The 30-year mortgage rate average climbed higher Tuesday, to 6.40%. That's after a seven-day decline plunged the average to its lowest level since spring 2023. Averages for most other mortgage rates also rose Tuesday.

Because rates vary widely across lenders, it's always smart to shop around for 澳洲幸运5官方开奖结果体彩网:your best mortgage option and compare rates regula🌄rly, no matter 𒐪the type of home loan you seek.

Today's New Purchase Mortgage Rate Averages

Rates on 30-year new purchase mortgages climbed 12 basis points Tuesday, raising the flagship average to 6.40%. The previous day's reading of 6.28% was the cheapest average since April 2023, representing a dramatic drop of 80 basis points across July. Current rates are well below the historic 23-year high of 8.01% reached last October.

Rates on 15-year mortgages added 18 basis points Tuesday, boosting the average to 5.50%. That's after sliding Monday to 5.32%, the lowest 15-year reading since February 2023. The current average is far below last fall's historic 7.08% peak—a high-water mark since 2000.

Jumbo 30-year rates also climbed, tacking on 11 basis points to a new average of 6.91%. That's still well under this spring's high of 7.30%. Although daily historical jumbo rates were not published before 2009, it's estimated the 8.14% peak reached last fall was the most expensive jumbo 30-year average in 20-plus years.

The Weekly Freddie Mac Average

Every Thursday, Freddie Mac, a government-sponsored enterprise that purchases mortgage loans, publishes a weekly average of 30-year mortgage rates. Last week's reading slid 5 basis points to 6.73%. Freddie Mac's average reached a historic 23-year peak of 7.79% in October. It later dropped significantly, registering a low point of 6.60% in mid-January.

Freddie Mac’s average differs from what we report for 30-year rates because Freddie Mac calculates a weekly average that blends five previous days of rates. In contrast, our Investopedia 30-year average is a daily reading, offering a more precise and timely indicator of rate movement. In addition, the criteria for included loans (e.g., amount of down payment, credit score, inclusion of discount points) varies between Freddie Mac's methodology and our own.

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What Causes Mortgage Rates to Rise or Fall?

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

• The level and direction of the bond market, especially 10-year Treasury yields
• The Federal Reserve's current monetary policy, especially as it relates to bond buying and funding government-backed mortgages
• 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 澳洲幸运5官方开奖结果体彩网:bond-buying policy is a major influencer of 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.

Between that time and July 2023, the Fed aggressively raised the 澳洲幸运5官方开奖结果体彩网:federal funds rate to fight decades-h♐igh inflation. While the fed funds rate can influence mortgage rates, it doesn't directly do so. In fact, the fed funds rate and mortgage rates can move in opposite directions.

But given the historic speed and magnitude of the Fed's 2022 and 2023 rate increases—raising the benchmark rate 5.25 percentage points over 16 months—even the indirect influence of the fed funds rate has resulted in a dramatic upward impact on mortgage rates over the last two years.

The Fed has been maintaining the federal funds rate at its current level since last July, with an 澳洲幸运5官方开奖结果体彩网:eighth consecutiv𒉰e rate hold announced on July 31. Although inflation has come down considerably, it's still above the Fed's target level of 2%. Until the central bank f♒eel𝔍s confident inflation is falling sufficiently and sustainably, it has said it's hesitant to start cutting rates.

The Fed will hold three more meetings this year, with the next one scheduled to conclude Sept. 18.

How We Track Mortgage Rates

The national and state averages cited above are provided as is via the Zillow Mortgage API, assuming a 澳洲幸运5官方开奖结果体彩网:loan-to-value (LTV) ratio of 80% (i.e., a down payment of at least 20%) and an applicant credit score in the 680–739 range. The resulting rates represent what borrowers should expect when receiving quotes🐻 from lenders based on their qualifications, which may vary from advertised teaser rates. © Zillow, Inc., 2024. Use is subject to the Zillow Terms of Use.