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- Personal Finance News
- Mortgage Rates
By
Ben Woolsey
Published August 16, 2024
Rates on 30-year mortgage refinance loans rose 8 basis points on average Thursday, following a three-day decline of almost half a percentage point. That pushed the 30-year refi average to 6.74%.
Rate movement was largely up for most refinance loan types Thursday, although the 10-year and VA 30-year fixed both fell. The jumbo 30-year refinance average climbed by 5 basis points.
National Averages of Lenders' Best Rates – Refinance | ||
---|---|---|
Loan Type | Refinance Rates | Daily Change |
30-Year Fixed | 6.74% | +0.08 |
FHA 30-Year Fixed | 6.20% | No Change |
VA 30-Year Fixed | 5.73% | -0.11 |
20-Year Fixed | 6.41% | +0.10 |
15-Year Fixed | 5.66% | +0.13 |
FHA 15-Year Fixed | 5.73% | No Change |
10-Year Fixed | 6.47% | -0.62* |
7/6 ARM | 7.58% | +0.05 |
5/6 ARM | 7.68% | +0.06 |
Jumbo 30-Year Fixed | 6.70% | +0.05 |
Jumbo 15-Year Fixed | 6.77% | +0.05 |
Jumbo 7/6 ARM | 7.46% | No Change |
Jumbo 5/6 ARM | 7.59% | No Change |
Provided via the Zillow Mortgage API |
Important
The rates we publish won’t compare directly with teaser rates you see advertised online since those rates are cherry-picked as the most attractive vs.the averages you see here. Teaser ratesmay involve paying points in advance or may be based on a hypothetical borrower with an ultra-high credit score or for a smaller-than-typical loan.The rate you ultimately secure will be based on factors like your credit score, income, and more, so it can vary from the averages you see here.
Since rates vary widely across lenders, it's always wise to shop around for your best mortgage refinance option and compare rates regularly, no matter the type of home loan you seek.
Calculate monthly payments for different loan scenarios with our Mortgage Calculator.
What Causes Mortgage Rates to Rise or Fall?
Mortgage rates are determined by a complex 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 at the same time, it's generally difficult to attribute any single 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 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 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, 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 eighth consecutive 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 feels 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 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.
Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in oureditorial policy.
Congressional Research Service. "Federal Reserve: Tapering of Asset Purchases," Page 1.
Federal Reserve. "Federal Open Market Committee Meeting Calendars, Statements, and Minutes (2019-2024)."
Related Terms
Cash-Out Refinancing Explained: How It Works and When to Do It
A cash-out refinance is a mortgage refinancing option that lets you convert home equity into cash. Use it with care.
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Fixed-Rate Mortgage: How It Works, Types, vs. Adjustable Rate
A fixed-rate mortgage is an installment loan that has a fixed interest rate for the entire term of the loan.
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Mortgage Interest: What It Is, How It Works
Mortgage interest is an expense paid by homeowners in addition to the principal balance of a mortgage loan.
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Forbearance: Meaning, Who Qualifies, and Examples
Forbearance is a form of repayment relief involving temporarily postponing loan payments, typically for home mortgages or student loans.
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Tracker Mortgage: What It Is, How It Works
A tracker mortgage is a home loan with interest determined by a base rate like that of the Bank of England or the European Central Bank. Learn how tracker mortgages work.
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Federal Housing Administration (FHA) Loan: Requirements, Limits, How to Qualify
A Federal Housing Administration (FHA) loan is a mortgage that is insured by the government and issued by a bank or other approved lender.
more
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