Mortgage rates fell over the bank holiday weekend. The rate on a 30-year fixed-rate loan is on average 3.379%, down 0.039 percentage points from Friday. Other types of loans were mostly lower, although the 10/1 variable rate mortgage saw a sharp increase of 0.306 percentage points.

The mostly lower rates come after Freddie Mac’s benchmark rate for a 30-year loan fell below 3% last Thursday.

Rates have hovered over the past two weeks with no clear indication of a prolonged increase or decrease. This is good news for qualified borrowers considering buying a home or refinancing a mortgage, as it means there is still a chance to take advantage of historically low rates.

  • The latest rate on a 30 year fixed rate mortgage is 3.379%.
  • The last rate on a 15 year fixed rate mortgage is 2.453%.
  • The latest rate on a Jumbo ARM 5/1 is 2.244%.
  • The latest rate on a 7/1 compliant ARM is 4.10%.
  • The latest rate on a 10/1 compliant ARM is 4.20%.

Mortgage rates today: 30-year fixed rate mortgage rates

  • The 30-year rate is 3.379%.
  • It’s a day offold by 0.031 percentage point. ⇓
  • This is unchanged since one month. ⇔

With a fixed rate loan, your interest rate and monthly payment will stay the same for the life of the loan. Thanks to its long payback period, a 30 year fixed rate mortgage will have lower monthly payments than shorter term fixed rate loans. The interest rate, on the other hand, will usually be higher, which means you’ll pay more interest over time.

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Average mortgage rates

Data based on U.S. mortgages closed July 2, 2021

Type of loan July 2nd Last week Switch
Conventional Fixed 15 Years 2.45% 2.54% 0.09%
Conventional Fixed 30 Years 3.38% 3.47% 0.09%
ARM rate 7/1 4.1% 4.11% 0.01%
ARM rate 10/1 4.2% 3.79% 0.41%

Your actual rate may vary

Mortgage rates today: 15 years fixed rate mortgage rates

  • The 15-year rate is 2.453%.
  • It’s a day offold by 0.027 percentage point. ⇓
  • It’s a month increase by 0.019 percentage points. ⇑

A 15 year loan is a shorter term fixed rate mortgage. Due to the shorter payback period, the monthly payments will be higher than those of the longer term loan. However, the interest rate is usually lower, which means you won’t pay as much interest with a 15-year loan.

Mortgage Rates Today: Jumbo Variable Rate Mortgage Rates 5/1

  • The ARM 5/1 rate is 2.244%.
  • This is unchanged starting on Friday. ⇔
  • It’s a month offold by 1,303 percentage points. ⇓

Variable rate mortgages will start with a fixed interest rate and then become variable, resetting at predetermined intervals. The monthly payments will be fixed initially but will then evolve according to the rate. If you opt for an ARM 5/1 for example, the rate will be fixed for five years, then reset each year thereafter. You can also opt for an ARM 7/1, ARM 10/1, or one of the many other variable rate terms. ARMs will generally be repaid over 30 years.

Mortgage Rates Today: VA, FHA, and Jumbo Loan Rates

The average rates for FHA, VA and jumbo loans are:

  • The rate for a 30-year FHA mortgage is 3.078%. ⇓
  • The rate for a 30-year VA mortgage is 3.144%. ⇓
  • The rate for a 30-year jumbo mortgage is 3.503%. ⇓

Mortgage Refinance Rate Today

The average rates for 30-year, 15-year and 5/1 jumbo ARM loans are:

  • The refinance rate on a 30 year fixed rate refinance is 3.799%. ⇓
  • The refinancing rate on a 15 year fixed rate refinance is 2.655%. ⇓
  • The refinancing rate on a Jumbo ARM 5/1 is 2.529%. ⇔
  • The refinancing rate on a 7/1 compliant ARM is 4.255%. ⇓
  • The refinancing rate on a 10/1 compliant ARM is 4.56%. ⇓
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Average mortgage refinancing rates

Data based on U.S. mortgages closed July 2, 2021

Type of loan July 2nd Last week Switch
Conventional Fixed 15 Years 2.66% 2.74% 0.08%
Conventional Fixed 30 Years 3.8% 3.9% 0.1%
ARM rate 7/1 4.26% 4.25% 0.01%
ARM rate 10/1 4.56% 4.13% 0.43%

Your actual rate may vary

Where Are Mortgage Rates Going This Year?

Mortgage rates fell through 2020. Millions of homeowners responded to low mortgage rates by refinancing existing loans and taking out new ones. Many people have bought homes that they might not have been able to afford if the rates were higher.

In January 2021, rates briefly fell to all-time low levels, but tended to rise throughout the month and into February.

Looking ahead, experts believe that interest rates will rise further in 2021, but modestly. Factors that could influence the rates include how quickly COVID-19 vaccines are distributed and when lawmakers can agree on another cost-effective relief package. More vaccinations and government stimulus could lead to improved economic conditions, which would increase rates.

Although mortgage rates are likely to rise this year, experts say the increase will not happen overnight and it will not be a dramatic jump. Rates are expected to stay near their historically low levels throughout the first half of the year, rising slightly later in the year. Even with rates rising, this will still be a good time to finance a new home or refinance.

Factors that influence mortgage rates include:

  • The Federal Reserve. The Fed took swift action when the pandemic hit the United States in March 2020. The Fed announced plans to move money through the economy by lowering the Federal Fund’s short-term interest rate between 0% and 0.25%, which is as low as they go. The central bank has also committed to buying mortgage-backed securities and treasury bills, thereby supporting the housing finance market. The Fed has reaffirmed its commitment to these policies for the foreseeable future on several occasions, most recently at a policy meeting in late January.
  • The 10-year Treasury note. Mortgage rates move at the same pace as the yields on 10-year government treasury bills. Yields fell below 1% for the first time in March 2020 and have slowly risen since then. Currently, yields have hovered above 1% year-to-date, pushing interest rates up slightly. On average, there is typically a 1.8 point “spread” between Treasury yields and benchmark mortgage rates.
  • The economy in the broad sense. Unemployment rates and changes in gross domestic product are important indicators of the overall health of the economy. When employment and GDP growth are low, it means the economy is weak, which can lower interest rates. Thanks to the pandemic, unemployment levels hit historic highs early last year and have yet to recover. GDP has also been affected, and although it has rebounded somewhat, there is still a lot of room for improvement.

Tips for getting the lowest mortgage rate possible

There is no universal mortgage rate that all borrowers receive. Qualifying for the lowest mortgage rates takes a bit of work and will depend on both personal financial factors and market conditions.

Check your credit score and your credit report. Mistakes or other red flags that can lower your credit score. The borrowers with the highest credit scores will get the best rates, so it’s essential to check your credit report before you begin the home search process. Taking action to correct mistakes will help increase your score. If you have high credit card balances, paying them off can also give you a quick boost.

Save money for a large down payment. This will lower your loan-to-value ratio, which means how much of the home’s price the lender has to finance. A lower LTV usually results in a lower mortgage rate. Lenders also like to see money that has been saved in an account for at least 60 days. It tells the lender that you have the money to finance the purchase of the house.

Shop around for the best rate. Don’t settle for the first interest rate a lender offers you. Check with at least three different lenders to see who is offering the lowest interest rate. Also consider the different types of lenders, such as credit unions and online lenders, in addition to traditional banks.

Also take the time to learn about the different types of loans. While the 30-year fixed-rate mortgage is the most common type of mortgage, consider a shorter-term loan such as a 15-year loan or an adjustable rate mortgage. These types of loans often have a lower rate than a conventional 30-year mortgage. Compare everyone’s costs to see which one best suits your needs and financial situation. Government loans – such as those backed by the Federal Housing Authority, the Department of Veterans Affairs, and the Department of Agriculture – may be more affordable options for those who qualify.

Finally, lock in your rate. Locking in your rate once you’ve found the right rate, the right loan product, and the lender will help ensure that your mortgage rate doesn’t increase until the loan closes.

Our mortgage rate methodology

Money’s Daily Mortgage Rates show the average rate offered by over 8,000 lenders in the United States for which the most recent rates are available. Today we are posting the rates for Friday July 2, 2021. Our rates reflect what a typical borrower with a credit score of 700 can expect to pay on a home loan right now. These rates were offered to people with a 20% deposit and include reduction points.

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