Freddie Mac said the average rate on a 30-year home loan is now 6.09%. Last week it was 6.11%, so there was a slight decline. Last year, the rate hit a 30-year low of 6.06%, according to Yahoo Finance. The average rate for a 15-year home loan also fell. It came down to 5.44% from 5.50% last week.
Sam Khater, chief economist at Freddie Mac, said the economy is strong and many people have jobs. This is helping homes become more affordable. He also said that low loan rates are bringing in more buyers, and more people are applying to buy homes than last year.
Current Mortgage Rates (Latest Data)
Zillow data shows that the national average 30-year fixed mortgage rate is 5.87%, according to Zillow via Yahoo Finance. The 20 year fixed rate is 5.80%. The 15 year fixed rate is 5.44%. Adjustable mortgage rates include 6.01% for the 5/1 ARM and 6.00% for the 7/1 ARM. VA loan rates include 5.36% for a 30-year VA and 4.95% for a 15-year VA. Experts say these numbers are national averages and roundings.
Current Refinance Rates
The 30-year refinance rate is around 6.05%. The 20-year refinance rate is 6.02%. The 15-year refinance rate is 5.52%. Experts say refinance rates are often slightly higher than purchase rates, but not always.
How mortgage rates work
The mortgage interest rate is the fee charged by lenders for borrowing money. Fixed rate mortgages keep the same interest rate for the entire loan term. Adjustable rates mortgages remain fixed for a few years and then change over time. According to Yahoo Finance, in the early years of a mortgage, most of the monthly payments go toward interest. Later, more of the payment goes towards paying off the principal loan amount.
Who controls mortgage rates
Borrowers can get better rates by comparing lenders. Higher credit scores and less debt usually help people get lower rates. A larger down payment can also lower mortgage interest rates. The overall economy strongly influences mortgage rates. When the economy is weak, rates usually fall to encourage borrowing. When the economy is strong, rates usually rise to control spending.
30-Year vs. 15-Year Mortgage
A 30-year home loan has smaller monthly payments. But you pay more total interest over time as the loan lasts longer. The monthly payment for a 15 year home loan is larger. But you pay less total interest because you pay off the loan faster. Experts say a 30-year loan is easier every month, while a 15-year loan saves more money in the long run.
Some banks like Chase and Citibank are currently offering the lowest mortgage rates. Experts say the 2.75% mortgage rate is extremely rare today and was mainly seen during 2020-2021. The lowest 30-year mortgage rate ever recorded was 2.65% in January 2021. Some experts say refinancing makes sense when the new rate is 1-2% lower than your current rate, according to Yahoo Finance.
questions to ask
Q1. Why did mortgage rates go down this week?
Mortgage rates fell slightly as bond yields fell after the market adjusted sharply to the surprise jobs report.
Q2. What is the current average 30-year mortgage rate?
According to Freddie Mac data, the average 30-year fixed mortgage rate is about 6.09%.