Mortgage rates dropped Wednesday, continuing a yo-yo pattern over the past week. Though averages are slightly elevated above five-month lows set in early August, rates are still historically low, with the 30-year average sitting just above 3%.
|National Averages of Lenders’ Best Rates|
|FHA 30-Year Fixed||2.88%||3.02%|
|Jumbo 30-Year Fixed||3.12%||3.33%|
Today’s National Mortgage Rate Averages
After recently sinking to their lowest levels since early February, mortgage rates have climbed back up, though they’ve spent the past week bouncing around. The 30-year fixed-rate average edged four points downward Thursday, to 3.03%. That’s 14 points above the five-month low of 2.89% set August 3.
Averages on 15-year and Jumbo 30-year fixed-rate loans also dipped, sinking five points to 2.29% for 15-year mortgages, and three points to 3.12% on Jumbo 30-year loans. That brings both averages within six to eight basis points of the five-month lows set earlier in the month.
Refinance rates averaged 12 to 21 basis points higher than new purchase rates on fixed-rate loans, while 5/1 ARM refinancing currently carries a premium of 36 points over new purchase rates. Notably, the average on Jumbo 30-year refinanced loans is just three points above its lowest level since February.
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 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|
|Loan Type||New Purchase||Daily Change|
|FHA 30-Year Fixed||2.88%||-0.05|
|VA 30-Year Fixed||2.90%||-0.04|
|Jumbo 30-Year Fixed||3.12%||-0.03|
|Jumbo 15-Year Fixed||2.85%||-0.01|
|10/1 ARM||2.36%||No Change|
|Jumbo 7/1 ARM||2.16%||No Change|
|Jumbo 7/6 ARM||2.40%||No Change|
|5/1 ARM||2.17%||No Change|
|Jumbo 5/1 ARM||2.01%||No Change|
|Jumbo 5/6 ARM||2.44%||No Change|
|National Averages of Lenders’ Best Rates – Refinancing|
|Loan Type||Refinance||Daily Change|
|FHA 30-Year Fixed||3.02%||-0.05|
|VA 30-Year Fixed||3.10%||-0.07|
|Jumbo 30-Year Fixed||3.33%||+0.02|
|Jumbo 15-Year Fixed||3.02%||No Change|
|Jumbo 7/1 ARM||2.38%||No Change|
|Jumbo 7/6 ARM||2.60%||No Change|
|5/1 ARM||2.53%||No Change|
|Jumbo 5/1 ARM||2.23%||No Change|
|Jumbo 5/6 ARM||2.54%||No Change|
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, as well as individual lenders’ varying risk management strategies.
These rates are surveyed directly from over 200 top lenders.
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 the last several months. In particular, the Federal Reserve has been buying billions of dollars of bonds and continues to do so. This bond-buying policy (and not the more publicized federal funds rate) is a major influencer on mortgage rates.
But Fed policy could soon change. The Fed’s rate and policy committee, called the Federal Open Market Committee (FOMC), meets every 6-8 weeks, and concluded their latest meeting July 28. The detailed minutes of that meeting were released August 18, and though they are not yet announcing a change to their bond-buying plans, a majority of Fed members indicated they favor beginning to taper the stimulus by the end of 2021.
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.