Editor's note: Portions of this article have been auto-populated using data from mortgage research firm Curinos, which collects data from more than 250 lenders. For more information on how we compile our daily mortgage data, see our methodology here.
Mortgage rates are holding steady. According to Curinos data analyzed by the MarketWatch Guides team, the current 30-year fixed rate is holding steady at 7.30% APR, while the 15-year fixed rate is holding steady at 6.68% APR.
New home construction is being impacted by persistently high mortgage rates. According to the U.S. Census Bureau and the Department of Housing and Urban Development (HUD), new home sales fell sharply in May, dropping 11.3% from April. This is a 16.5% decrease from May 2023.
Homebuilders' confidence in the housing market is at its lowest level since December, according to the National Association of Home Builders/Wells Fargo Housing Market Index, which found that 29% of homebuilders have lowered home prices to attract potential buyers.
The Census Bureau and Department of Housing and Urban Development reported that builders started construction on 19.3% fewer homes and apartments in May than they did a year ago. The NAHB quoted Chairman Carl Harris, a custom home builder in Wichita, Kansas, as saying, “Staying high mortgage rates are putting many potential buyers off making a purchase. Homebuilders are also dealing with rising interest rates on construction and development loans, a chronic labor shortage and a shortage of buildable land.”
Current average mortgage interest rates are:
30-Year Fixed Mortgage Rates: 7.30% 15-Year Fixed Mortgage Rates: 6.68% 5/6 ARM Mortgage Rates: 7.06% Jumbo Mortgage Rates: 7.17%
Current mortgage interest rates
Product Rate Changes Last Week 30 Year Fixed Rate 7.30% 7.30% 0.0015 Year Fixed Rate 6.68% 6.68% 0.005/6 ARM 7.06% 7.06% 0.007/6 ARM 7.14% 7.14% 0.0010/6 ARM 7.27% 7.27% 0.0030 Year Fixed Rate Jumbo 7.17% 7.17% 0.0030 Year Fixed Rate FHA 6.96% 6.96% 0.0030 Year Fixed Rate VA 7.01% 7.01% 0.00
Disclaimer: The above pricing is based on data from Curinos, LLC. All pricing data accurate as of Thursday, July 4, 2024. Actual pricing may vary.
>> See past mortgage interest rate trends
Mortgage interest rates for buying a home
30 year fixed rate mortgages are stable at 0.00
The average interest rate on a 30-year fixed mortgage is 7.30%. Rates have remained stable since the same time last week, a change of 0.00 percentage points.
At today's average interest rate, you'll pay $685.57 per month in principal and interest for every $100,000 you borrow. That's the same payment as last week, when the average interest rate was 7.30%.
15 year fixed rate mortgages are stable at 0.00
The average interest rate on a 15-year fixed mortgage is 6.68%, remaining flat 0.00 percentage points compared to last week.
If you take out a 15-year fixed mortgage with a 6.68% interest rate, your monthly payment will be about $881.03 per $100,000 borrowed. If your interest rate was 6.68% last week, you would have been paying $881.03 each month.
5/6 Adjustable Rate Mortgages are Stable, 0.00
5/6 The average interest rate on an adjustable rate mortgage is 7.06%, remaining stable at 0.00 percentage points over the past seven days.
An adjustable-rate mortgage (also known as an ARM) is a mortgage that has a fixed interest rate for a set period of time and then adjusts the interest rate periodically. For a 5/6 ARM, your interest rate will be fixed for the first five years and then adjust every six months for the next 25 years.
With a 5/6 ARM interest rate of 7.06%, your monthly payments for the first five years of the loan will be approximately $669.34 per $100,000 borrowed.
Jumbo loan interest rates are stable at 0.00
The average jumbo mortgage rate today is 7.17%, remaining flat 0.00 percentage points compared to the past week.
A jumbo loan is a mortgage that exceeds the loan limits set by the Federal Housing Finance Administration (FHFA) and the lending standards of Freddie Mac and Fannie Mae. This typically means the amount borrowed is more than $726,200.
Monthly P&I per $100,000 of product Last week change30 year fixed$685.57$685.57$0.0015 year fixed$881.03$881.03$0.005/6 ARM$669.34$669.34$0.007/6 ARM$674.73$674.73$0.0010/6 ARM$683.53$683.53$0.0030 year fixed jumbo$676.76$676.76$0.0030 year fixed FHA$662.62$662.62$0.0030 year fixed VA$665.97$665.97$0.00
Note: Monthly payment amounts for adjustable rate mortgages are shown for the first 5, 7, and 10 years of the loan, respectively.
Factors that affect mortgage interest rates
Mortgage interest rates change frequently depending on the economic environment. Inflation, the federal funds rate, housing market conditions, and other factors all affect how interest rates fluctuate from week to week and month to month.
But beyond macroeconomic trends, several factors specific to the borrower also affect mortgage interest rates. These include:
Financial situation: Mortgage lenders look at a borrower's past financial decisions to assess the risk of lending to them. Loan amount and structure: The amount a bank or mortgage lender will lend and its structure (including both the term and whether it's a fixed or adjustable rate). Location: Mortgage interest rates vary depending on where you're buying a home. Areas with more lenders and more competition are likely to have lower interest rates. Foreclosure laws also affect the lender's risk and will affect the interest rate. Whether the borrower is a first-time home buyer: First-time home buyer programs often offer lower interest rates to new homeowners. Lender: Banks, credit unions, and online lenders may all offer slightly different interest rates based on their internal judgment.
How to Choose the Best Mortgage Rate
Comparison shopping for a mortgage can be a daunting task, but it's worth the effort. A recent study from Freddie Mac found that homeowners could save $600 to $1,200 a year by comparison shopping for the best rates. Here are some steps to help you find the best mortgage rates.
1. Check your credit score and credit report
A borrower's credit history will likely determine the type of mortgage and interest rate they can get: Conventional loans are usually only offered to borrowers with credit scores of 620 or higher, while FHA loans may be the best option for borrowers with FICO scores between 500 and 619. Additionally, individuals with higher credit scores are more likely to be offered lower mortgage interest rates.
Mortgage lenders frequently check your scores from the three major credit bureaus: Equifax, Experian, and TransUnion. Checking your score before a lender considers you for a loan not only lets them make sure there aren't any mistakes, but it also gives you the opportunity to improve your score by paying down balances or limiting new credit cards or loans.
2. Know your options
There are four standard mortgage programs: conventional, FHA, VA, and USDA. To get the best mortgage rate and increase your chances of approval, it's important for potential borrowers to do their research and apply for the mortgage program that best suits their financial situation.
The table below describes each program and highlights minimum credit score and down payment requirements.
Conventional mortgages are the most common, but borrowers must also consider the repayment plan and term. Interest rates can be either fixed or variable, and terms can range from 10 to 30 years, although most homeowners choose a 15- or 30-year mortgage.
3. Compare quotes from multiple lenders
Searching for a mortgage requires more than comparing interest rates online. It's a good idea to contact lenders directly to find out the “real” interest rate, as the numbers quoted online may not reflect a borrower's specific situation. There's no limit to the number of mortgage companies you can apply to, although most experts recommend getting quotes from three to five lenders. Lenders often allow borrowers to get pre-qualified for a mortgage and receive a tentative loan offer without affecting their credit score.
After gathering loan documents, including proof of income, assets, and credit, borrowers can also apply for pre-approval, which gives them an idea of their standing with lenders and may also give them more negotiating power with home sellers.
4. Check your loan estimate
To get a full idea of which lender is offering the cheapest loan overall, check the Loan Estimate provided by each lender. The Loan Estimate will list not only the mortgage interest rate but also the borrower's Annual Percentage Rate (APR), which includes the interest rate and the lender's other fees, such as closing costs and discount points.
Comparing loan quotes between lenders allows borrowers to see a full breakdown of possible costs. One lender may have a low interest rate but high fees, or vice versa. Checking the loan APR allows for an accurate comparison between lenders that takes into account both interest rates and fees.
5. Consider negotiating interest rates with your lender
Mortgage lenders want to do business, which means borrowers will likely use competing offers as a bargaining chip to adjust their fees and interest rates. While many lenders may not lower their asking rate by much, even a few basis points could save a borrower more than they think in the long run. For example, the difference between 6.8% and 7.0% on a 30-year fixed-rate $100,000 mortgage would amount to roughly $5,000 over the life of the loan.
Expert predictions for mortgage rates
Mortgage rates have fallen significantly over the past few months. The 30-year fixed rate mortgage hit 8% last October, but is now closer to 7% by the end of 2023. In fact, it averaged 7.3% in the fourth quarter of 2023.
Analysts from Fannie Mae and the Mortgage Bankers Association both predict rates will fall from 2024 through next year.
Fannie Mae economists expect rates to fall more rapidly, to below 6% by the fourth quarter of 2024, compared with 6.1% for the fourth quarter of 2024 and 5.9% for the first quarter of 2025, according to the MBA.
Other Mortgage Resources
methodology
Every weekday, MarketWatch Guides provides readers with the latest interest rates on 11 mortgage loans. These daily average data are provided by Curinos, LLC, a leading provider of mortgage research that collects data from more than 250 lenders. For more information on how we compile our daily mortgage data, see our comprehensive methodology here. Editor's Note: Before making any major financial decisions, consider discussing your options with someone you trust, such as a financial advisor, credit counselor or financial professional, as everyone's circumstances and needs are different.