Today's Mortgage Rates & Trends - December 8, 2022: Rates bobbing

30-year average dips again to extend yo-yo pattern in mid-6% range

MR1208

It's been a week since the 30-year mortgage average returned briefly to 7% territory. But since then rates have bobbed up and down, with Wednesday being the third time the flagship average has sunk to 6.50%.

National Averages of Lenders' Best Rates
Loan Type Purchase Refinance
30-Year Fixed 6.50% 6.82%
FHA 30-Year Fixed 6.78% 7.17%
Jumbo 30-Year Fixed 5.64% 5.65%
15-Year Fixed 5.86% 6.13%
5/6 ARM 6.94% 7.06%
National averages of the lowest rates offered by more than 200 of the country's top lenders, with a loan-to-value ratio (LTV) of 80%, an applicant with a FICO credit score of 700–760, and no mortgage points.
2022.11.29

Today's National Mortgage Rate Averages

Yet again, the 30-year average dropped to 6.50%, subtracting the same 14 basis points Wednesday that it added the day before. That leaves the average at its lowest point since September 16, and also more than a full percentage point below the 20-year high of 7.58% it averaged in mid-October.

Rates on 15-year loans also dipped Wednesday, by six basis points to average 5.86%. Compared to their own October peak of 7.03%, which was their highest mark in 15 years, the 15-year average is currently 1.17% lower.

Jumbo 30-year rates meanwhile dropped an eighth of a point for a second consecutive day. Now down to 5.64%, Wednesday's Jumbo 30-year average is almost two-thirds of a percentage point cheaper than its 6.27% reading last month, which was the most expensive Jumbo 30-year mark since 2010.

Rates moved more dramatically lower Wednesday for 30-year refinancing loans than for new purchases, with the 30-year refi average dropping a bold 27 basis points. The 15-year refi average meanwhile lost a more modest nine points and the Jumbo 30-year refi average, an eighth of a percentage point again. The cost to refinance with a 30-year loan is currently 32 basis points more expensive than a new purchase loan.

After a historical rate plunge in August 2021, mortgage rates skyrocketed in the first half of this year. 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 this fall dramatically outdid the summer high, with late October's 30-year average reaching 1.2 percentage points higher than the June peak.

The rates you see here generally won’t compare directly with teaser rates you see advertised online, since those rates are cherry-picked as the most attractive. They may involve paying points in advance, or they may be selected based on a hypothetical borrower with an ultra-high credit score or taking a smaller-than-typical loan given the value of the home.

National Averages of Lenders' Best Rates - New Purchase
New Purchase Daily Change
30-Year Fixed 6.50% -0.14
FHA 30-Year Fixed 6.78% -0.04
VA 30-Year Fixed 6.70% -0.05
Jumbo 30-Year Fixed 5.64% -0.13
20-Year Fixed 6.07% -0.22
15-Year Fixed 5.86% -0.06
Jumbo 15-Year Fixed 5.90% -0.12
10-Year Fixed 5.84% -0.08
10/6 ARM 6.81% +0.01
7/6 ARM 6.78% -0.03
Jumbo 7/6 ARM 5.61% No change
5/6 ARM 6.94% -0.06
Jumbo 5/6 ARM 5.69% No change
National Averages of Lenders' Best Rates - Refinance
Loan Type Refinance Daily Change
30-Year Fixed 6.82% -0.27
FHA 30-Year Fixed 7.17% -0.11
VA 30-Year Fixed 7.41% +0.07
Jumbo 30-Year Fixed 5.65% -0.12
20-Year Fixed 6.30% -0.18
15-Year Fixed 6.13% -0.09
Jumbo 15-Year Fixed 5.90% -0.12
10-Year Fixed 6.11% -0.15
10/6 ARM 7.07% +0.02
7/6 ARM 7.03% -0.09
Jumbo 7/6 ARM 5.69% No change
5/6 ARM 7.06% -0.03
Jumbo 5/6 ARM 5.69% No change

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

Lowest Mortgage Rates by State

The lowest mortgage rates available vary depending on the state where originations occur. Mortgage rates can be influenced by state-level variations in credit score, average mortgage loan term, and size, in addition to individual lenders' varying risk management strategies.

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 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 last November, 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 takes place December 13-14.

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.