The average interest rate on a 30-year fixed-rate mortgage is 6.56% today, up 0.05% from last week. The average interest rate on a 15-year fixed-rate mortgage is 5.95%, up 0.04% from the same time last week. For an overview of mortgage rate trends, see the chart below.

With inflation at its lowest level since spring 2021 and the labor market cooling, the Federal Reserve will make its first interest rate cut in September. These factors should help mortgage rates fall in the coming months. But fixing the currently unaffordable housing market will require more than just lower mortgage rates.

Today’s average mortgage rates

mortgage

Refinancing

Today’s average mortgage rates on August 19, 2024 compared to one week ago. We use rate data collected by Bankrate and reported by lenders across the U.S.

---

Lower mortgage rates are finally on the way. You can take advantage of this by comparing multiple offers to get the best deal on your home loan. Enter your details here to get a customized quote from one of CNET’s partner lenders.

About these tariffs: Like CNET, Bankrate is part of Red Ventures. This tool offers partner rates from lenders that you can use when comparing multiple mortgage rates.

---

Current mortgage interest rate trends

Mortgage rates react to a number of factors, including the bond market, investor expectations, inflation and the Fed’s monetary policy decisions.

When inflation is high, the Fed raises interest rates to slow the economy and reduce price pressure. Higher interest rates make it more expensive for banks to borrow money. To compensate for this, banks raise interest rates on consumer loans, such as mortgages.

In recent years, the Fed raised its short-term interest rate from near zero to a target range of 5.25 to 5.5 percent, and in response, mortgage rates skyrocketed.

Mortgage rates fell sharply in early August in response to a troubling jobs report that sparked recession fears. Although the average rate on a 30-year fixed-rate mortgage fell to a low of 6.5% in August, that’s still more than double the rate seen in 2020-21.

Will mortgage rates fall this year?

Mortgage rates have already fallen in 2024, largely due to market volatility. Now that markets are stabilizing, home loan rates may rise somewhat. However, in the long term, experts predict a gradual decline in mortgage rates.

How far interest rates will fall this year will continue to depend on upcoming inflation and labor market data. With economic growth expected to continue to slow, the Fed will likely cut rates at its September meeting. The central bank could also make one or two more rate cuts this year.

“As history shows, once the cut begins, it sets off a series of rate cuts over a long period of time,” said Greg Sher, managing director of NFM Lending. “The first cut will provide some breathing room for those who are tied to a property or are interested in buying.”

One thing is certain, however: a return to mortgage interest rates of 2-3% as they were just a few years ago is unlikely.

Here’s a look at some major housing authorities’ projections for average mortgage rates.

What different types of mortgages are there?

Every mortgage has a term or payment plan. The most common mortgage terms are 15 and 30 years, but there are also 10, 20 and 40 year mortgages. With a fixed rate mortgage, the interest rate is fixed for the entire life of the loan, which offers stability. With an adjustable rate mortgage, the interest rate is only fixed for a specific period of time (usually five, seven or 10 years), after which the interest rate adjusts annually based on market conditions. Fixed rate mortgages are a better option if you plan to live in a home long-term, but adjustable rate mortgages may offer lower interest rates up front.

30-year fixed-rate mortgages

The average interest rate on a 30-year fixed-rate mortgage today is 6.56%. A 30-year fixed-rate mortgage is the most common loan term. It often has a higher interest rate than a 15-year mortgage, but your monthly payment is lower.

15-year fixed-rate mortgages

Today, the average interest rate on a 15-year fixed-rate mortgage is 5.95%. Although your monthly payment will be higher than a 30-year fixed-rate mortgage, the interest rate on a 15-year loan is typically lower, so you’ll pay less interest over the long run and pay off your mortgage faster.

5/1 variable rate mortgages

A 5/1 adjustable rate mortgage has an average interest rate of 6.15% today. For the first five years of the mortgage, a 5/1 adjustable rate mortgage will typically get you a lower introductory interest rate. However, after that period, you could pay more depending on how the interest rate adjusts annually. If you plan to sell or refinance your home within five years, an adjustable rate mortgage could be a good option.

Calculate your monthly mortgage payment

Taking out a mortgage should always depend on your financial situation and long-term goals. The most important thing is to set a budget and try to stay within your means. CNET’s mortgage calculator below can help homebuyers prepare for monthly mortgage payments.

What tips are there for finding the best mortgage rates?

Although mortgage rates and home prices are high, the housing market will not remain unaffordable forever. It’s always a good time to save for a down payment and improve your credit score to secure a favorable mortgage rate when the time is right.

1. Save for a larger down payment: Although a 20% down payment is not required, a higher down payment means you can take out a smaller mortgage, saving you interest.
2. Increase your creditworthiness: A credit score of 620 can qualify you for a conventional mortgage, but a higher score of at least 740 will get you better interest rates.
3. Pay off debts: Experts recommend a debt-to-income ratio of 36% or less to qualify for the best interest rates. If you don’t have other debt, you’ll be in a better position to make your monthly payments.
4. Research loans and support: Government-backed loans have more flexible loan terms than traditional loans. Some government-backed or private programs can also help you with the down payment and closing costs.
5. Compare lenders’ rates: By researching and comparing several loan offers from different lenders, you can secure the best mortgage rate for your situation.