgage lenders and across loan types. Because fluctuations can be caused by any number of these at once, it's generally difficult to attribute the change to any one factor.

Macroeconomic factors had kept the mortgage market relatively low for much of 2021. In particular, the Federal Reserve had been buying billions of dollars of bonds in response to the pandemic's economic pressures. This bond-buying policy (and not the more publicized federal funds rate) is a major influencer on mortgage rates.

But starting in November 2021, the Fed began tapering its bond purchases downward, making sizable reductions each month until reaching net-zero in March 2022.

The Fed's rate and policy committee, called the Federal Open Market Committee (FOMC), meets every six to eight weeks. Their next scheduled meeting will conclude on May 3, 2023.

Methodology

The national averages cited above were calculated based on the lowest rate offered by more than 200 of the country's top lenders, assuming a loan-to-value ratio (LTV) of 80% and an applicant with a FICO credit score in the 700–760 range. The resulting rates are representative of what customers should expect to see when receiving actual quotes from lenders based on their qualifications, which may vary from advertised teaser rates.

For our map of the best state rates, the lowest rate currently offered by a surveyed lender in that state is listed, assuming the same parameters of an 80% LTV and a credit score between 700–760.