Having climbed for nearly two weeks already, 30-year mortgage rates surged higher Thursday—triggered by Wednesday's Federal Reserve announcement of a scaled-back forecast for 2025 rate cuts. Jumping to 6.98%, the 30-year mortgage average is now at its most expensive level in more than five months. Rate movement for other mortgage types was meanwhile mixed.

Since rates vary widely across lenders, it's always smart to shop around for your best mortgage rate and compare rates regularly, no matter the type of home loan you seek.

Today's New Purchase Mortgage Rate Averages

On Wednesday's news that the Fed is expecting to make fewer rate cuts in 2024 than previously projected, 30-year mortgage rates shot up a sizable 13 basis points Thursday. That pushes the average to 6.98%—its highest reading since July 3. Rates had sunk to a two-year low of 5.89% back in September, but they've soared almost 1.1 percentage points higher over the past three months.

Looking further back, however, 30-year mortgage rates remain well below an April peak of 7.37%. And they're more than a percentage point cheaper than the historic 23-year peak of 8.01% reached in October 2023.

Rates on 15-year mortgages added 11 basis points Thursday, reaching a 6.12% average that is the highest reading in a month. Like their 30-year counterparts, 15-year rates dropped to a two-year low in September, sinking as far as 4.97%. Though today's 15-year average is elevated, it remains almost a percentage point below last fall's historic 7.08% reading—a high since 2000.

Jumbo 30-year mortgage rates tacked on a smaller 7 basis points, bringing the Thursday average to 6.90%. In September, jumbo 30-year rates had sunk to 6.24%, their cheapest average in 19 months. Although daily historical jumbo rates weren't published before 2009, it's estimated that the 8.14% peak we saw in October 2023 was the most expensive jumbo 30-year average in 20-plus years.

The Weekly Freddie Mac Average

Every Thursday, Freddie Mac, a government-sponsored buyer of mortgage loans, publishes a weekly average of 30-year mortgage rates. This week's reading jumped 12 basis points to a weekly average of 6.72%. As recently as Sept. 26, the average had sunk as far as 6.08%. Back in October 2023, however, Freddie Mac's average saw a historic rise, surging to a 23-year peak of 7.79%.

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.

Calculate monthly payments for different loan scenarios with our 澳洲幸运5官方开奖结果体彩网:Mortgage Calculator.

What Causes Mortgage Rates to Rise or Fall?

Mortgage rates are determined by a c꧒omplex interaction 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 any number of these can cause fluctuations simultaneously, 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-high inflation. While the fed funds rate can influence mortgage rates, it doesn't directly 🐈do so. In fact, t⛎he 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 maintained the federal funds rate at its peak level for almost 14 months, beginning in July 2023. But on Sept. 18, the central bank 澳洲幸运5官方开奖结果体彩网:announced a first rate cut of 0.50 percentage points, and then followed that with quarter-point reductions on Nov. 7 and Dec. 18.

However, the Fed's policy committee cautioned at its meeting this week that, due to stubborn inflation, further rate cuts may be fewer and farther between. This scaled-back forecast for 2025 reductions has pushed 10-year Treasury yields higher, which in turn has triggered a mortgage rate rise.

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.