Mortgage rates are a smidge lower today thanks to yesterday’s announcement that the Treasury Department is going to increase purchases of long-term bonds. Mortgage interest rates are pegged to the 10-year Treasury note, so good news for the bond market is good news for mortgage rates.
The average interest rate on a 30-year, fixed-rate mortgage ticked down to 6.51% APR, according to rates provided to NerdWallet by Zillow. This is three basis points lower than yesterday and five basis points lower than a week ago. (See our chart below for more specifics.) A basis point is one one-hundredth of a percentage point.
Inflation’s been a catalyst for the bond market’s recent issues, and yesterday we got a little more insight into what the Federal Reserve thinks about rising prices. For the scoop on that, keep reading below the chart.
Average mortgage rates, last 30 days
📈 What influences mortgage rates?
Yesterday afternoon we finally got a peek at the Federal Reserve’s July meeting minutes. The Fed held rates steady in July, but three officials dissented, favoring a quarter-point hike.
Personally, I’d been hoping to see a little more clarity on how the central bankers are thinking about inflation, but this didn’t bring much. To be fair, the meeting minutes are always vague, with lots of “many,” “several,” and “some.” It’s literally twelve people, so your guess is as good as mine what those words indicate. Is “many” nine? Six?
For what it’s worth, “many participants assessed that policy tightening would likely be necessary if inflation did not decline,” and policy tightening means higher rates. For me, that “likely” is really softening this statement — even in the face of higher inflation, a rate hike would still be up for debate.
Overall, it seems likely (ha!) that it was only the three dissenters (“some” and “a few”) arguing that current policy wasn’t restrictive enough and that raising rates sooner could avoid having to take more drastic action later.
Next week we’ll get July’s Personal Consumption Expenditures Price Index, which is the Fed’s preferred measure of inflation. Forecasters currently predict PCE will also show inflation slowing, but just barely.
If a rate hike in September (or at either of 2026’s other two remaining Fed meetings) starts to shift from possible to probable, that’s going to put upward pressure on mortgage rates. Rate cuts feel unlikely, so stable mortgage rates may be the best case scenario right now.
But, but, but — that’s just what’s going on in the U.S. Any significant changes to the situation in Iran could drive rates higher or allow them to drift lower, depending on the news. In general, we’ve seen mortgage rates rise when the conflict escalates and fall when it ebbs.
Refinancing might make sense if today’s rates are at least 0.5 to 0.75 of a percentage point lower than your current rate (and if you plan to stay in your home long enough to break even on closing costs).
With rates where they are right now, you might start considering a refi if your current rate is around 7.01% or higher.
🏡 Should I start shopping for a home?
There is no universal “right” time to start shopping — what matters is whether you can comfortably afford a mortgage now at today’s rates.
🔒 Should I lock my rate?
Rate locks protect you from increases while your loan is processed, and with the market forever bouncing around, that peace of mind can be worth it.
🤓 Nerdy Reminder: Rates can change daily, and even hourly. If you’re happy with the deal you have, it’s okay to commit.
🧐 Why is the rate I saw online different from the quote I got?
In addition to market factors outside of your control, your customized quote depends on your:
Even two people with similar credit scores might get different rates, depending on their overall financial profiles.
👀 If I apply now, can I get the rate I saw today?
Maybe — but even personalized rate quotes can change until you lock. That’s because lenders adjust pricing multiple times a day in response to market changes.
