Understanding 30-Year Mortgage Rates: A Comprehensive Guide (2024)

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Thinking about getting a mortgage soon and want to know how rates are trending? See where 30-year mortgage rates are today and if a 30-year mortgage makes sense for you.

Overview of 30-year mortgage rates

The 30-year fixed-rate mortgage is by far the most popular type of home loan. Because the terms on these mortgages are so long, borrowers who get a 30-year mortgage enjoy low monthly payments — though they'll ultimately pay a lot more in interest over the life of the loan.

Your mortgage rate has a direct impact on how much you'll pay each month for your home. Average rates change from day to day and even hour to hour based on larger economic trends. The rate you pay depends on both those larger economic factors as well as your individual financial circ*mstances. A mortgage lender will consider your credit score, down payment, debt-to-income ratio, and the type of loan you're getting when determining what rate to give you.

Current trends in 30-year mortgage rates

In the past couple of decades, it was pretty common to see 30-year rates in the 5% to 6% range. Pre-2000, rates were even higher, sometimes reaching double digits. During the pandemic, rates reached historic lows, at times dropping below 3%.

Rates have risen dramatically from the historic lows of the pandemic, and they trended up throughout most of last year as well.

But in recent months, rates have finally been dropping. In July, the average 30-year fixed mortgage rate was 6.45%, which is 13 basis points down from the previous month, according to Zillow data. Rates have been trending even lower in August.

Overall, mortgage rates are expected to continue to go down this year. And we could see them fall further in 2025.

30-year mortgage rates today

Check out the latest new mortgage and mortgage refinance rates to see how today's 30-year mortgage rates compare. To learn more about refinancing, check out our page on 30-year refinance rates.

Factors influencing 30-year mortgage rates

Federal Reserve policies

The Fed can have a big, if indirect, impact on mortgage rates.

The Fed makes changes to the federal funds rate to either encourage or slow economic growth. When the Fed lowers this rate, the price to borrow money generally goes down, boosting economic activity. When the Fed raises this rate, the price to borrow goes up, curbing economy activity.

Mortgage rates aren't directly linked to the federal funds rate, but they're often pushed up or down based on how investors expect Fed moves to impact the broader economy.

For example, mortgage rates are high right now in part because the Fed is keeping its benchmark rate high to bring down inflation. Once Fed officials believe that inflation has been effectively managed, they'll likely start to lower this rate. This will remove a lot of upward pressure off of mortgage rates and allow them to trend down.

Inflation

When inflation is high, the Fed tries to control it by increasing interest rates. That puts upward pressure on borrowing costs across the board. Everything from mortgages to credit cards and auto loans end up costing more. Conversely, when the Fed reduces rates, consumer borrowing costs decline.

Bond market movements

Mortgage rates are heavily influenced by investor demand for mortgage-backed securities. MBSs and bonds are generally considered to be safer investments and thus attract similar investors, so you can get an idea of where mortgage rates might be headed based on how the bond market is trending.

Mortgage rates typically follow the yield on a popular government bond called the 10-year Treasury.

Comparing 30-year vs. 15-year mortgage rates

The 15-year fixed-rate mortgage is another popular loan term, and it's a good choice if you want to pay your mortgage off faster and spend less on interest over the life of your loan. Average 15-year mortgage rates are lower than rates on mortgages with longer terms.

To see the difference between what you'd pay on a 30-year mortgage compared to a 15-year mortgage, take a look at this example for a $250,000 loan, using average interest rates for the week of August 22, according to Freddie Mac data:

As you can see, the 30-year fixed-rate mortgage has a significantly lower monthly payment. However, you'll pay a lot more in interest over the life of the loan than you would with a 15-year fixed-rate mortgage.

But if keeping your monthly costs down is a priority, the 30-year mortgage would likely be the better fit.

The pros and cons of 30-year fixed mortgages

Pros

• If mortgage rates increase, then you keep your low rate. Unlike an adjustable mortgage, a fixed mortgage locks in your rate for the entire life of your loan.
• Make low monthly payments. Payments on 30-year mortgages are low compared to shorter terms, because you're spreading payments out over a longer period of time.
• Predictable payments can make it easier to plan a budget. Your interest rate will stay the same from year to year, which could make it easier for you to plan out your monthly expenses overall.

Cons

• If mortgage rates decrease, then you're stuck with the higher rate. Locking in your rate for 30 years means you don't benefit should rates go down later.
• Shorter terms offer lower rates. You may prefer a 20-year or 15-year fixed term if you can afford higher monthly payments, because you'll land a lower rate.
• You'll pay more in interest in the long term. A higher rate isn't the only reason you'll pay more with a 30-year term than with a shorter term. Your interest has more time to accumulate, so interest payments add up over time.

How to secure the best 30-year mortgage rate

Improve your credit

Lenders take your financial profile into consideration when determining an interest rate. The better your finances are, the lower your rate will be.

• Credit score: Most mortgages require a minimum 620 credit score, and an FHA loan lets you get a mortgage with a 580 score. But the higher your score is, the better. To improve your score, try making payments on time, paying down debts, and letting your credit age.
• Down payment: Depending on which type of mortgage you take out, a lender might require anywhere from 0% to 20% for a down payment. But the higher your down payment is, the lower your rate will likely be.
• Debt-to-income ratio: Your DTI is the amount you pay toward debts each month in relation to your monthly income. You generally can't get a mortgage with a DTI above 50%, and you can land a lower rate with a lower DTI ratio. To decrease your DTI ratio, you either need to pay down debts or earn more money.

Shop around

Get rate quotes from multiple mortgage lenders to be sure you're getting the best possible deal. You may also want to ask lenders about the different types of mortgages they offer, and what kind of rate you might get with different loan types. For example, government-backed mortgages often come with lower rates than conventional loans.

Consider timing

Having a strong financial profile can make a big difference in the mortgage rate you'll pay, but so will the larger economic factors that impact average rates.

If you're flexible on when you get your mortgage, check out the latest mortgage rate forecasts to see if rates are likely to rise or fall soon. You can also get an idea of where rates might go in the near future by keeping an eye on the latest inflation data and seeing whether the Fed is expected to raise or lower rates at its upcoming meetings.

Use our free mortgage calculator to see how today's 30-year rates will affect your monthly payments and long-term finances.

Is a 30-year fixed mortgage a good fit for you?

You'll probably like a 30-year fixed mortgage if you want relatively low monthly payments.

You might prefer a shorter term if you want to be aggressive about paying off your mortgage faster, and if you can afford higher monthly payments. If you're refinancing, you might consider a 15-year mortgage refinance to lower your interest costs.

You don't necessarily need to stay in a home for 30 years to benefit from a 30-year mortgage. Even if you plan to move in a few years, you can benefit from the low monthly payments.

You may prefer an adjustable-rate mortgage if you can get a significant discount compared to current fixed rates, but be sure to understand how much your monthly payment could increase down the road when the rate adjusts.

30-year mortgage rates FAQs