Mortgage rates hold near 3-month high

National Average Best Lender Rates – New Buy
Loan type	New purchase prices	Daily change
30 year fixed	6.76%	No changes
FHA 30 year fixed term	5.39%	No changes
VA, 30 year fixed term	6.25%	-0.02
20 year fixed	6.70%	+0.02
15 year fixed	5.90%	-0.02
FHA Fixed Term 15 Years	4.92%	No changes
10 year fixed	6.09%	+0.18
7/6 HAND	7.36%	-0.01
5/6 HAND	7.55%	-0.01
Large fixed term of 30 years	6.79%	-0.04
Large fixed term of 15 years	6.81%	-0.02
Jumbo 7/6 ARM	7.26%	-0.02
Jumbo 5/6 ARM	7.33%	-0.02
Provided via Zillow Mortgage API

Freddie Mac Weekly Average

Every Thursday, Freddie Mac, the government-sponsored buyer of mortgages, releases average weekly rates on 30-year mortgages. Last week’s rate rose another 10 basis points to 6.54%, while the 6.08% rate four weeks ago was the lowest average since September 2022. Last October, Freddie Mac’s average rose to an all-time 23-year high of 7.79%.

Freddie Mac’s average differs from what we report for 30-year rates because Freddie Mac calculates weekly an average combining rates over the previous five days. In contrast, our Investopedia 30-year average is a daily value, offering a more accurate and timely indicator of rate movements. Additionally, loan inclusion criteria (e.g., down payment amount, credit score, inclusion of discount points) vary between Freddie Mac’s methodology and our own.

Calculate monthly payments for different loan scenarios using our Mortgage calculator.

What causes mortgage rates to rise or fall?

Mortgage rates are determined by a complex interaction of macroeconomic and industry factors, such as:

Since any number of them can cause fluctuations at the same time, it is usually difficult to attribute the change to any one factor.

Macroeconomic factors have kept the mortgage market relatively low for much of 2021. Specifically, the Federal Reserve has been buying billions of dollars of bonds in response to the economic pressures of the pandemic. This bond purchase policy is a major factor influencing mortgage rates.

But starting in November 2021, the Fed began tapering bond purchases, making significant cuts each month until it reached net zero in March 2022.

From then until July 2023, the Fed aggressively raised rates. federal funds rate to combat inflation, which has been at high levels for decades. While the federal funds rate can influence mortgage rates, it does not directly affect them. In fact, the federal funds rate and mortgage rates may be moving in opposite directions.

But given the historical speed and size of the Fed’s rate hikes in 2022 and 2023 (raising the benchmark rate by 5.25 percentage points over 16 months), even the indirect impact of the fed funds rate has led to sharp increases in mortgage rates over the past two years. years.

The Fed kept the federal funds rate at its peak level for nearly 14 months, starting in July 2023. announced the first rate cut A series of cuts are expected in 2024 and likely 2025. This first decline was 0.50 percentage points.

The Fed’s next rate announcement will be made on November 7th.

How we track mortgage rates

The national and state averages above are provided unchanged through the Zillow Mortgage API, provided that loan to value (LTV) ratio 80% (i.e. a down payment of at least 20%) and the applicant’s credit score in the range of 680–739. The rates received represent what borrowers should expect when receiving quotes from lenders based on their qualifications, which may differ from advertised rates. © 2024 Zillow, Inc. Use subject to Zillow’s Terms of Use.