The refinancing rates for 30-year loans remained constant on Wednesday, maintaining an average of 7.00%, following a decrease of nine basis points during the two preceding days. This rate is the lowest since April 4 and shows a considerable improvement compared to the ten-month peak of 7.32% in May. Although the 30-year refi rates reached a low of 6.71% in March, the current rates are relatively higher. They also exceed last September's average by nearly a percentage point, which was at a two-year low of 6.01%.
The rate changes for other types of refinance loans varied on Wednesday. The 15-year refi average rose by a single basis point and the 20-year average dropped 2 points. However, jumbo 30-year refinance rates surged up by 10 points.
It's important to note that the rates published won't directly compare with attractive teaser rates typically advertised online. Final rates will vary based on factors such as credit score, income, and loan size. As rates differ significantly across lenders, borrowers are advised to shop around for the best mortgage refinance options and compare rates regularly.
Mortgage rates are impacted by a range of macroeconomic and industry factors and can be influenced by several elements at the same time. In 2021, the Federal Reserve's bond-buying policy in response to the pandemic's economic pressures kept the mortgage market relatively low. This policy began tapering off in November 2021 and reached net zero by March 2022. It coincided with the Federal Reserve's aggressive hiking of the federal funds rate to address inflation, which indirectly influenced the rise of mortgage rates over the past two years.
In September, the central bank made the first rate cut and followed with two more cuts in the subsequent months. However, it held rates steady in its fourth meeting of 2025, indicating potential months of rate stability. During their March 19 meeting, the central bank forecasted only two quarter-point rate cuts for the remainder of the year, suggesting possible rate-hold announcements in 2025.
The above-mentioned national and state averages reflect a loan-to-value (LTV) ratio of 80% and credit scores ranging from 680 to 739, indicating what borrowers can expect based on their qualifications, which may differ from advertised teaser rates.