30-Year Mortgage Rates Fall Again, Sink to Three-Week Low

Rates on 30-year fixed-rate mortgages dropped for a third day Wednesday, reducing the average to its lowest point in three weeks. Declines were seen almost across the board, with most loan types registering a double-digit decline.

The latest 30-year fixed-rate average is 7.48%. Because 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.

Today's Mortgage Rate Averages: New Purchase

The 30-year mortgage average dropped a bold 14 basis points Wednesday, building a three-day decline of 25 points. Now down to 7.48%, the flagship average has lowered almost a third of a percentage point since registering 7.80% last Tuesday. That historic peak was the highest 30-year average in 22 years.

Rates on 15-year loans dropped similarly, with the average losing 17 basis points Wednesday after holding roughly steady the previous two days. Now down to 6.97%, the 15-year average is two-tenths of a percentage point below the 21-year high of 7.17% it recorded last Tuesday.

Jumbo 30-year rates meanwhile marked time Wednesday, holding at 6.77%. Daily jumbo averages are not available from any source before 2009, but it's fair to assume last week's peak of 7.02% was also the highest level seen in 20-plus years.

No loan averages climbed Wednesday, though in addition to the jumbo 30-year average, rates on 5/6 ARM and jumbo 7/6 ARM loans were essentially flat.

Today's Mortgage Rate Averages: Refinancing

Wednesday's refinancing rates moved generally in line with their new purchase cousins, with the 30-year refi average shedding 13 basis points. That results in a current gap of 36 basis points between 30-year new purchase and refi rates. Unlike the larger move of the new purchase average, the 15-year refi average dipped a modest 6 basis points, while the jumbo 30-year refi average held steady like its new purchase counterpart.

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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 July 26, the Fed hiked rates by a widely expected 25 basis points, raising the fed funds rate to a range of 5.25% to 5.50%. Fed Chairman Jerome Powell said that because inflation is still above the Fed's target rate of 2%, the rate-setting committee could either raise rates again or pause when it meets on Sept. 20, depending on economic conditions.

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.