After notching a new 23-year high Friday, 30-year mortgage rates plummeted by more than a third of a percentage point Tuesday. The substantial drop was the biggest single-day decline for the flagship average since Dec. 1, 2022. Rates were also down by double-digit basis points for most other loan types.
The latest 30-year fixed-rate average is 8.00%. Since 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.
Loan Type
New Purchase
Refinance
30-Year Fixed
8.00%
8.41%
FHA 30-Year Fixed
7.79%
8.19%
Jumbo 30-Year Fixed
7.27%
7.27%
15-Year Fixed
7.47%
7.55%
5/6 ARM
7.64%
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
After spiking 20 basis points Friday to reach a new historic peak of 8.34%, 30-year mortgage rates fell sharply Tuesday. (Monday was a federal holiday with no reported rate data.) The 30-year average plunged 34 basis points to land at 8.00%, its lowest mark in over a week.
Note
Freddie Mac released its latest weekly mortgage average Thursday, revealing that 30-year rates had hit a new 23-year high. The new Freddie Mac average is 7.49%, its highest level since late 2000.
Freddie Mac’s averages differ from the averages we publish here due to Freddie Mac calculating a weekly average that blends five previous days of rates, and 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 loans meanwhile saw a modest dip, subtracting just 5 basis points Tuesday. Now down to 7.47%, the 15-year average is slightly below its recent peak of 7.54%, a high-water mark since 2001.
After jumping 13 basis points Friday, jumbo 30-year rates dropped back down by the same 13 points Tuesday, returning the average to 7.27%. Though daily jumbo averages are not available before 2009, it’s estimated the recent peak of 7.40% was the most expensive level for jumbo 30-year loans in more than 20 years.
Averages for jumbo 15-year and jumbo 5/6 ARM loans were the only averages that didn’t decline Tuesday, with both remaining flat for a second day.
Loan Type
New Purchase Rates
Daily Change
30-Year Fixed
8.00%
-0.34
FHA 30-Year Fixed
7.79%
-0.26
VA 30-Year Fixed
7.80%
-0.27
Jumbo 30-Year Fixed
7.27%
-0.13
20-Year Fixed
7.95%
-0.37
15-Year Fixed
7.47%
-0.05
FHA 15-Year Fixed
7.37%
-0.06
Jumbo 15-Year Fixed
7.27%
No Change
10-Year Fixed
7.34%
-0.15
10/6 ARM
7.84%
-0.32
7/6 ARM
7.70%
-0.09
Jumbo 7/6 ARM
7.08%
-0.13
5/6 ARM
7.64%
-0.03
Jumbo 5/6 ARM
7.19%
No Change
Today’s Mortgage Rate Averages: Refinancing
Refinancing rates for 30-year loans also dropped substantially Tuesday, but by a less dramatic 17 basis points. That stretches the gap between 30-year refi and new purchase rates to 41 basis points.
Tuesday’s refinancing rates for 15-year loans dipped 8 basis points, and jumbo 30-year loans, 13 basis points—both similar to the declines in their new purchase siblings. All other refi averages were down as well, with the exception of flat averages on jumbo 15-year and jumbo 5/6 ARM loans.
Loan Type
Refinance Rates
Daily Change
30-Year Fixed
8.41%
-0.17
FHA 30-Year Fixed
8.19%
-0.10
VA 30-Year Fixed
8.00%
-0.19
Jumbo 30-Year Fixed
7.27%
-0.13
20-Year Fixed
8.33%
-0.25
15-Year Fixed
7.55%
-0.08
FHA 15-Year Fixed
7.42%
-0.13
Jumbo 15-Year Fixed
7.27%
No Change
10-Year Fixed
7.49%
-0.09
10/6 ARM
8.07%
-0.10
7/6 ARM
7.93%
-0.07
Jumbo 7/6 ARM
7.19%
-0.12
5/6 ARM
7.86%
-0.05
Jumbo 5/6 ARM
7.19%
No Change
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 Friday were Vermont, Delaware, North Dakota, Mississippi, and Wisconsin, while the states with the highest averages were Idaho, Arizona, Washington, and Georgia.
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 a cumulative 5.25% 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 two more rate-setting meetings scheduled in 2023, concluding Nov. 1 and Dec. 13. Though it’s too soon to reliably predict the central bank’s next move, Fed Chair Jerome Powell has made it clear that another rate increase is certainly possible at either meeting.
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.
Investopedia / Alice Morgan
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