Today's Mortgage Rates & Trends - March 23, 2023: Rates Inch Higher

Most mortgage averages rose Wednesday, though the movement was generally minimal. Rates on 30-year new purchase loans climbed two basis points, adding to the eighth of a point gain of the previous day.

Today's National Mortgage Rate Averages

Thirty-year mortgage rates have clawed back 15 of the 20 basis points they dropped last week. Rising another two basis points Wednesday, the 30-year average is back up to 6.92%. Since last fall, 30-year rates have fluctuated between October's historic 20-year peak of 7.58% and early February's five-month low of 6.11%.

Rates on 15-year loans meanwhile showed a bigger increase Wednesday. Climbing nine basis points, the 15-year mortgage average is now 6.17%, which is roughly the midpoint between the 15-year high of 7.03% seen in October and the 5.23% low point registered in the first days of February.

Jumbo 30-year rates were flat Wednesday, holding at a 5.77% average. That leaves Jumbo 30-year rates half a percentage point under October's 12-year high of 6.27%.

Wednesday's refinancing rates moved a bit differently than new purchase rates, with the 30-year refi average dipping seven basis points and the 15-year refi average rising a minor four points. The Jumbo 30-year refi average marked time like its new purchase counterpart. The cost to refinance for 30 years is currently 34 basis points more expensive than 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 in 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 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 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 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.