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Mortgage rates are basically the same as where they were on Friday, but they’re much lower than where they were just two weeks ago.
The average interest rate on a 30-year, fixed-rate mortgage ticked down to 6.16% APR, according to rates provided to NerdWallet by Zillow. This is one basis point lower than yesterday, seven basis points lower than a week ago and nearly 30 basis points lower than at the end of March. (See our chart below for more specifics.) A basis point is one one-hundredth of a percentage point.
Mortgage rates have been affected by the war in Iran, bobbing up and down according to whether the news is “good” (like a ceasefire) or “bad” (like increased attacks). You can’t time the market or the war, but if you can afford today’s rate, lock it in — it could all change tomorrow.
Average mortgage rates, last 30 days
📉 When will mortgage rates drop?
Mortgage rates are constantly changing, since a major part of how rates are set depends on reactions to new inflation reports, job numbers, Fed meetings, global news … you name it. For example, even tiny changes in the bond market can shift mortgage pricing.
Recently, mortgage rates’ movements have been highly related to day-to-day events overseas — or really, reacting to the bond market’s reaction to those events — more than the longer-term economic outlook. That could be shifting as the market begins to see the immediate risk of inflation pale in comparison to the prospect of slowing economic growth.
The Federal Reserve is much less reactive, and while the Fed doesn’t set mortgage rates, anticipations of a rate cut or hike from the central bankers can get mortgage rates moving. “For now, this jump in the inflation rate can be seen as something the Fed could, in theory, ‘look through,'” says Elizabeth Renter, NerdWallet senior economist. “Not only does Fed interest rate policy have a limited impact on supply shocks such as this, the initial shock alone won’t drive persistent inflation, or faster price growth. It could eventually stoke an inflationary problem — as these higher prices seep into other parts of the economy and consumers and businesses modify their expectations and behaviors — but we aren’t there right now.”
The Fed has a dual mandate of maintaining strong employment and stable prices, and over the past couple weeks we’ve gotten new data on both. The job market appears surprisingly resilient, though it’s likely not yet showing the effects of the Iran War. Anyone who drives knows that gas prices have risen sharply, so the rate of inflation is well above where the Fed wants it to be. But as Renter notes, the Fed may well view war-driven inflation as transitory (one of the central bankers’ favorite words). For now, markets are all in on the Federal Reserve holding rates steady when they meet at the end of the month.
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 may want to start considering a refi if your current rate is around 6.66% or higher.
Also consider your goals: Are you trying to lower your monthly payment, shorten your loan term or turn home equity into cash? For example, you might be more comfortable with paying a higher rate for a cash-out refinance than you would for a rate-and-term refinance, so long as the overall costs are lower than if you kept your original mortgage and added a HELOC or home equity loan.
If you’re looking for a lower rate, use NerdWallet’s refinance calculator to estimate savings and understand how long it would take to break even on the costs of refinancing.
🏡 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.
If the answer is yes, don’t get too hung up on whether you could be missing out on lower rates later; you can refinance down the road. Focus on getting preapproved, comparing lender offers, and understanding what monthly payment works for your budget.
NerdWallet’s affordability calculator can help you estimate your potential monthly payment. If a new home isn’t in the cards right now, there are still things you can do to strengthen your buyer profile. Take this time to pay down existing debts and build your down payment savings. Not only will this free up more cash flow for a future mortgage payment, it can also get you a better interest rate when you’re ready to buy.
If you already have a quote you’re happy with, you should consider locking your mortgage rate, especially if your lender offers a float-down option. A float-down lets you take advantage of a better rate if the market drops during your lock period.
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?
The rate you see advertised is a sample rate — usually for a borrower with perfect credit, making a big down payment, and paying for mortgage points. That won’t match every buyer’s circumstances.
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.
About the author
Taylor Getler is a home and mortgages writer for NerdWallet. Her work has been featured in outlets such as MarketWatch, Yahoo Finance, MSN and Nasdaq. Taylor is enthusiastic about financial literacy and helping consumers make smart, informed choices with their money.
