Unlock Today’s Mortgage Rates: Your State-by-State Guide for Dec. 9, 2024!
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Looking for a new home? If you’re in the market for a 30-year mortgage, you might want to take a closer look at states like New York, California, Maine, Florida, Colorado, Massachusetts, Oregon, and Texas. These states are currently offering some of the most competitive rates, with averages ranging between 6.31% and 6.50%. Now, that’s what we call smart shopping!
On the flip side, if you’re located in North Dakota, Rhode Island, Wyoming, Iowa, Vermont, Arkansas, Kansas, South Dakota, or Washington, D.C., be prepared for slightly higher rates, averaging between 6.61% and 6.63%. It’s a tale of two markets, and knowing where you stand can make all the difference in your mortgage journey!
Mortgage rates can be a wild ride, fluctuating depending on where you live. Each state has its own unique blend of lenders, credit scores, average loan sizes, and regulations that can sway your mortgage rate dramatically. And let’s not forget about the risk management strategies adopted by lenders – they too play a crucial role in the rates they offer!
With such vast differences in rates, it’s always wise to explore your mortgage options and compare rates. Shopping around is essential, whether you’re eyeing your first home loan or a new investment property.
Important Note!
The rates you see published here aren’t the same as those flashy teaser rates you might find online. Those are often cherry-picked to look appealing and may require paying points upfront or apply to an ideal borrower with a stellar credit score. Your ultimate rate will depend on your unique financial profile, including your credit score and income, so make sure to do your homework!
National Mortgage Rate Averages
As of Friday, the average rate for a 30-year new purchase mortgage dipped to 6.53% – the lowest it’s been since mid-October! Just a month prior, we saw rates plummet to 5.89%, which was a two-year low. Although rates are still on the higher side compared to last summer, they’re trending downwards, providing some hope for prospective buyers!
| National Averages of Lenders’ Best Mortgage Rates | |
|---|---|
| Loan Type | New Purchase |
| 30-Year Fixed | 6.53% |
| FHA 30-Year Fixed | 6.28% |
| 15-Year Fixed | 5.71% |
| Jumbo 30-Year Fixed | 6.53% |
| 5/6 ARM | 7.24% |
| Source: Provided via the Zillow Mortgage API | |
If you’re curious about what your monthly payments might look like, give our Mortgage Calculator a try!
What Causes Mortgage Rates to Rise or Fall?
Understanding what drives mortgage rates is key. A myriad of macroeconomic and industry factors come into play:
Each of these factors can fluctuate simultaneously, making it tricky to pinpoint the cause of any specific change. For much of 2021, macroeconomic influences kept mortgage rates relatively low, largely due to the Federal Reserve’s substantial bond-buying efforts in response to pandemic pressures. This policy has a significant impact on mortgage rates.
In late 2021, the Fed began to taper its bond purchases, leading to significant monthly reductions until reaching zero in March 2022.
From then until July 2023, the Fed took aggressive actions to combat soaring inflation by increasing the federal funds rate. While this rate doesn’t directly dictate mortgage rates, it influences them significantly. In fact, they can often move in opposite directions!
The rapid rate increases resulted in mortgage rates surging over the past couple of years. The Fed held its peak rate steady for nearly 14 months, but on September 18, they announced the first rate cut in a series expected to follow in 2024 and likely 2025, starting with a reduction of 0.50 percentage points.
On November 7, another cut of 0.25 percentage points was announced, bringing the federal funds rate down to between 4.5% and 4.75%. This marks the lowest rate since March 2023. Stay tuned for the Fed’s next announcement on December 18!
How We Track Mortgage Rates
The national and state averages mentioned above are sourced via the Zillow Mortgage API, based on a loan-to-value (LTV) ratio of 80% (which translates to a 20% down payment) and an applicant credit score in the range of 680-739. These rates give you a realistic expectation of what you might encounter when obtaining quotes from lenders, which can differ from those enticing teaser rates you see advertised.
