Today's Mortgage Rates & Trends - November 24, 2022: Rates waver

After starting the week with a boost that took the 30-year mortgage average almost back to 7%, mortgage rates have moved slightly lower the last two days.

Today's National Mortgage Rate Averages

Rates on 30-year loans climbed close to 7% again on Monday, but have edged down slightly the last two days. Shedding two basis points Wednesday, the flagship average is currently 6.95%. Though still elevated, 30-year rates are almost two-thirds of a point cheaper than the 20-year high of 7.58% recorded in mid-October.

The 15-year average also dipped two basis points Wednesday. Now at 6.19%, the average is sitting 84 basis points below last month's peak of 7.03%, which was its highest level since 2007.

Jumbo 30-year rates meanwhile remained flat for a fourth day, holding Wednesday at 5.90%. The current Jumbo average is 37 basis points under the 6.27% reading of late October, which was its most expensive level in 12 years.

Wednesday's refinancing rates moved similarly to new purchase rates, with the 30-year refi average inching up a single basis point, the 15-year average declining two points, and Jumbo 30-year refi rates again holding steady. The current cost to refinance with a fixed-rate loan is up to 57 basis points more expensive than new purchase rates.

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 has dramatically outdone the summer peak, with late October's 30-year average reaching 1.2 percentage points above the June high.

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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 have kept the mortgage market relatively low for much of this year. In particular, the Federal Reserve has been buying billions of dollars of bonds in response to the pandemic's economic pressures, and it continues to do so. This bond-buying policy (and not the more publicized federal funds rate) is a major influencer on mortgage rates.

Since June, the Fed has been reducing its balance sheet. Identical sizable reductions occurred monthly through the summer and are being accelerated in September. This is on top of its plan to reduce new bond purchases by an increment every month, the so-called taper, which began in November.

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 November 1-2.

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.