Today's Mortgage Rates & Trends - April 5, 2023: Rates Edge Lower

The pattern of mortgage rates mildly fluctuating in a relatively narrow range continued Tuesday, with the 30-year fixed-rate average giving up a few basis points. Almost every other average also showed minimal movement, or held steady entirely.

Today's National Mortgage Rate Averages

Rates on 30-year new purchase mortgages dipped slightly Tuesday. Subtracting 3 basis points, the flagship average is down to 6.63%, keeping it in the range of 6.5% and 7% that it's sustained for three and a half weeks. It's also closer to the lower end of the span between early February's five-month low of 6.11% and October's 20-year high of 7.58%.

Tuesday also saw 15-year rates decline, with the average giving up a mild 2 basis points. Now 5.90%, the 15-year average continues to waver between the 5.23% low valley of February and the 15-year high of 7.03% seen in October.

Jumbo 30-year rates meanwhile were flat again Tuesday. Registering a fourth consecutive reading of 5.77%, the average is sitting half a percentage point cheaper than October's 12-year-high average of 6.27%.

Refinancing rates moved roughly in line with new purchase rates Tuesday. The 30-year refi average gave up only a single basis point while the 15-year refi average shed 6 points. The jumbo 30-year refi average again held steady like its new purchase counterpart. The cost to refinance for 30 years is currently 35 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.

Calculate monthly payments for different loan scenarios with our Mortgage Calculator.

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.