Mortgage rates had a quiet day Monday, with most averages dipping just slightly lower or remaining flat. It follows a week-and-a-half period of dramatic up and down swings for the 30-year average.
Today’s National Mortgage Rate Averages
The 30-year average took a relative breather Monday, with only its second day in 12 registering a minimal move. The flagship average has swung wildly between 5.26% and 5.82% since August 3, but Monday declined a minor three basis points to 5.55%. At its current level, the average is sitting 83 basis points below the 14-year peak of 6.38% it notched in mid-June.
The 15-year average also dropped three basis points Monday, resting again below the 5% mark at 4.97%. Like 30-year loans, 15-year rates reached their highest level since 2008 two months ago, when they touched 5.41%.
Jumbo 30-year rates meanwhile held steady Monday, remaining flat for a sixth day at 4.94%. The Jumbo 30-year average has been sitting below the 5% threshold for more than three weeks.
Refinancing rates for 30-year loans moved slightly up instead, adding five basis points, while the 15-year refi average moved down three points and the Jumbo 30-year average remained flat for another day. The cost to refinance with a fixed-rate loan is currently nine to 55 points more expensive than a new purchase loan.
After a major rate dip last summer, mortgage rates skyrocketed in the first half of 2022, with the 30-year average peaking in mid-June by an eye-popping 3.49 percentage points above its August 2021 low of 2.89%.
Meanwhile, mid-June saw the 15-year and Jumbo 30-year averages shoot 3.21 and 2.38 percentage points higher, respectively, than their summer 2021 valleys.
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 they 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.
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, 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 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 much of this year. In particular, the Federal Reserve has been buying billions of dollars of bonds in response to the pandemic’s economic pressures, and it continues to do so. This bond-buying policy (and not the more publicized federal funds rate) is a major influencer on mortgage rates.
On May 4, the Fed announced that it will begin reducing its balance sheet on June 1. Identical sizable reductions will occur in June, July, and August and then be doubled beginning in September. This will be on top of its existing move to reduce new bond purchases by an increment every month, the so-called taper, which began in November.
The Fed’s rate and policy committee, called the Federal Open Market Committee (FOMC), meets every six to eight weeks. Their next scheduled meeting takes place September 20–21.
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.