After almost rising back up to 7% last week, the 30-year mortgage average has dropped substantially to start the week, subtracting more than two-tenths of a point.
|National Averages of Lenders' Best Rates|
|FHA 30-Year Fixed||6.93%||7.32%|
|Jumbo 30-Year Fixed||5.90%||5.90%|
Today's National Mortgage Rate Averages
Rates on 30-year loans gave up 22 basis points Monday, dropping last week's average of 6.95% down to 6.73%. Though still elevated, 30-year rates are now 85 basis points cheaper than the 20-year high of 7.58% recorded in mid-October.
The 15-year average also dipped Monday, but by a more modest eighth of a point. Now averaging 6.06%, 15-year rates have declined almost a full percentage point below last month's peak of 7.03%, which was its highest level in 15 years.
The Jumbo 30-year average meanwhile held steady for a fifth market day, remaining Monday at 5.90%. The Jumbo average is currently 37 basis points under the 6.27% reading of late October, which was its most expensive level since 2010.
Refinancing rates moved somewhat similarly Monday compared to new purchase rates. The 30-year refi average dropped a slightly lesser 16 basis points, as did the 15-year average, while Jumbo 30-year refi rates remained flat. The current cost to refinance with a fixed-rate loan is up to 50 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 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|
|FHA 30-Year Fixed||6.93%||-0.14|
|VA 30-Year Fixed||6.89%||-0.18|
|Jumbo 30-Year Fixed||5.90%||No change|
|Jumbo 15-Year Fixed||6.02%||No change|
|Jumbo 7/6 ARM||5.73%||No change|
|Jumbo 5/6 ARM||5.81%||+0.12|
|National Averages of Lenders' Best Rates - Refinance|
|Loan Type||Refinance||Daily Change|
|FHA 30-Year Fixed||7.32%||-0.20|
|VA 30-Year Fixed||7.37%||-0.10|
|Jumbo 30-Year Fixed||5.90%||No change|
|Jumbo 15-Year Fixed||6.03%||No change|
|Jumbo 7/6 ARM||5.81%||No change|
|Jumbo 5/6 ARM||5.82%||+0.12|
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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.
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.