Today’s average mortgage rate on a 30-year fixed-rate mortgage is 6.86%, down 1.07% from the previous week, according to the Mortgage Research Center.
Borrowers may be able to save on interest costs by going with a 15-year fixed mortgage, which will generally have a lower rate than a 30-year, fixed-rate home loan. The average APR on a 15-year fixed mortgage is 5.90%. But keep in mind that you’ll have higher monthly payments since you’re paying off your loan in half the time (15 years versus 30 years).
If you want to refinance your existing mortgage, check out the average refinance rate.
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30-Year Mortgage Rates Drop 1.07%
Today’s average rate on a 30-year, fixed-rate mortgage is 6.86%, which is 1.07% lower than last week.
The interest plus lender fees, called the annual percentage rate (APR), on a 30-year fixed mortgage is 6.89%. The APR was 6.97% last week.
To get an idea about how much you might pay in interest, consider that the current 30-year, fixed-rate mortgage of 6.86% on a $100,000 loan will cost $656 per month in principal and interest (taxes and fees not included), the Forbes Advisor mortgage calculator shows. The total amount you’ll pay in interest during the loan’s lifespan is $136,903.
15-Year Mortgage Rates Drop 1.88%
Today’s 15-year mortgage (fixed-rate) is 5.85%, down 1.88% from the previous week. The same time last week, the 15-year, fixed-rate mortgage was at 5.97%.
The APR on a 15-year fixed is 5.9%. It was 6.02% a week earlier.
A 15-year, fixed-rate mortgage with today’s interest rate of 5.85% will cost $836 per month in principal and interest on a $100,000 mortgage (not including taxes and insurance). In this scenario, borrowers would pay approximately $50,943 in total interest.
Jumbo Mortgage Rates Drop 0.60%
The current average interest rate on a 30-year, fixed-rate jumbo mortgage (a mortgage above 2025’s conforming loan limit of $806,500 in most areas) is 7.5%—0.60% lower than last week.
A 30-year jumbo mortgage at today’s fixed interest rate of 7.5% will cost you $699 per month in principal and interest per $100,000. That adds up to approximately $152,186 in total interest over the life of the loan.
Overview of 2025 Mortgage Rate Trends to Date
Mortgage rates initially trended downward post-spring 2024. However, they surged again in October 2024—despite cuts by the Federal Reserve to the federal funds rate (its benchmark interest rate) in September, November and December 2024.
Rates began to drop again in mid-January 2025, but experts don’t forecast them falling by a significant amount in the near future.
When Will Mortgage Rates Go Down?
Mortgage rates are influenced by various economic factors, making it difficult to predict when they will drop.
Mortgage rates follow U.S. Treasury bond yields. When bond yields decrease, mortgage rates generally follow suit.
The Federal Reserve’s decisions and global events also play a key role in shaping mortgage rates. If inflation rises or the economy slows, the Fed may lower its federal funds rate. For example, during the Covid-19 pandemic, the Fed reduced rates, which drove interest rates to record lows.
A significant drop in mortgage rates seems unlikely in the near future. However, they may decline if inflation eases or the economy weakens.
How Much House Can I Afford?
The amount of house you can afford depends on a number of factors, including your income and debt.
Here are a few basic factors that go into what you can afford:
- Income
- Debt
- Debt-to-income ratio (DTI)
- Down payment
- Credit score
How Are Mortgage Rates Determined?
Multiple factors affect the interest rate for a mortgage, including the economy’s overall health, benchmark interest rates and borrower-specific factors.
The Federal Reserve’s rate decisions and inflation can influence rates to move higher or lower. Although the Fed raising rates doesn’t directly cause mortgage rates to rise, an increase to its benchmark interest rate makes it more expensive for banks to lend money to consumers. Conversely, rates tend to decrease during periods of rate cuts and cooling inflation.
Home buyers can make several moves to improve their finances and qualify for competitive rates. One is having a good or excellent credit score, which ranges from 670 to 850. Another is maintaining a debt-to-income (DTI) ratio below 43%, which implies less risk of being unable to afford the monthly mortgage payment.
Further, making a minimum 20% down payment can help you avoid private mortgage insurance (PMI) on conventional home loans. If you can afford the larger monthly payment, 15-year home loans have lower rates than a 30-year term.
What Is the Best Type of Mortgage Loan?
Conventional home loans are issued by private lenders and typically require good or excellent credit and a minimum 20% down payment to get the best rates. Some lenders offer first-time home buyer loans and grants with relaxed down payment requirements as low as 3%.
For buyers with limited credit or finances, a government-backed loan is usually the better option as the minimum loan requirements are easier to satisfy.
For example, FHA loans can require 3.5% down with a minimum credit score of 580 or at least 10% down with a credit score between 500 and 579. However, upfront and annual mortgage insurance premiums can apply for the life of the loan.
Buyers in eligible rural areas with a moderate income or lower may also consider USDA loans. This program doesn’t require a down payment, but you pay an upfront and annual guarantee fee for the life of the loan.
If you come from a qualifying military background, VA loans can be your best option. First, you don’t need to make a down payment in most situations. Second, borrowers pay a one-time funding fee but don’t pay an annual fee as the FHA and USDA loan programs require.
Frequently Asked Questions (FAQs)
How do you get a lower mortgage interest rate?
Comparing lenders and loan programs is an excellent start. Borrowers should also strive for a good or excellent credit score between 670 and 850 and a debt-to-income ratio of 43% or less.
Further, making a minimum down payment of 20% on conventional mortgages can help you automatically waive private mortgage insurance premiums, which increases your borrowing costs. Buying discount points or lender credits can also reduce your interest rate.
How long can you lock in a mortgage rate?
Most rate locks last 30 to 60 days and your lender may not charge a fee for this initial period. However, extending the rate lock period up to 90 or 120 days is possible, depending on your lender, but additional costs may apply.
What determines your interest rate?
National average interest rates depend on economic and market conditions, including the bond market, inflation, the economy and Federal Reserve decisions.
Lenders set rates based on the loan type and term. In general, shorter terms tend to come with lower rates. Additionally, making a larger down payment signals less risk to the lender, which could get you a better rate.
Other factors that can impact your rate include your credit score, debt-to-income (DTI) ratio, income and property location.
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