For the past week, mortgage rates have seen tiny movements in both directions, keeping them within a narrow range just slightly above 3%. They have now been hovering within an eighth of a point above 3% since the first week of August.
Today’s National Mortgage Rate Averages
In keeping with their recent pattern of micro movements, mortgage rates dipped ever so slightly Wednesday, with the 30-year fixed rate dropping a single basis point. For more than a month, the flagship rate has yo-yo’d between 3.00% and 3.13%. It ended Wednesday at 3.06%, a 17-point premium above the five-month low of 2.89% set on August 3.
Meanwhile, the average on Jumbo 30-year fixed rates marked time at 3.15%, while the 15-year fixed average shed three basis point to 2.31%. Both averages are currently within a tenth of a point of the lows seen early last month.
Refinance rates averaged 10 to 18 basis points higher than new purchase rates on fixed-rate loans, while 5/1 ARM refinancing currently carries a premium of 43 points over new purchase ARMs. Notably, the average Jumbo 30-year refinance rate is only three points above its lowest level since February.
Important:
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.
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.
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.