Today's Mortgage Rates & Trends - April 20, 2023: Rates Continue Surge

Most mortgage averages moved higher again Wednesday, in what is a fourth day of gains for many loan types. The ascent of 30-year rates has taken the flagship average back above 7% for the first time in almost six weeks, while the Jumbo 30-year average has risen back above 6%.

Today's National Mortgage Rate Averages

Successive increases in 30-year rates have raised the average 44 basis points over four days, with Wednesday's 7-basis-point increase taking the average to 7.03%. It's the first time back above 7% since March 9, after sinking to the mid 6% range as recently as last Thursday. The average is now closer to the 20-year high of 7.58% notched in October than February's five-month low of 6.11%.

Rates on 15-year loans also climbed moderately, tacking on another 6 basis points Wednesday to accumulate a four-day rise of 43 points. Now up to 6.30%, the 15-year average is also at its most expensive mark since March 9, and continues moving within a range between its five-month low of 5.23% from February and the 15-year high of 7.03% seen in October.

After holding for two days, jumbo 30-year rates were back on the rise Wednesday, breaking back through the 6% threshold. With a bold eighth of a point increase, the jumbo 30-year average is up to 6.02%, a level it hasn't seen since March 13. It's also now just a quarter point below October's 12-year-high of 6.27%.

Refinancing rates moved somewhat in line with new purchase rates Wednesday. The 30-year refi average added a bigger 14 basis points, and the 15-year average, 10 points. Like its new purchase counterpart, the jumbo 30-year refi climbed an eighth of a point. The cost to refinance for 30 years is currently 41 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.