Mortgage rates continue to rise

National Averages of Lenders’ Best Interest Rates – New Purchase
Loan type	New purchase prices	Daily change
30 year fixed term	6.23%	+0.05
FHA 30 year company	5.39%	No change
VA fixed for 30 years	5.47%	-0.04
20 year fix	5.95%	+0.02
15 year fixed term	5.11%	+0.02
FHA fixed for 15 years	4.92%	No change
10 year fix	4.95%	No change
7/6 ARM	7.33%	-0.03
5/6 ARM	7.48%	+0.08
Jumbo fixed for 30 years	6.39%	-0.05
Jumbo fixed for 15 years	6.55%	-0.03
Jumbo 7/6 ARM	7.28%	-0.13
Jumbo 5/6 ARM	7.45%	+0.01
Delivered via the Zillow Mortgage API

The Freddie Mac weekly average

Every Thursday, Freddie Mac, a government-sponsored buyer of mortgage loans, releases a weekly average of 30-year mortgage rates. Last week’s reading fell 1 basis point to 6.08% – the lowest weekly average since September 2022. Freddie Mac’s average reached a historic 23-year high of 7.79% last October.

Freddie Mac’s average differs from what we report for 30-year rates because Freddie Mac charges one weekly Average that mixes the rates from five previous days. In contrast, our 30-year average from Investopedia is a daily value, providing a more precise and timely indicator of interest rate movement. Additionally, criteria for included loans (e.g., down payment size, credit score, inclusion of discount points) vary between Freddie Mac’s methodology and our own.

Use our mortgage calculator to calculate monthly payments for various loan scenarios.

What causes mortgage rates to rise or fall?

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

Because any number of these factors can cause fluctuations at the same time, it is generally difficult to attribute the change to a single factor.

Macroeconomic factors kept the mortgage market relatively depressed for much of 2021. In particular, the Federal Reserve had bought billions worth of bonds in response to the economic pressure of the pandemic. This bond purchasing policy has a major impact on mortgage interest rates.

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

Between then and July 2023, the Fed aggressively raised interest rates to combat decades of inflation. While the fed funds rate can influence mortgage interest rates, it does not have a direct impact on them. In fact, the prime rate and mortgage rates can move in opposite directions.

But given the historic speed and magnitude of the Fed’s rate hikes in 2022 and 2023 – which increased the federal funds rate by 5.25 percentage points in 16 months – even the indirect impact of the Fed funds rate has become dramatic in the last two months Rise in mortgage interest rates led years.

The Fed kept the key interest rate at its peak for almost 14 months starting in July 2023. But on September 18, the central bank announced the first rate cut in a series of cuts in 2024 and likely 2025. This first reduction was 0.50 percentage points.

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

How We Track Mortgage Rates

The above national and state averages are provided as is via the Zillow Mortgage API, assuming an 80% loan-to-value ratio (LTV) (i.e. a down payment of at least 20%) and an applicant credit score range of 680-739. The resulting interest rates represent what borrowers should expect when receiving offers from lenders based on their qualifications, which may differ from the advertised teaser interest rates. © Zillow, Inc., 2024. Use subject to Zillow Terms of Service.