Most rates increase - Current mortgage rates, July 5, 2024

Mortgage rates were mostly higher versus last week, according to rate data collected by Bankrate. Average rates for 30-year fixed, 15-year fixed and jumbo mortgages moved higher, while 5/1 ARM rates decreased.

Inflation has cooled somewhat, but homebuyers are still feeling crunched by high prices and rates. At the close of the Fed meeting on June 12, policymakers chose to hold rates at current levels.. The next Fed meeting concludes July 31.

“With [the June 12] announcement, the Fed confirms its higher-for-longer position on interest rates,” says Dr. Selma Hepp, chief economist at CoreLogic. “But the stance is looking more untenable as more American households continue to pull back on spending. As more economic indicators begin to confirm this and unemployment begins to rise, the Fed will then look to cut rates. What’s not clear yet is when exactly the disinflation signs will be consistent enough for the first rate cut — we hope it's still this year.”

Often, though, the decision to buy a home isn’t based on what’s happening in the economy — it’s more personal. Depending on your situation, it might make sense to take a higher rate now and refinance later. This way you can start building equity, rather than hoping for a future of more favorable rates and home prices that might not materialize.

Rates last updated July 5, 2024.

The rates listed above are Bankrate's overnight average rates and are based on the assumptions indicated here. Actual rates displayed within the site may vary. This story has been reviewed by Suzanne De Vita. All rate data accurate as of Friday, July 5th, 2024 at 7:30 a.m. ET.

Today's 30-year mortgage rate goes up, +0.08%

The average rate for a 30-year fixed mortgage for today is 7.08 percent, an increase of 8 basis points over the last seven days. Last month on the 5th, the average rate on a 30-year fixed mortgage was lower, at 7.05 percent.

At the current average rate, you'll pay $670.68 per month in principal and interest for every $100,000 you borrow. That's up $5.38 from what it would have been last week.

The 30-year mortgage is the most popular home loan, and it has a number of advantages. Among them:

• Lower monthly payment: Compared to a shorter term, such as 15 years, the 30-year mortgage offers lower, more affordable payments spread over time.
• Stability: With a 30-year fixed mortgage, you lock in a set principal and interest payment, making it easier to plan your housing expenses for the long term. Remember: Your monthly housing payment can still change if your homeowners insurance premiums and property taxes go up or, less likely, down.
• Buying power: With lower payments, you might qualify for a larger loan amountor a more expensive home.
• Flexibility: Lower monthly payments can free up some of your monthly budget for other goals, like building an emergency fund, contributing to retirement or college tuition, or saving for home repairs and maintenance.

Learn more: What is a fixed-rate mortgage and how does it work?

15-year mortgage rate moves up, +0.06%

The average rate for the benchmark 15-year fixed mortgage is 6.53 percent, up 6 basis points over the last seven days.

Monthly payments on a 15-year fixed mortgage at that rate will cost roughly $873 per $100,000 borrowed. That may squeeze your monthly budget than a 30-year mortgage would, but it comes with some big advantages: You'll save thousands of dollars over the life of the loan in total interest paid and build equity much faster.

5/1 ARM moves down, -0.07%

The average rate on a 5/1 adjustable rate mortgage is 6.52 percent, falling 7 basis points from a week ago.

Adjustable-rate mortgages, or ARMs, are mortgage terms that come with a floating interest rate. To put it another way, the interest rate will change at regular intervals, unlike fixed-rate mortgages. These loan types are best for those who expect to sell or refinance before the first or second adjustment. Rates could be materially higher when the loan first adjusts, and thereafter.

While borrowers shunned ARMs during the pandemic days of super-low rates, this type of loan has made a comeback as mortgage rates have risen.

Monthly payments on a 5/1 ARM at 6.52 percent would cost about $633 for each $100,000 borrowed over the initial five years, but could ratchet higher by hundreds of dollars afterward, depending on the loan's terms.

Current jumbo mortgage rate moves upward, +0.04%

Today's average rate for jumbo mortgages is 7.14 percent, an increase of 4 basis points over the last week. Last month on the 5th, the average rate on a jumbo mortgage was higher at 7.16 percent.

At the current average rate, you'll pay a combined $674.73 per month in principal and interest for every $100,000 you borrow. That's an additional $2.70 per $100,000 compared to last week.

Mortgage refinance rates

Current 30 year mortgage refinance rate climbs, +0.12%

The average 30-year fixed-refinance rate is 7.11 percent, up 12 basis points compared with a week ago. A month ago, the average rate on a 30-year fixed refinance was lower at 7.08 percent.

At the current average rate, you'll pay $672.71 per month in principal and interest for every $100,000 you borrow. That's up $8.08 from what it would have been last week.

Where are mortgage rates going?

The rates on 30-year mortgages mostly mirror the 10-year Treasury yield, which changes with the market. The yield curve is a tool used by investors to predict where interest rates could be headed.

“The yield curve remains inverted — no surprise here,” says Ken Johnson of Florida Atlantic University. “Until the yield curve reverts to its normal upward slope, we will not see significant downward pressure on mortgage rates.”

Besides bond yields, the Federal Reserve’s key benchmark rate also has an impact. The Fed has held this rate at a 23-year high since July 2023.

If and when the Fed cuts interest rates depends on evolving economic data, such as inflation and the jobs market. While inflation has dropped from its height in 2022, it’s still well above the Fed’s target rate of 2 percent. Unemployment is still low, though in May it hit 4 percent for the first time since 2022.

“Much like that flight where departure keeps getting delayed 15 minutes at a time with no end in sight, the timetable for when the Fed begins to cut rates is equally uncertain,” says Greg McBride, CFA, Bankrate's chief financial analyst.

While the Fed bases its decisions on rate changes due to broader economic factors, your rate is also affected by personal finances. Depending on your credit score, down payment, debts and income, you could be quoted a rate that's higher or lower than the trend.

What current rates mean for you and your mortgage

Mortgage rates fluctuate daily, but it appears that, for now, they will remain above the historical lows of recent years. If you’re shopping for a mortgage, it might be wise to lock your rate when you find an affordable loan. If your house-hunt is taking longer than anticipated, revisit your budget so you’ll know exactly how much house you can afford at prevailing market rates.

Keep in mind: You could save thousands over the life of your mortgage by getting at least three loan offers, according to Freddie Mac research. You don’t have to stick with your bank or credit union, either. There are many types of mortgage lenders, including online-only and local, smaller shops.

"All too often, some [homebuyers] take the path of least resistance when seeking a mortgage, in part because the process of buying a home can be stressful, complicated and time-consuming," says Mark Hamrick, senior economic analyst for Bankrate. "But when we’re talking about the potential of saving a lot of money, seeking the best deal on a mortgage has an excellent return on investment. Why leave that money on the table when all it takes is a bit more effort to shop around for the best rate, or lowest cost, on a mortgage?”

More on current mortgage rates

• Expert poll: Mortgage rate trend predictions for this week
• The latest mortgage news for this week
• Compare current mortgage rates for today

Methodology

Bankrate displays two sets of rate averages that are produced from two surveys we conduct: one daily (“overnight averages”) and the other weekly (“Bankrate Monitor averages”).

The rates on this page represent our overnight averages. For these averages, APRs and rates are based on no existing relationship or automatic payments.

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