Today's Mortgage Rates & Trends - March 9, 2023: Rates Rise

After hitting an almost four-month high about a week ago but then dropping back, the 30-year mortgage average is on the rise again, with most other loan averages up as well.

Today's National Mortgage Rate Averages

Wednesday's 30-year average added another 11 basis points following a five-point gain the day before, raising the average to 7.20%. That's after notching 7.30% last week. Current rates are 1.09 percentage points more expensive than the five-month low of 6.11% registered just over a month ago. But compared to October's 20-year peak of 7.58%, rates are still about a third of a percentage point cheaper.

Rates on 15-year loans also increased Wednesday, though by a lesser six basis points. Now at 6.46%, the 15-year average is near its highest level since early November, but are still sitting almost six-tenths of a percentage point under October's 15-year high of 7.03%.

The Jumbo 30-year average meanwhile is stuck at 6.15%, having held there for six consecutive days now. Jumbo 30-year rates are at their highest mark since early November, and compared to October's 12-year high of 6.27%, are just an eighth of a point lower.

Wednesday's refinancing rates moved similarly to new purchase rates, with the 30-year refi average adding five basis points and the 15-year refi average climbing six points, while Jumbo 30-year refi rates again remained flat. The cost to refinance for 30 years is currently 27 basis points more expensive than 30-year new purchase loans.

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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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 will conclude March 22.

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.