Mortgage Rates Climb for a Second Day

Rates on 30-year mortgages rose for a second day Monday, accumulating an eighth of a point gain over last week's low point. Most other averages also moved up, though jumbo rates were flat. The only rates to dip Monday were the 7/6 and 5/6 ARM averages.

It's always wise to shop around for your best mortgage option, so be sure to compare rates regularly, no matter what type of mortgage you're in the market for.

Today's National Mortgage Rate Averages

Thirty-year mortgage rates added a second day of increases Monday, cementing the end of what had been a dramatic five-day rate decline. Rising 8 basis points Monday to reach 7.29%, the 30-year average is now up an eighth of a point from last week's low point. Rates on 30-year loans have swung wildly this month, first surging to a 7.70% average, which is estimated to be 20-year high, and then sinking more than a half percentage point to 7.17% last week.

Rates on 15-year mortgages also climbed Monday, tacking on another tenth of a point to reach 6.55%. Like 30-year rates, the 15-year average sits an eighth of a point above last week's low, but considerably below the estimated 15-year high of 7.11% reached on July 6.

All four jumbo rate averages remained steady Monday, with the jumbo 30-year average holding at 6.52%. Several times in the last two weeks, the jumbo 30-year average has registered 6.65%, which is estimated to be the highest Jumbo 30-year average since at least 2009.

The only rate averages showing a decline Monday were for 5/6 ARM and 7/6 ARM loans, with the averages dipping 1 and 7 basis points, respectively.

Refinancing rates moved somewhat similarly to new purchase rates Monday, though the 30-year refi average climbed a much bolder 16 basis points. For their part, the 15-year refi average gained 8 basis points and the jumbo 30-year refi average marked time. The gap between 30-year new purchase and refi rates was 35 basis points Monday.

After a historical rate plunge in August 2021—which lowered the 30-year average to a remarkable 2.89%—mortgage rates have skyrocketed over the last two years. Major surges were seen in June 2022, October 2022, May 2023, and now July 2023, with the most recent peak for 30-year rates taking the average to what's considered to be a 20-year high. However, it's difficult to nail down precisely how far back we'd have to go to find rates this high, since daily rate averages weren't published before 2009.

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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 type, 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 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 on mortgage rates.

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

The federal funds rate, which is set every six to eight weeks by the Fed's rate and policy committee—the Federal Open Market Committee (FOMC)—can also influence mortgage rates. However, it does not directly drive mortgage rates, and in fact, the fed funds rate and mortgage rates can move in opposite directions.

At its latest meeting, which concluded on June 14, the Fed paused rate hikes, keeping the fed funds rate at the current range of 5.00% to 5.25%. This was the first meeting in 15 months in which the Fed did not raise its benchmark rate. It is widely expected that the Fed will make another quarter-point increase at its meeting concluding July 26, though financial markets are currently betting that will be its last rate increase this year.

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.