The average mortgage purchase rates have remained steady as of Monday, June 16, 2025, with the 30-year fixed benchmark holding at 6.90% following last week’s stable inflation readings. Analysts suggest it’s premature to gauge the impact of tariff-related pressures on prices. The Federal Reserve is poised to begin its fourth rate-setting session of the year tomorrow. Traders anticipate a 95% likelihood that the Fed will maintain the federal funds target interest rate between 4.25% and 4.50% on Wednesday, despite pressure from President Trump on Fed Chairman Jerome Powell to lower rates. While mortgage rates are not directly linked to the Fed rate, they are influenced by similar economic factors considered by the Fed in its policy decisions, such as inflation and employment trends.
If you are considering entering the housing market this summer, it is advisable to start exploring mortgage options from various lenders. Request quotes for conventional, FHA, VA, and other common home loans to evaluate your affordability. The current average rate for a 30-year fixed mortgage is 6.89% for purchase and 6.90% for refinance, showing a slight increase and decrease respectively compared to the previous week. Rates for a 15-year mortgage are at an average of 6.06% for purchase and 6.16% for refinance, with a minor decline from the previous week’s figures. The average purchase rate for a 30-year fixed jumbo mortgage is 6.89%.
Mortgage rates are influenced by various factors, including inflation, economic conditions, housing market trends, and the Federal Reserve’s target interest rate. Lenders also consider individual credit scores, down payment amounts, the property in question, and other loan terms. Since rates can fluctuate daily, it is recommended to lock in a mortgage rate once you are comfortable with the terms of your loan.
In a recent report by Freddie Mac, the average rate for a 30-year fixed-rate mortgage is 6.84%, slightly lower than the previous week. The fixed rate for a 15-year mortgage is 5.97%, also showing a slight decrease. These rates are lower than a year ago, indicating a stable trend in mortgage rates. Sammy Khater, Freddie Mac’s chief economist, notes that rates have remained relatively steady in recent months, supported by improving inventory and slower house price growth.
“Combining growth and encouragement, we celebrate National Homeownership Month. Freddie Mac updates its Prime Mortgage Market Survey data weekly on Thursdays at noon ET. Here are four key factors that impact your mortgage rate:
1. Credit score: Your credit score plays a crucial role in determining your mortgage rate. Borrowers with good to excellent credit scores typically receive the best rates, while those with fair credit may still find decent options available.
2. Down payment: A larger down payment can lead to a better interest rate. Putting down at least 20% of the home’s purchase price upfront can result in lower rates and help avoid mortgage insurance costs.
3. Loan term: Mortgage terms vary, with options ranging from 10 to 30 years. Shorter terms often come with lower rates but higher monthly payments, while longer terms may have lower monthly payments but higher total interest costs.
4. Interest rate type: Mortgages can have fixed or variable rates. Fixed-rate mortgages offer stability with a consistent rate, while adjustable-rate mortgages (ARMs) start with a fixed rate that later adjusts based on market conditions.
Understanding prequalification and preapproval:
– Prequalification provides a basic estimate of your borrowing capacity.
– Preapproval involves a detailed financial review to offer a more precise lending amount.
When considering mortgage rates, it’s important to monitor changes influenced by the Federal Reserve’s actions. As the Fed rate increases, mortgage rates typically follow suit.
For more insights on navigating mortgage rates and the homebuying process, check out our comprehensive guide. Stay informed and make empowered decisions as you embark on your homeownership journey.”
In 2023, in response to record-high inflation following the pandemic, the Federal Reserve made significant interest rate cuts, reducing the federal funds target rate by 0.5% in September and 0.25% in both November and December. On May 7, 2025, the Fed decided to keep the rate unchanged at 4.25% to 4.50% for the third time in a row, aiming to support employment and manage inflation at 2%. The Fed acknowledged stable employment levels but noted increased economic uncertainty and pledged to carefully monitor data and risks for future adjustments. The Fed’s projections indicate a more cautious approach with only two anticipated rate cuts in 2025, reflecting concerns about slower growth and rising inflation.
Looking ahead to the next Federal Reserve policy meeting on June 17–18, 2025, market expectations suggest that rates will remain steady at the current range. Analysts are closely monitoring inflation and labor market reports for insights into potential future rate adjustments. Recent job data showed modest growth, while inflation ticked up slightly, prompting concerns about the impact of tariff policies and potential supply shocks. Fed Chair Jerome Powell cautioned about future inflation challenges and highlighted the Fed’s upcoming decision on June 18, 2025, as a crucial event for the economy and monetary policy.
For more information on the Federal Reserve’s upcoming meetings and how it may impact your finances, and additional articles on mortgages and homebuying, visit our website.
What is a mortgage rate lock and how can you refinance your ARM into a fixed-rate mortgage? Explore frequently asked questions about mortgage rates to understand how mortgages work and find the best option for your budget and financial goals. Check out our collection of personal finance guides to help you save money, earn money, and grow your wealth.
Mortgage lenders are financial institutions that provide loans to homebuyers. They differ from loan servicers, which manage the operational tasks of your loan such as processing payments and communicating with borrowers.
Refinancing a mortgage involves switching your current loan to another lender for better rates and terms. The new lender pays off your old mortgage, and you make monthly payments to the new lender. Learn more about the refinancing process in our guide on timing your refinancing.
Even if you have owned a home before, you may still qualify for homebuyer assistance programs. The IRS and HUD consider you a first-time homebuyer if neither you nor your spouse has owned a principal residence in the past three years. Discover available programs in our homebuyer assistance guide.
An adjustable-rate mortgage (ARM) is a type of home loan with a fluctuating interest rate. Unlike fixed-rate mortgages, ARMs start with a fixed rate for a specified period before adjusting to a higher rate periodically for the remaining loan term. Find out how to convert your ARM to a fixed-rate mortgage in our refinancing guide.
While negotiating your mortgage rate may not be likely, you can inquire about reducing costs through other means when comparing lenders. Some lenders offer lower rates in exchange for upfront fees called “mortgage points.” Learn more about securing the lowest rate in our mortgage rate guide.
After your passing, your home’s mortgage is handled differently from other debts. Typically, mortgages must be paid off in full before transferring the property title, and only those who signed on to the loan are liable for the debt. Learn about the implications of your mortgage after death.
If you already own a home, you may be able to borrow against it.
Are you considering using your home’s equity to cover a significant or unforeseen expense? Yes, accessing the cash value tied up in your home can be a smart way to finance home improvements, pay off high-interest credit card debt, or address emergencies. By leveraging your home’s equity, you can access funds at lower interest rates without the need to refinance and without losing your current favorable mortgage rate. To qualify for this option, you typically need a good to excellent credit score and must have accumulated sufficient equity in your home. Find out how you can tap into your home’s equity while interest rates are favorable.
Editor’s note: The rates mentioned were current as of Monday, June 16, 2025, at 6 a.m. ET. Please note that APYs and promotional rates may vary depending on the region and are subject to change.
Sources:
– Mortgage Industry Insights, Bankrate. Accessed June 16, 2025.
– Primary Mortgage Market Survey, Freddie Mac. Accessed June 13, 2025.
– Employment Situation Summary, U.S. Bureau of Labor Statistics. Accessed June 9, 2025.
– Consumer Price Index Summary, U.S. Bureau of Labor Statistics. Accessed June 12, 2025.
– Producer Price Index News Release Summary, U.S. Bureau of Labor Statistics. Accessed June 13, 2025.
– CME FedWatch Tool, CME Group. Accessed June 16, 2025.
