Today's Mortgage Rates | Why Rates Have Been So High This Month

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• Mortgage rates for November 17, 2024, are hovering around 6.60%.
• Rates have been elevated thanks to strong economic data, shifting expectations around Fed cuts, and the election.
• Where rates go next depends on how the economy evolves in the coming months.

Mortgage rates started rising rapidly in October, and for most of November, they've remained in the mid-to-high 6% range, according to Zillow data.

Strong economic data, shifting expectations around future Federal Reserve rate cuts, and the bond market's response to the presidential election have been keeping rates high. Where they go next depends on the labor market, inflation, and how the Fed responds to new economic data.

The Fed has lowered the federal funds rate twice so far this year, and another cut may be coming in December. However, in a recent speech, Fed Chair Jerome Powell said that the Fed can afford to take its time with future cuts.

"The economy is not sending any signals that we need to be in a hurry to lower rates," Powell said. "The strength we are currently seeing in the economy gives us the ability to approach our decisions carefully."

The labor market still appears to be holding up, and inflation remains a bit above the Fed's 2% target. Additionally, many economists have concerns that some of President-elect Donald Trump's proposed policies could reignite inflation and send Treasury yields higher. This could lead to higher mortgage rates in 2025. 

What Are Today's Mortgage Rates?

What Are Today's Refinance Rates?

Mortgage Calculator

Use our free mortgage calculator to see how today's interest rates will affect your monthly payments.

By clicking on "More details," you'll also see how much you'll pay over the entire length of your mortgage, including how much goes toward the principal vs. interest.

Current 30-Year Mortgage Rates

Average 30-year mortgage rates are hovering around 6.60%, according to Zillow data. Rates increased substantially last month, averaging around 6.24% in October. 

The 30-year fixed-rate mortgage is the most popular home loan. With this type of mortgage, you'll pay back what you borrowed over 30 years, and your interest rate won't change for the life of the loan.

The lengthy 30-year term allows you to spread out your payments over a long period of time, meaning you can keep your monthly payments lower and more manageable. The trade-off is that you'll have a higher rate than you would with shorter terms, like a 15-year mortgage. 

Current 15-Year Mortgage Rates

Average 15-year mortgage rates are around 6%, according to Zillow data. In October, 15-year rates averaged 5.56%, but they've been higher in recent weeks.

If you want the predictability that comes with a fixed rate but are looking to spend less on interest over the life of your loan, a 15-year fixed-rate mortgage might be a good fit for you. Because these terms are shorter and have lower rates than 30-year fixed-rate mortgages, you could potentially save tens of thousands of dollars in interest. However, you'll have a higher monthly payment than you would with a longer term.

Current Mortgage Refinance Rates

Refinance rates are also elevated. In October, 30-year refinance rates averaged 6.35%, while 15-year refinance rates were around 5.67%. They're even higher this month.

How Much Do Mortgage Rates Need to Drop to Refinance?

If you're wondering if you should refinance now, you'll need to crunch the numbers to see if it makes sense. Some experts advise only refinancing if you can reduce your rate by a percentage point or more, but it really comes down to whether it works for your individual circumstances.

If you can save enough each month by refinancing that you can recoup your costs in a reasonable amount of time, it might be worth it. You can calculate this by dividing your closing costs by the amount you're saving on your monthly mortgage payment. So, if you paid $3,000 to refinance and were able to lower your monthly payment by $200, it would take you 15 months to break even on your refinance. 

5-Year Mortgage Rate Trends

Here's how 30-year and 15-year mortgage rates have trended over the last five years, according to Freddie Mac data.

What Factors Influence Mortgage Rates?

Mortgage rates are determined by a variety of different factors, including larger economic trends, Federal Reserve policy, your state's current mortgage rates, the type of loan you're getting, and your personal financial profile.

While many of these factors are out of your control, you can work on improving your credit score, paying off debt, and saving for a larger down payment to ensure you get the best rate possible. 

How Does the Fed Rate Affect Mortgage Rates?

The Fed increased the federal funds rate dramatically in 2022 and 2023 to try to slow economic growth and get inflation under control. Inflation has since slowed significantly, but it's still a bit above the Fed's 2% target rate.

Mortgage rates aren't directly impacted by changes to the federal funds rate, but they often trend up or down ahead of Fed policy moves. This is because mortgage rates change based on investor demand for mortgage-backed securities, and this demand is often impacted by how investors expect Fed policy to affect the broader economy. 

Fed officials lowered rates at their meetings in September and November, and they're expected to continue cutting rates at future meetings. This should help mortgage rates trend down.

Will Mortgage Rates Drop in November 2024?

Mortgage rates went up last month, but where they go next depends on a lot of unknowns, so we'll need more data to see how inflation and the labor market are trending. So far this month, rates have held relatively steady. Don't expect substantial drops in November unless the economic outlook changes.

How Low Will Mortgage Rates Go?

Mortgage rates are unlikely to drop back down to the historic lows of 2020 and 2021, when 30-year fixed rates fell below 3%. But rates are expected to continue to ease throughout the next year or two, and it's possible rates could ultimately settle in closer to 5% in a few years. 

Will Mortgage Rates Go Down in 2025? 

Most major forecasts expect mortgage rates to go down throughout 2025 as the Fed continues to lower its benchmark rate. But because mortgage rates are influenced by the economy, this forecast could change depending on how the economy evolves in 2025.