Today's mortgage rates
Average mortgage rates rose slightly yesterday. It's been a quiet week overall. Sure, these rates are a bit higher than they were seven days ago. But week-to-week changes don't usually get as much attention as daily increases. So don't panic.
Mortgage rates are once again unpredictable next week. The monthly employment report is due out on Friday, but that may cause rates to plummet or spike. Unfortunately, I don't know what that means.
Find and lock in a low interest rate
Current Mortgage and Refinance Rates
Program Mortgage Rate APR* Change 5/1 ARM Regular Rate 6.588% 7.959% +0.12 Regular Rate 15 Year Fixed Rate 6.474% 6.552% +0.01 Regular Rate 30 Year Fixed Rate 6.998% 7.048% No Change 30 Year Fixed Rate VA 6.802% 6.848% -0.25 Regular Rate 20 Year Fixed Rate 6.812% 6.869% -0.02 30 Year Fixed Rate FHA 6.685% 6.732% -0.27 Regular Rate 10 Year Fixed Rate 6.543% 6.63% +0.04 Rates are provided by our partner network and may not reflect the market. Your rate may vary. Click here for a personalized interest rate quote. See our interest rate assumptions. Find and lock in a low rate
Should you lock in your mortgage rate today?
Mortgage rates ended the day in a better position than they began June, but the overall month-to-month change was smaller than the daily change we've seen this year, so this is more good news than great news.
There's a good chance we'll have more good months in the near future, but unfortunately, there's just as much bad months right now.
With any luck, there will be more consistently good months later this year, which is not guaranteed, but many observers are hoping for.
But in the meantime, I see little point in betting on effectively even bets, so my personal recommendation to lock in rates remains the same.
Lock if closing within 7 days Lock if closing within 15 days Lock if closing within 30 days Lock if closing within 45 days Lock if closing within 60 days
Of course, we're not suggesting you wait until mortgage rates are falling to sign a contract. There will be plenty of days and long periods when interest rates look bright. By all means, take advantage of those days.
Additionally, with so much uncertainty at the moment, it's entirely possible that your intuition is as good as mine, if not better, so follow your instincts and your tolerance for risk.
Current trends in mortgage interest rates
Important economic reports next week
There are two reports competing for the title of the economic report that will most impact mortgage rates (and many other things), one of which is the official monthly employment report, which is due to be released next Friday morning, July 5th.
The other is the Consumer Price Index (CPI), due to be released on July 11. So mortgage rates could be in for a stimulating period.
For these rates to fall, we need the numbers in both reports to be lower than market expectations. The only exception is the unemployment rate in the jobs report: the higher this number is, the better it is for mortgage rates (but not for the unemployed).
Next week, I'll let you know what the market is expecting from the CPI, but I can tell you right now what the market is expecting from the jobs report, according to MarketWatch.
Nonfarm payrolls (new jobs created in June) — 195,000, down from 272,000 in May. Unemployment rate — 4.0%, unchanged from May. Hourly wages — 0.3%, down from 0.4% in May.
Be warned: market expectations regarding employment data are often wildly off.
These forecasts are based on “analyst consensus forecasts.” Analysts are economists who specialize in a particular aspect of the economy, in this case the job market. They are surveyed by various organizations, including MarketWatch, for their forecasts and an average or consensus is established.
Analysts forecasting the PCE price index yesterday were spot on in predicting all four components of the report, but analysts focusing on employment did abysmal.
Still, investors take these forecasts seriously and often adjust their portfolios before the report is released, meaning market expectations are already priced into mortgage rates.
If these forecasts prove incorrect, investors will attempt to rebalance their portfolios to match reality, which could result in significant volatility.
Other economic reports coming up next week
As always, some reports coming out next week will have little to no impact on mortgage rates. Other reports will occasionally move rates, but usually only slightly and temporarily.
The latter category includes the Purchasing Managers' Index (PMI), which reports on procurement sector activity and gives real insight into how well manufacturers and service providers are prepared to supply, with two due to be released on Monday and two more on Wednesday.
Another report that could move mortgage rates up or down is the ADP employment report due on Wednesday. It measures only private sector employment and is less influential than the official jobs report, but investors sometimes view it as a harbinger of bigger events.
The same goes for the weekly number of initial jobless claims, due to be released on Wednesday. Investors typically realize that there is little value in looking at just one week of data, but data released just before the employment report is sometimes taken more seriously.
The May Job Openings and Labor Turnover Survey (JOLTS) is due for release on Tuesday, a useful tool for getting a sense of the state of the labor market.
Federal Reserve Event
It's also worth noting that Federal Reserve Chairman Jerome Powell is scheduled to speak next Tuesday, and Wall Street is always hanging on his every word.
Also, the minutes of the last meeting of the Fed's interest rate-setting committee are due to be released next Wednesday. The Fed has been more open about these meetings, so the minutes don't offer as many surprises as they used to, but there's always the possibility of surprises.
Overview of next week's economic reports and events
See above for details on some of the more important economic reports coming up next week, as well as explanations of the abbreviations below.
In the list below of next week's reports, only those in bold are likely to have a noticeable impact on mortgage rates. The rest of the reports are unlikely to have a big impact unless they contain surprisingly good or bad data.
Monday – June manufacturing PMIs from S&P and the Institute for Supply Management (ISM). Also, construction spending for May. Tuesday – Fed Chairman's speech. Also, May JOLTS. Wednesday – June ADP employment report. Two service sector June PMIs from S&P and ISM. Also, May trade deficit and factory orders, Fed minutes. Also, initial jobless claims for the week ending June 29th. Thursday – No report, markets closed for Independence Day. Mortgage rates expected to remain unchanged. Friday – June employment report
Like last week, Friday is the big day.
Time to move? Find the mortgage that's right for you
Next week's mortgage interest rates forecast
Again, I have to refrain from making predictions about what mortgage rates will do next week, as the direction of rates will likely change with Friday's jobs report, and I have no idea what that means.
How home loan interest rates are determined
The bond market generally determines mortgage and refinancing interest rates, and is where mortgage-backed securities trade.
And it depends a lot on the economy: mortgage rates tend to be higher in good times and lower in bad times, but inflation can counterbalance these trends.
Your role
But there are five roles you play in determining your mortgage interest rate: And you can have a big impact on your rate in the following ways:
Shop around for the best mortgage rate — rates vary widely from lender to lender Increase your credit score — even a small increase can make a big difference in your interest rate and payment Save up as large a down payment as you can — lenders want you to be serious about the game Stay modest on your other borrowing — the fewer other monthly commitments you have, the larger the mortgage you can pay Choose your mortgage carefully — is a conventional, conforming, FHA, VA, USDA, jumbo, or another loan better for you?
Taking the time to prepare these things can help you win a lower interest rate.
Remember, these aren't just mortgage rates
When calculating how much of a mortgage you can afford, be sure to factor in all of the upcoming costs of homeownership. Keep an eye out for something called “PITI,” which means:
Principal — the repayment of the amount borrowed Interest — the cost of borrowing money Taxes — especially property taxes Insurance — especially homeowners insurance
Our mortgage calculator can help you with this.
Depending on the type of mortgage and the size of your down payment, you may also have to pay mortgage insurance, which can easily reach triple figures each month.
But there are other potential costs, too: Namely, if you choose to live somewhere with an HOA, you'll have to pay homeowner's association dues. And no matter where you live, you should be prepared for repair and maintenance costs, so you don't have to worry about having to contact your landlord if something goes wrong.
Finally, it's hard to forget about closing costs, which are reflected in the annual percentage rate (APR) offered by your lender, which essentially spreads the costs over the life of the loan, meaning that the rate will be higher than a typical mortgage interest rate.
But you may be able to get help with closing costs and down payments, especially if you're a first-time home buyer. Learn more:
State down payment assistance programs for 2023
How to calculate mortgage interest rates
Every day, Mortgage Report receives interest rates based on your chosen criteria from multiple lending partners. It calculates the average interest rate and APR for each loan type and displays them in a chart. It averages the different interest rates so you get a more accurate picture of what interest rates you can find in the market. It also calculates the average interest rate for the same loan type, for example, FHA fixed rate vs. FHA fixed rate. The result is a clearer picture of your daily interest rates and how they change over time.