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Mortgage rates are down in response to slowing inflation and renewed hopes that the Federal Reserve could cut the federal funds rate multiple times this year.
After spending most of the month in the upper 6% range, 30-year mortgage rates have finally dropped back down below 6.5%, according to Zillow data.
Last week, the Bureau of Labor Statistics reported that the Consumer Price Index rose 3.0% year over year in June. This was a significant cooldown from the previous month and lower than what many forecasters were expecting. As a result, mortgage rates decreased.
As long as inflation continues to slow, mortgage rates should ease throughout the remainder of 2024, improving affordability for hopeful homebuyers. If you're in the process of shopping for a home right now, you can limit the impact of today's still-high rates by getting quotes from at least three different mortgage lenders to be sure you're getting the best deal.
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Use our free mortgage calculator to see how today's mortgage rates would impact your monthly payments. By plugging in different rates and term lengths, you'll also understand how much you'll pay over the entire length of your mortgage.
Click "More details" for tips on how to save money on your mortgage in the long run.
Mortgage Rates for Buying a Home
30-Year Fixed Mortgage Rates Fall (-0.47%)
The current average 30-year fixed mortgage rate is 6.21%, down 47 basis points from where it was this time last week, according to Zillow data. This rate is also down compared to a month ago, when it was 6.62%.
At 6.21%, you'll pay $613 monthly toward principal and interest for every $100,000 you borrow.
The 30-year fixed-rate mortgage is the most common type of home loan. With this type of mortgage, you'll pay back what you borrowed over 30 years, and your interest rate won't change for the life of the loan.
20-Year Fixed Mortgage Rates Inch Decrease (-0.40%)
The average 20-year fixed mortgage rate is 40 basis points down from where it was last week, and is sitting at 6.03%. This time last month, the rate was 6.26%.
With a 6.03% rate on a 20-year term, your monthly payment will be $718 toward principal and interest for every $100,000 borrowed.
A 20-year term isn't as common as a 30-year or 15-year term, but plenty of mortgage lenders still offer this option.
15-Year Fixed Mortgage Rates Go Down (-0.41%)
The average 15-year mortgage rate is 5.66%, 41 basis points lower than last week. It's down compared to this time last month, when it was 6.05%.
With a 5.66% rate on a 15-year term, you'll pay $826 each month toward principal and interest for every $100,000 borrowed.
If you want the predictability that comes with a fixed rate but are looking to spend less on interest over the life of your loan, a 15-year fixed-rate mortgage might be a good fit for you. Because these terms are shorter and have lower rates than 30-year fixed-rate mortgages, you could potentially save tens of thousands of dollars in interest. However, you'll have a higher monthly payment than you would with a longer term.
7/1 ARM Rates Drop (-0.30%)
The 7/1 adjustable mortgage rate is down 30 basis points from a week ago at 6.39%. It's also down compared to a month ago, when it was at 6.97%.
At 6.39%, your monthly payment would be $625 toward principal and interest for every $100,000 borrowed — but only for the first seven years. After that, your payment would increase or decrease annually depending on the new rate.
5/1 ARM Rates Lower This Week (-0.37%)
The average 5/1 ARM rate is 6.26%, a 37-basis-point decrease from last week. It's down compared to where it was a month ago, when it was 6.79%.
Here's how a 6.26% rate would affect you for the first five years: You'd pay $616 per month toward principal and interest for every $100,000 you borrow.
30-Year FHA Rates Fall (-0.45)
The average 30-year FHA interest rate is 5.54% today, down 45 basis points from the week before. This rate was 6.10% a month ago.
At 5.54%, you would pay $570 monthly toward principal and interest for every $100,000 borrowed.
FHA mortgages are good choices if you don't qualify for a conforming mortgage. You'll need a 3.5% down payment and 580 credit score to qualify.
30-Year VA Rates Tick Down (-0.27%)
The current VA mortgage rate is 5.58%, 27 basis points lower than this time last week. This rate was 6.04% a month ago.
With a 5.58% rate, your monthly payment would be $573 toward principal and interest for every $100,000 you borrow.
Mortgage Refinance Rates
30-Year Fixed Refinance Rates Decrease (-0.39%)
The average 30-year refinance rate is 7.45%, 39 basis points down from last week. It's down compared to a month ago, when it was 7.79%.
Here's how a 7.45% rate would affect your monthly payments: You'd pay $696 toward principal and interest for every $100,000 borrowed.
Refinancing into a 30-year term can land you lower monthly payments, but you'll ultimately pay more by refinancing into a longer term.
20-Year Fixed Refinance Rates Drop a Bit (-0.17%)
The current 20-year fixed refinance rate is 6.62%, which is down 17 basis points compared to a week ago. This rate was 7.11% this time last month.
A 7.53% rate on a 20-year term will result in a $807 monthly payment toward principal and interest for every $100,000 you borrow.
15-Year Fixed Refinance Rates Tick Up (+0.23%)
The average 15-year fixed refinance rate is 6.15%, which is 23 basis points higher compared to last week. It's down slightly compared to this time a month ago, when it was at 6.28%.
A 6.15% rate on a 15-year term means you'll pay $852 each month toward principal and interest for every $100,000 borrowed.
Refinancing into a 15-year term can save you money in the long run, because you'll get a lower rate and pay off your mortgage faster than you would with a 30-year term. But it could result in higher monthly payments.
7/1 ARM Refinance Rates Fall (-0.53%)
The average 7/1 ARM refinance rate is 6.43%, down 53 basis points from where it was last week. It's also down from a month ago, when it was 6.83%.
Refinancing into a 7/1 ARM with a 6.43% rate means your monthly payment toward principal and interest will be $627 for every $100,000 you borrow. This will be the payment for the first seven years, then your rate will change annually unless you refinance again.
5/1 ARM Refinance Rates Go Down (-0.13%)
The 5/1 ARM refinance rate is 6.25%, which is 13 basis points lower than it was this time last week. It's down compared to this time last month, when it was 6.50%.
A 6.25% rate will result in a monthly payment of $616 toward principal and interest for every $100,000 borrowed. You'll pay this amount for the first five years of your new mortgage.
30-Year FHA Refinance Rates Drop Slightly (-0.16)
The 30-year FHA refinance rate is 5.63%, which is down 16 basis points from this time last week. It was 5.79% a month ago.
A 5.63% refinance rate would lead to a $576 monthly payment toward the principal and interest per $100,000 borrowed.
30-Year VA Refinance Rates Inch Down (-0.06)
The average 30-year VA refinance rate is 5.85%, which is down six basis points compared to where it was was last week. This rate was 5.88% a month ago.
At 5.85%, your new monthly payment would be $590 toward principal and interest for every $100,000 you borrow.
Are Mortgage Rates Going Down?
Mortgage rates started ticking up from historic lows in the second half of 2021 and increased over three percentage points in 2022. Mortgage rates also rose dramatically in 2023, though they started trending back down toward the end of the year. Though rates have been somewhat elevated recently, they should go down by the end of 2024.
For homeowners looking to leverage their home's value to cover a big purchase — such as a home renovation — a home equity line of credit (HELOC) may be a good option while we wait for mortgage rates to ease further. Check out some of our best HELOC lenders to start your search for the right loan for you.
A HELOC is a line of credit that lets you borrow against the equity in your home. It works similarly to a credit card in that you borrow what you need rather than getting the full amount you're borrowing in a lump sum. It also lets you tap into the money you have in your home without replacing your entire mortgage, like you'd do with a cash-out refinance.
Current HELOC rates are relatively low compared to other loan options, including credit cards and personal loans.
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