Home Loan Rates Drop: Mortgage Rates for July 10, 2024

The average interest rate on a 30-year fixed mortgage today is 6.98%, down -0.04% from 7 days ago. The average 15-year fixed mortgage rate is 6.48%, down -0.06% from last week. To see how mortgage rates are moving, see the chart below.

The Fed has been delaying rate cuts due to slow improvement in inflation. While experts still expect mortgage rates to gradually move lower in the coming months, housing market forecasts are always subject to change based on economic data, geopolitical events, and more.

Mortgage rates are constantly changing, but there’s a good chance they will fall this year. To get the lowest interest rate, shop around and compare offers from different lenders. Please enter your information below to receive a customized quote from one of CNET’s partner lenders.

About these rates: Like CNET, Bankrate is owned by Red Ventures. This tool features partner rates from lenders you can use when comparing multiple mortgage rates.

What are the different mortgage types?

Every mortgage has a loan term or payment schedule. The most common mortgage terms are 15 and 30 years, but 10, 20 and 40 year mortgages also exist. With a fixed-rate mortgage, the interest rate is set for the life of the loan, providing stability. With an adjustable-rate mortgage, the interest rate is fixed only for a certain period of time (usually five, seven, or 10 years), after which the interest rate adjusts annually based on market conditions. A fixed-rate mortgage is a better choice if you plan to stay there long-term, but an adjustable-rate mortgage may offer a lower upfront interest rate.

30-year fixed-rate mortgage

The current average interest rate for a standard 30-year fixed mortgage is 6.98%. A 30-year fixed mortgage is the most common loan term. It generally has a higher interest rate than a 15-year mortgage, but the monthly payments are lower.

15-year fixed-rate mortgage

Today, the average interest rate on a 15-year fixed mortgage is 6.48%. Although your monthly payments are higher than a 30-year fixed mortgage, 15-year loans typically have lower interest rates, allowing you to pay less interest and pay off your mortgage faster in the long run.

5/1 Adjustable Rate Mortgage

The average interest rate on 5/1 ARMs today is 6.52%. You’ll typically get a low introductory rate (5/1 ARM) for the first five years of your mortgage. But after this period, you can pay more, depending on how the rates adjust each year. If you plan to sell or refinance your home within five years, an ARM may be a good option.

What should I know about mortgage rates today?

At the beginning of the pandemic, mortgage rates were near historic lows, around 3%. That all changed as inflation began to surge and the Federal Reserve began to raise interest rates sharply in March 2022 to slow economic growth, indirectly pushing mortgage rates higher.

Now, more than two years later, mortgage rates are still around 7%. Mortgage rates have fluctuated over the past few months in response to economic data and investor expectations of when the Federal Reserve will begin cutting interest rates.

As mortgage rates rise and home prices rise, today’s homebuyers have less room in their budgets to afford the cost of a home. Limited housing inventory and low wage growth have also contributed to an affordability crisis and depressed mortgage demand.

2024 Mortgage Forecasts

Most experts predict mortgage rates will drop below 7% in the coming months. However, a continued downward trend will depend on several factors, including upcoming inflation and labor force data.

The Federal Reserve has not raised interest rates in nearly a year, but an actual rate cut does not appear to be imminent. Some experts say the first rate cut could come as early as July, although we are more likely to see the Fed cut rates in September or November.

Selma Hepp, chief economist at CoreLogic, said: “If the Fed takes any action later this year, this signal will be enough for the mortgage market that mortgage rates will start to fall.” “If that happens, we will end the year We may see mortgage rates around 6.5%.”

One thing is certain: Homebuyers won’t see mortgage rates drop overnight, and it’s unlikely mortgage rates will return to the 2-3% they were a few years ago.

Here’s where some major housing authorities expect average mortgage rates to be.

Calculate your monthly mortgage payment

Getting a mortgage should always depend on your financial situation and long-term goals. The most important thing is to create a budget and try to live within your means. The CNET mortgage calculator below can help homebuyers prepare for their monthly mortgage payment.

Where can I find the best mortgage rates?

Despite high mortgage rates and home prices, the housing market won’t remain unaffordable forever. Now is a great time to save for a down payment and improve your credit score to help you get a competitive mortgage rate when the time is right.

1. Save more on your down payment: While 20% down is not required, a larger down payment means a smaller mortgage, which will help you save money on interest.
2. Improve your credit score: A credit score of 620 is enough to qualify for a conventional mortgage, but a higher credit score of at least 740 will get you a better interest rate.
3. paying all the debts: Experts recommend a debt-to-income ratio of 36% or lower to help you qualify for the best rates. Not taking on other debt will allow you to better handle your monthly payments.
4. Research Loans and Aid: Government-sponsored loans have more flexible borrowing requirements than traditional loans. Some government funding or private programs can also help you with your down payment and closing costs.
5. Shop around for lenders: Researching and comparing multiple loan offers from different lenders can help you get the best mortgage rate for your situation.