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30-Year Mortgage Rates Drop to Lowest Level Since the Summer

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With another rate drop Monday, the 30-year mortgage average has fallen to its lowest level since early August, plunging to 7.44%. Though many other loan averages moved down as well, several remained flat and refi averages included multiple increases.

Because rates vary widely across lenders, it’s always smart to shop around for your best mortgage option and compare rates regularly, no matter what type of loan you’re seeking.

National Averages of Lenders’ Best Rates
Loan Type
New Purchase
Refinance
30-Year Fixed
7.44%
8.25%
FHA 30-Year Fixed
6.93%
7.49%
Jumbo 30-Year Fixed
6.69%
6.69%
15-Year Fixed
6.86%
7.18%
5/6 ARM
7.75%
7.86%
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.

Today’s Mortgage Rate Averages: New Purchase

Rates on 30-year mortgages declined a notable 9 basis points Monday, lowering the flagship average to 7.44%. That’s a drop of 28 basis points over the past week, and takes the average to its lowest mark since Aug. 10. It’s now also a full point below the historic 23-year high average of 8.45% notched on Oct. 17.

Note

Freddie Mac’s Oct. 26 release of weekly mortgage data was historic, indicating that 30-year mortgage rates had climbed to a 7.79% average—the highest level since 2000. But in each of the five weeks since, the Freddie Mac 30-year average has fallen. Last week’s average was down to 7.22%, also the lowest mark since September.

Freddie Mac’s averages differ from those we publish here due to Freddie Mac calculating a weekly average that blends five previous days of rates, which may include loans priced with discount points. In contrast, Investopedia’s averages indicate daily rate movement and only include zero-point loans.

Rates on 15-year new purchase loans held roughly steady Monday, tacking on a single basis point. That leaves the 15-year average at 6.86% and in a range not seen since mid-August. In contrast, October saw 15-year rates surge to a 7.59% peak, its highest average since 2000.

Monday’s jumbo 30-year average was flat after falling substantially Friday. Holding at 6.69%, jumbo 30-year rates are also at their lowest level since August. Though daily historical jumbo rates are not available before 2009, it’s estimated that the 7.52% peak ion October was the most expensive average for jumbo 30-year loans in more than 20 years.

National Averages of Lenders’ Best Rates – New Purchase
Loan Type
New Purchase Rates
Daily Change
30-Year Fixed
7.44%
-0.09
FHA 30-Year Fixed
6.93%
-0.16
VA 30-Year Fixed
6.95%
-0.11
Jumbo 30-Year Fixed
6.69%
No Change
20-Year Fixed
7.14%
-0.04
15-Year Fixed
6.86%
+0.01
FHA 15-Year Fixed
7.05%
-0.02
Jumbo 15-Year Fixed
6.77%
No Change
10-Year Fixed
6.72%
-0.04
10/6 ARM
7.61%
-0.08
7/6 ARM
7.59%
-0.05
Jumbo 7/6 ARM
6.46%
No Change
5/6 ARM
7.75%
+0.04
Jumbo 5/6 ARM
6.44%
-0.13

Today’s Mortgage Rate Averages: Refinancing

Refinancing rates were more of a mixed bag Monday, with the various averages moving up, down, and sideways. For its part, the 30-year refi average climbed 4 basis points, further extending the gap between 30-year new purchase and refi rates to an unusually wide 81 basis points.

The biggest refi movers were the averages for FHA 30-year and jumbo 5/6 adjustable-rate loans, each of which dropped 13 basis points Monday.

National Averages of Lenders’ Best Rates – Refinance
Loan Type
Refinance Rates
Daily Change
30-Year Fixed
8.25%
+0.04
FHA 30-Year Fixed
7.49%
-0.13
VA 30-Year Fixed
7.74%
+0.01
Jumbo 30-Year Fixed
6.69%
No Change
20-Year Fixed
7.69%
-0.02
15-Year Fixed
7.18%
+0.09
FHA 15-Year Fixed
7.29%
+0.08
Jumbo 15-Year Fixed
6.77%
No Change
10-Year Fixed
7.02%
+0.02
10/6 ARM
7.73%
-0.07
7/6 ARM
7.80%
+0.07
Jumbo 7/6 ARM
6.56%
No Change
5/6 ARM
7.86%
-0.01
Jumbo 5/6 ARM
6.43%
-0.13

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

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, while these rates are averages. Teaser rates 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. The mortgage rate you ultimately secure will be based on factors like your credit score, income, and more, so it may be higher or lower than the averages you see here.

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 type, and size, in addition to individual lenders’ varying risk management strategies.

The states with the lowest 30-year new purchase averages were Vermont, Mississippi, Delaware, North Dakota, Iowa, and Louisiana, while the states with the highest averages were Nevada, Arizona, Minnesota, Idaho, Oregon, and Washington.

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, especially 10-year Treasury yields
The Federal Reserve’s current monetary policy, especially as it relates to bond buying and funding government-backed mortgages
Competition between mortgage 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 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 is a major influencer of mortgage rates.

But starting in Nov. 2021, the Fed began tapering its bond purchases downward, making sizable reductions each month until reaching net zero in March 2022.

Since that time, the Fed has been aggressively raising the federal funds rate to fight decades-high inflation. While the fed funds rate can influence mortgage rates, it does not directly do so. In fact, the fed funds rate and mortgage rates can move in opposite directions.

However, given the historic speed and magnitude of the Fed’s 2022 and 2023 rate increases—raising the benchmark rate 5.25 percentage points over the last 18 months—even the indirect influence of the fed funds rate has resulted in an upward impact on mortgage rates over the last two years.

The Fed has opted to hold rates steady at its last two meetings, which concluded Sept. 20 and Nov. 1. Though Fed Chair Jerome Powell made it clear that another rate increase is still possible at a future meeting, encouraging inflation data released Nov. 14 has since dampened almost all expectations of future increases. The Fed’s next rate announcement will be made on Dec. 13.

How We Track Mortgage Rates

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.

Investopedia / Alice Morgan

Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our
editorial policy.

Freddie Mac. “Mortgage Rates.”

Congressional Research Service. “Federal Reserve: Tapering of Asset Purchases,” Page 1.

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