Editor’s Note: Parts of this story were auto-populated using data from Curinos, a mortgage research firm that collects data from more than 250 lenders. For more details on how we compile daily mortgage data, check out our methodology here.
Mortgage rates continue their decline. Today’s 30-year fixed rate is down to 6.74% APR, according to data from Curinos analyzed by the MarketWatch Guides team. That is down from last week’s rate of 6.93% APR.
While many in the mortgage industry were cautiously optimistic about modest rate cuts in September after last week’s Federal Reserve meeting, the jobs report that came out Friday seems to indicate bigger interest rate cuts are likely.
Christopher M. Naghibi, executive vice president and chief credit officer of First Foundation Bank, sees Treasury yields as another marker of possible cuts. “Among the most important market indicators to keep an eye on is the yield curve, particularly 2-year and 10-year Treasury yields. Currently, we are in the longest yield curve inversion in history with the shorter-term interest rates higher than longer-term rates,” he said. “This inversion of the yield curve is ordinarily seen as a harbinger of an economic slowdown and has preceded a recession in almost every observed instance. According to Bloomberg’s Bond Yield Forecast, we may come out of this inversion as early as Q1 of 2025. We can expect that the markets might shift with possible rate reductions expected to be announced in September, November, and December.” Naghibi’s remarks suggest that those in the market for a new home may be better off waiting it out over the next few months if possible.
Here are today’s average mortgage rates:
- 30-year fixed mortgage rate: 6.74%
- 15-year fixed mortgage rate: 6.02%
- 5/6 ARM mortgage rate: 6.59%
- Jumbo mortgage rate: 6.71%
Current Mortgage Rates
| Product | Rate | Last Week | Change |
| 30-Year Fixed Rate | 6.74% | 6.93% | -0.19 |
| 15-Year Fixed Rate | 6.02% | 6.39% | -0.37 |
| 5/6 ARM | 6.59% | 6.64% | -0.05 |
| 7/6 ARM | 6.64% | 6.76% | -0.12 |
| 10/6 ARM | 6.75% | 7.04% | -0.29 |
| 30-Year Fixed Rate Jumbo | 6.71% | 6.97% | -0.26 |
| 30-Year Fixed Rate FHA | 6.62% | 6.77% | -0.15 |
| 30-Year Fixed Rate VA | 6.66% | 6.77% | -0.11 |
Disclaimer: The rates above are based on data from Curinos, LLC. All rate data is accurate as of Tuesday, August 06, 2024. Actual rates may vary.
>> View historical mortgage rate trends
Mortgage Rates for Home Purchase
30-year fixed-rate mortgages are down, -0.19
The average 30-year fixed-mortgage rate is 6.74%. Since the same time last week, the rate is down, changing -0.19 percentage points.
At the current average rate, you’ll pay $647.93 per month in principal and interest for every $100,000 you borrow. You’re paying less compared to last week when the average rate was 6.93%.
15-year fixed-rate mortgages are down, -0.37
The average rate you’ll pay for a 15-year fixed-mortgage is 6.02%, a decrease of -0.37 percentage points compared to last week.
Monthly payments on a 15-year fixed-mortgage at a rate of 6.02% will cost approximately $844.94 per $100,000 borrowed. With the rate of 6.39% last week, you would’ve paid $865.07 per month.
5/6 adjustable-rate mortgages are down, -0.05
The average rate on a 5/6 adjustable rate mortgage is 6.59%, a decrease of -0.05 percentage points over the last seven days.
Adjustable-rate mortgages, commonly referred to as ARMs, are mortgages with a fixed interest rate for a set period of time followed by a rate that adjusts on a regular basis. With a 5/6 ARM, the rate is fixed for the first 5 years and then adjusts every six months over the next 25 years.
Monthly payments on a 5/6 ARM at a rate of 6.59% will cost approximately $638.00 per $100,000 borrowed over the first 5 years of the loan.
Jumbo loan interest rates are down, -0.26
The average jumbo mortgage rate today is 6.71%, a decrease of -0.26 percentage points over the past week.
Jumbo loans are mortgages that exceed loan limits set by the Federal Housing Finance Agency (FHFA) and funding criteria of Freddie Mac and Fannie Mae. This generally means that the amount of money borrowed is higher than $726,200.
| Product | Monthly P&I per $100,000 | Last Week | Change |
| 30-Year Fixed Rate | $647.93 | $660.61 | -$12.68 |
| 15-Year Fixed Rate | $844.94 | $865.07 | -$20.13 |
| 5/6 ARM | $638.00 | $641.30 | -$3.30 |
| 7/6 ARM | $641.30 | $649.26 | -$7.96 |
| 10/6 ARM | $648.60 | $667.99 | -$19.39 |
| 30-Year Fixed Rate Jumbo | $645.94 | $663.29 | -$17.35 |
| 30-Year Fixed Rate FHA | $639.98 | $649.93 | -$9.95 |
| 30-Year Fixed Rate VA | $642.63 | $649.93 | -$7.30 |
Note: Monthly payments on adjustable-rate mortgages are shown for the first five, seven and 10 years of the loan, respectively.
Factors That Affect Your Mortgage Rate
Mortgage rates change frequently based on the economic environment. Inflation, the federal funds rate, housing market conditions and other factors all play into how rates move from week-to-week and month-to-month.
But outside of macroeconomic trends, several other factors specific to the borrower will affect the mortgage interest rate. They include:
- Financial situation: Mortgage lenders use past financial decisions of borrowers as a way to evaluate the risk of loaning money.
- Loan amount and structure: The amount of money that bank or mortgage lender loans and its structure (including both the term and whether its a fixed-rate or adjustable-rate).
- Location: Mortgage rates vary by where you are buying a home. Areas with more lenders, and thus more competition, may have lower rates. Foreclosure laws can also impact a lender’s risk, affecting rates.
- Whether borrowers are first-time homebuyers: Oftentimes first-time homebuyer programs will offer new homeowners lower rates.
- Lenders: Banks, credit unions and online lenders all may offer slightly different rates depending on their internal determination.
How To Shop for the Best Mortgage Rate
Comparison shopping for a mortgage can be overwhelming, but it’s shown to be worth the effort. Homeowners may be able to save between $600 and $1,200 annually by shopping around for the best rate, researchers found in a recent study by Freddie Mac. That’s why we put together steps on how to shop for the best mortgage rate.
1. Check credit scores and credit reports
A borrower’s credit situation will likely determine the type of mortgage they can pursue, as well as their rate. Conventional loans are typically only offered to borrowers with a credit score of 620 or higher, while FHA loans may be the best option for borrowers with a FICO score between 500 and 619. Additionally, individuals with higher credit scores are more likely to be offered a lower mortgage interest rate.
Mortgage lenders often review scores from the three major credit bureaus: Equifax, Experian and TransUnion. By viewing your scores ahead of lenders considering you for a loan, you can check for errors and even work to improve your score by paying down balances and limiting new credit cards and loans.
2. Know the options
There are four standard mortgage programs: conventional, FHA, VA and USDA. To get the best mortgage rate and increase your odds of approval, it’s important for potential borrowers to do their research and apply for the mortgage program that best fits their financial situation.
The table below describes each program, highlighting minimum credit score and down payment requirements.
Though conventional mortgages are most common, borrowers will also need to consider their repayment plan and term. Rates can be either fixed or adjustable and terms can range from 10 to 30 years, though most homeowners opt for a 15- or 30-year mortgage.
3. Compare quotes across multiple lenders
Shopping around for a mortgage goes beyond comparing rates online. We recommend reaching out to lenders directly to see the “real” rate as figures listed online may not be representative of a borrower’s particular situation. While most experts recommend getting quotes from three to five lenders, there is no limit on the number of mortgage companies you can apply with. In many cases, lenders will allow borrowers to prequalify for a mortgage and receive a tentative loan offer with no impact to their credit score.
After gathering your loan documents – including proof of income, assets and credit – borrowers may also apply for pre-approval. Pre-approval will let them know where they stand with lenders and may also improve negotiating power with home sellers.
4. Review loan estimates
To fully understand which lender is offering the cheapest loan overall, take a look at the loan estimate provided by each lender. A loan estimate will list not only the mortgage rate, but also a borrower’s annual percentage rate (APR), which includes the interest rate and other lender fees such as closing costs and discount points.
By comparing loan estimates across lenders, borrowers can see the full breakdown of their possible costs. One lender may offer lower interest rates, but higher fees and vice versa. Looking at the loan’s APR can give you a good apples-to-apples comparison between lenders that takes into account both rates and fees.
5. Consider negotiating with lenders on rates
Mortgage lenders want to do business. This means that borrowers may use competing offers as leverage to adjust fees and interest rates. Many lenders may not lower their offered rate by much, but even a few basis points may save borrowers more than they might think in the long run. For instance, the difference between 6.8% and 7.0% on a 30-year, fixed-rate $100,000 mortgage is roughly $5,000 over the life of the loan.
Expert Forecasts for Mortgage Rates
Mortgage rates have cooled significantly over the past several months. After the 30-year fixed-rate mortgage hit 8% last October, it ended 2023 closer to 7%. In fact, the average for Q4 2023 was 7.3%.
Analysts with Fannie Mae and the Mortgage Bankers Association (MBA) both project that rates will fall going into 2024 and throughout next year.
Fannie Mae economists expect rates to drop more quickly, falling below 6% by Q4 2024. Meanwhile, the MBA’s forecast for Q4 2024 is 6.1% and 5.9% for Q1 2025.
More Mortgage Resources
Methodology
Every weekday, MarketWatch Guides provides readers with the latest rates on 11 different types of mortgages. Data for these daily averages comes from Curinos, LLC, a leading provider of mortgage research that collects data from more than 250 lenders. For more details on how we compile daily mortgage data, check out our comprehensive methodology here.
Editor’s Note: Before making significant financial decisions, consider reviewing your options with someone you trust, such as a financial adviser, credit counselor or financial professional, since every person’s situation and needs are different.
