As of Thursday, February 20, 2025, the average mortgage rates have stabilized, with the standard 30-year fixed rate holding steady at 6.92%. While these rates are higher compared to recent historic lows, the current consistency offers buyers and homeowners a chance to make well-informed decisions without the stress of rapid fluctuations in the market.
This steadier rate environment is particularly significant for potential buyers who have already adjusted their financial plans and expectations to align with the current market conditions. Instead of fixating on timing the perfect rate, prospective homebuyers can now concentrate on finding properties that meet their long-term needs.
Here are the latest average rates for mortgages:
– 30-year fixed rate: 6.92% for purchase, 6.91% for refinance
– 15-year fixed rate: 6.20% for purchase, 6.19% for refinance
– 30-year fixed jumbo mortgage rate: 6.90%
Additionally, here are some insights to secure the lowest rates on your next mortgage.
Purchase Rates for Thursday, February 20, 2025:
– 30-year fixed rate: 6.92%
– 20-year fixed rate: 6.67%
– 15-year fixed rate: 6.25%
– 10-year fixed rate: 6.08%
– 5/1 adjustable rate mortgage: 6.07%
– 10/1 adjustable rate mortgage: 6.71%
– 30-year fixed FHA rate: 7.07%
– 30-year fixed VA rate: 6.91%
– 30-year fixed jumbo rate: 6.92%
Refinance Rates for Thursday, February 20, 2025:
– 30-year fixed rate: 6.91%
– 20-year fixed rate: 6.68%
– 15-year fixed rate: 6.22%
– 10-year fixed rate: 6.09%
– 5/1 adjustable rate mortgage: 6.08%
– 10/1 adjustable rate mortgage: 6.73%
– 30-year fixed FHA rate: 7.05%
– 30-year fixed VA rate: 7.07%
– 30-year fixed jumbo rate: 6.95%
Please note that mortgage rates are influenced by various factors such as inflation rates, economic indicators, housing market trends, and the Federal Reserve’s interest rate targets. Lenders also consider personal credit scores, down payment amounts, property details, and loan terms when determining rates.
Given the daily rate fluctuations, it’s advisable to secure a mortgage rate when you are satisfied with the overall terms of your loan. Feel free to explore further details on monthly payments for different mortgage amounts and stay updated with Freddie Mac’s weekly mortgage report, which highlights the latest trends in fixed-rate mortgages.
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Weekly surveys are conducted every Thursday at noon ET to gather data on the top factors affecting mortgage rates. Even a small difference in your interest rate can lead to significant savings over the life of your mortgage. Factors influencing the rate you’re offered include the specific mortgage, upfront payments, and your overall financial health.
Your credit score plays a crucial role in securing favorable rates, with good to excellent credit typically resulting in the best offers. A higher down payment can lead to a lower interest rate and help you avoid extra costs like mortgage insurance. Different loan terms, such as 30, 20, 15, or 10 years, offer varying interest rates and monthly payments.
Mortgage rates can be fixed or variable, each with its own advantages depending on your financial goals and risk tolerance. Prequalification provides a basic estimate of what you can borrow, while preapproval offers a more detailed assessment of your financial standing for a more accurate loan amount.
Understanding how mortgage rates are influenced by factors like the Federal Reserve’s target interest rate can help you make informed decisions. Keep in mind that changes in the fed rate can impact savings products and loans, including mortgage rates. Stay informed about current market trends and consider how they might affect your mortgage rate.
Highly anticipated rate cuts by the Federal Reserve in September, November, and December 2024 set the stage for the central bank’s decision to maintain its federal funds target interest rate at 4.25% to 4.50% during its first policy meeting of 2025 on January 29. The Fed cited its focus on taming inflation, noting stable unemployment and strong labor market conditions. Despite initial expectations for more cuts, policymakers now project only two additional adjustments for the year, with uncertainty surrounding the impact of a Trump presidency.
Looking ahead to the Fed’s March 18–19, 2025, policy meeting, market projections indicate a 97.5% likelihood of rates remaining unchanged. Analysts are closely monitoring inflation and labor data, with recent reports showing sticky inflation trends and slight job market moderation. These economic indicators are likely to influence the Fed’s decisions on future rate adjustments, with Chair Jerome Powell emphasizing the current policy stance as accommodating to a robust economy.
The Federal Reserve’s rate-setting panel, led by Powell, is scheduled to announce its decision on March 19, 2025, at 2 p.m. ET.
Preview of the Upcoming Federal Reserve Meeting: What It Means for Your Finances
Settlement and Changes in Realtor Commissions
Recently, on April 23, 2024, a judge provided preliminary approval for a $418 million antitrust settlement with the National Association of Realtors. This settlement marks the end of the traditional real estate broker commissions, which could be as high as 6% of a home’s purchase price. Effective August 17, 2024, real estate agents must now furnish interested buyers with a representation agreement before showing them a property. This agreement aims to enhance transparency in the buyer-agent relationship by outlining the agent’s fees and payment structure. While this settlement is not anticipated to impact mortgage rates directly, it does open avenues for consumers to negotiate service fees with agents, potentially leading to long-term cost savings.
Insights on Mortgage Rates
Gain insights into common queries about mortgage rates to help you make informed decisions aligning with your budget and financial objectives. Explore our range of personal finance guides that offer tips on saving money, increasing earnings, and building wealth.
Understanding Mortgage Lenders
Lenders are financial institutions that provide funds to homebuyers, distinct from loan servicers who handle loan operations such as processing payments and communicating with borrowers.
Exploring Mortgage Refinancing
Mortgage refinancing involves switching from your current loan to a new lender offering improved terms and lower rates. Discover more about this process in our comprehensive refinancing timing guide.
Insight into Mortgage Rate Locks
A mortgage rate lock is a commitment from your lender ensuring your interest rate remains unchanged for a specified period, safeguarding you from market fluctuations. Learn about the best timing strategies associated with mortgage rate locks in our dedicated guide.
Eligibility for Homebuyer Assistance
Even if you have owned a home previously, you may still qualify for homebuyer assistance programs. The IRS and HUD consider individuals who have not owned a principal residence in the past three years as first-time homebuyers. Explore available programs in our homebuyer assistance guide.
Understanding Adjustable-Rate Mortgages
An adjustable-rate mortgage (ARM) features a variable interest rate, contrasting with a fixed-rate mortgage that maintains a consistent rate throughout the loan term. Learn more about ARMs and considerations for switching to a fixed-rate mortgage in our refinancing guide.
Feel free to negotiate your terms and explore options that align with your financial goals.
What is my mortgage rate? It’s not very likely that you’ll be able to determine your mortgage rate as lenders take into account market conditions and various financial factors when setting rates. However, you can inquire about potential cost-saving strategies when comparing different mortgage lenders. For example, many lenders may offer reduced rates in exchange for “mortgage points” which are upfront fees paid to the lender. A mortgage point typically costs around 1% of your mortgage amount, equating to approximately $5,000 on a $500,000 home loan. Each point can potentially lower your interest rate by about 0.25%, depending on the specific lender and loan terms. For more detailed information on securing the lowest rate for your next mortgage, refer to our comprehensive guide.
What happens to my mortgage in the event of my passing? A home mortgage is treated differently from other types of debt and is usually settled through your estate before any assets are distributed to your heirs. Most mortgages are non-transferable, meaning that the property title can only be transferred once the mortgage is fully paid off. Those individuals who are signatories to the loan are typically the ones held responsible for the mortgage debt. To gain further insights into what occurs with your mortgage after your demise, delve into our informational resources.
I already own a house. Can I leverage my home’s equity to finance a high-cost or unforeseen expense? Absolutely. Whether you require funds for home improvements, to eliminate high-interest credit card debts, or to cover an unexpected emergency, tapping into your home’s equity could provide a solution with lower interest rates, without the need for a refinance or risking your current low-rate mortgage. Generally, a good to excellent credit score and a substantial amount of built-up equity in your home are prerequisites for this option. Learn about the process of extracting equity from your home as interest rates decrease.
Editor’s note: The displayed rates are valid as of Thursday, February 20, 2025, at 6:15 a.m. ET. The Annual Percentage Yields (APYs) and promotional rates may vary depending on the region and are subject to change.
Sources:
– Mortgage Industry Insights, Bankrate. Accessed on February 20, 2025.
– Economic, Housing, and Mortgage Market Outlook – January 2025, Freddie Mac. Accessed on January 30, 2025.
– Primary Mortgage Market Survey, Freddie Mac. Accessed on February 14, 2025.
– Employment Situation Summary, U.S. Bureau of Labor and Statistics. Accessed on February 10, 2025.
– Consumer Price Index Summary, U.S. Bureau of Labor and Statistics. Accessed on February 13, 2025.
– Producer Price Index News Release Summary, U.S. Bureau of Labor and Statistics. Accessed on February 14, 2025.
– CME FedWatch Tool, CME Group. Accessed on February 20, 2025.
