A guide to current mortgage rates

Current average APRs and weekly mortgage rate analysis

Derek Silva

Derek Silva

Published March 23, 2020

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  • The coronavirus pandemic has disrupted the economy and driven down the stock market

  • Rates are low, but increased last week because demand for mortgages is very high

The rapid spread of the latest coronavirus (officially called COVID-19) in the U.S. has led to the biggest single-day stock market declines in 33 years. However, 30-year fixed-rate mortgage rates actually rose for the second week in a row, with many mortgage lenders keeping prices up as they struggle to handle a major increase in mortgage applications. The takeaway for homebuyers hasn’t changed: it’s generally a good time to get a mortgage because rates are historically low.

Current average mortgage rates

Mortgage typeThis week's APRLast week's APRChange from last week
30-year fixed-rate mortgage3.65%3.36%+0.29%
15-year fixed-rate mortgage3.06%2.77%+0.29%
5/1 ARM (5-year adjustable-rate mortgage)3.11%3.01%+0.10%

The mortgage rates this week are up for all types of mortgages, on par with what they were in early January of this year. However, now is generally still a good time to get a mortgage for many people because mortgage rates are low and home prices could rise later in the year. Average mortgage rates right now are 3.65% for 30-year fixed-rate mortgages. This is a substantial increase from the all-time low rate of 3.29% two weeks ago. The average rate for 15-year fixed-rate mortgages is 3.06%, also a marked increase from both last week and two weeks prior.

Try our free mortgage calculator to see how much of a mortgage you can afford based on the current mortgage rates.

Now is also a good time to consider a mortgage refinance if current rates are lower than your current mortgage. Even a few tenths of a percent can lower your monthly payments and save you hundreds or thousands of dollars over the lifetime of the loan.

Today’s mortgage rate analysis

The primary factor affecting mortgage rates (and the overall economy) right now is the spread of COVID-19, which stands for coronavirus disease 2019. Mortgage rates are expected to stay low as the U.S. economy continues to slow down, but rates for all mortgages still went up in the past week because there is very high demand for new mortgages right now.

Here are four mortgage rate factors we’re monitoring this week:

  • The spread of COVID-19
  • Increasing demand for mortgages
  • The U.S. economy and a possible recession
  • Presidential primary election results

How is the coronavirus affecting mortgage rates?

The spread of COVID-19 is having a big impact on mortgage interest rates right now because it is disrupting the U.S. economy, lowering business profits, and driving down the stock market.

The World Health Organization (WHO) labelled COVID-19 a pandemic because of how quickly it is spreading. (The term pandemic doesn’t refer to the severity of the disease.) Hospitals in highly affected areas are running out of ventilators and masks, while Congress struggles to agree on an emergency relief plan. Thus far, there have been 428 deaths from COVID-19 in the U.S. and more than 30,000 confirmed cases across all 50 states and Washington D.C., according to the New York Times.

The spread of COVID-19 has disrupted stock and bond markets, leading to record declines. A falling stock market normally results in a stronger bond market, but even that has struggled. The U.S. 10-year Treasury note (bond) market has been at an all-time low, and failed to rise even after the Fed announced a new plan to promote financial stability. More than any other factor, mortgage rates historically follow the 10-year Treasury note, hinting that mortgage rates will also stay near their record lows.

Learn more about protecting yourself with this coronavirus guide from the CDC (hint: wash your hands regularly).

Mortgage demand is keeping rates from dropping

Even with the stock market struggling and bond prices going down, the current average mortgage rates for 30-year and 15-year FRMs and 5/1 ARMs are up significantly from last week because demand for mortgages is very high right now. Mortgage lenders have been struggling to keep pace with the huge uptick in applications, and some lenders are increasing their rates to slow down the flow of new applications.

As rates have increased, mortgage applications have fallen again. According to the Mortgage Bankers Association, mortgage applications decreased 8.4% since last week. Whether this is due to financial uncertainty on the part of home shoppers or to the week-over-week increase in interest rates remains to be seen.

Previously, mortgage applications had increased 55.4% after the rates hit all-time lows two weeks ago. That’s the biggest increase in new applications since 2009. Mortgage refinance applications had also increased by 79%, the largest one-week increase in refinance applications since 2008. (Check out our guide to refinancing your mortgage.)

How the U.S. economy is affecting mortgage rates

The U.S. economy has been strong in the past few years, but a big part of its strength is stock market growth. Because of the spread of COVID-19, the U.S. economy is undergoing a severe economic decline and possibly an extended recession. A slowed economy could keep mortgage rates near all-time lows.

How the stock market is doing

The stocks continue to fall, even with new aggressive action by the Federal Reserve. The Dow Jones Industrial Average and S&P 500 have both gone into a bear market, meaning they are each at least 20% below their recent highs. The Dow has fallen 28% since its peak on February 12, with the S&P 500 falling more than 30% since its peak on February 19.

On March 23, the Dow reached the lowest average in three years.

Learn how to weather a bear market.

Another impact of the coronavirus is that stock markets are becoming more volatile. Over the past month, the Dow Jones Industrial Average has experienced both its biggest single-day gain and loss. The price of gold, which is usually seen as a safer investment during a bear market, has not gone up in accordance with a stock market panic. In fact, the gold has lost value.

How the rest of the U.S. economy is doing

At this point, most industries in the U.S. have been affected by the coronavirus spread, including the airline, automobile, film, manufacturing, and travel industries. The retail industry could be hit especially hard because of both supply issues and lower demand as more Americans stay indoors. Local businesses and restaurants in areas affected by COVID-19 have seen a decline in business. Sports leagues are also being affected: the NCAA cancelled March Madness and the NHL, MLS, and NBA suspended their seasons.

How the federal government is responding

The federal government’s proposed stimulus package has reached a stalemate in the Senate, with Democrats asking for more unemployment aid and worker protections. The proposed $1.8 trillion plan includes business loans and $1,200 in direct payments to Americans suffering severe financial losses because of the pandemic.

Today the Federal Reserve also announced a new bond-buying program to help promote stability and functioning of market systems. The Fed plans to buy over $500 billion in Treasury Bills and over $200 billion in mortgage-backed securities.

On March 15 the Federal Reserve cut its interest rate to zero in an attempt to encourage borrowing and fend off a potential economic downturn. This was the second emergency rate cut in the past two weeks. The previous one was the first emergency rate cut by the Fed since the Great Recession.

If the U.S. fails to contain the spread of COVID-19, the severity of the downturn will only increase. Furthermore, if the U.S. takes more drastic measures to combat the spread — like further travel restrictions — a recession could also result.

The presidential election and mortgage rates

Whoever wins the Democratic party’s presidential nomination will have an impact on the stock market, which could indirectly impact mortgage rates. The stock market saw slight gains after primary election victories for Joe Biden, even though gains were quickly wiped out.

All things being equal, a Biden win will most likely boost the stock market in the short term. A win by Sen. Bernie Sanders of Vermont will probably lead to stock market declines because investors worry that he will increase corporate taxes and make big moves to regulate Wall Street and the health insurance industry.

In the near future, any stock market gains from the primaries may be quickly wiped out by COVID-19 fears, but the ultimate nominee’s success in the November general election will also have a big impact. Another Trump victory could spur the stock market higher and mortgage rates under Trump could increase. A Democratic victory could do the opposite because big businesses may fear new regulations and tax increases. When Barack Obama won the presidency in 2008, mortgage rates fell significantly, from 6.20% down to 4.96% over the next two months, though the Great Recession also impacted rates at that time.


A mortgage makes a house your own. Insurance protects it.

Policygenius can help you find a homeowners insurance policy that fits your needs and your budget.

How to find the best mortgage rates

A mortgage is a big financial decision, so it’s important to make the best decision you can. Here are four steps to help you find the best mortgage:

  • Get your credit score as high as you can before applying for a loan
  • Figure out what kind of mortgage you need
  • Compare mortgages from multiple lenders
  • Make as big of a down payment as you can

Maximize your credit score

Mortgage lenders use your credit score to determine what rates they will offer you. In particular, they look at your FICO score and a higher score will get you better rates. That’s why it’s important to do as much as you can to increase your credit score before you apply for any new loans.

You can’t magically increase your FICO score, but you can take concrete steps, like carrying the smallest balance you can and not opening any new credit cards before a mortgage application.

Learn more about what a good credit score is and how to get the best credit score.

Know what type of mortgage you need

There are multiple types of mortgages. Which you should get depends on your financial situation.

For example, FHA loans are backed by the government. They make it easier for low-income individuals and first-time homebuyers to get a mortgage. But a conventional mortgage loan (meaning a private instead of government loan) could save you money if you can afford to make a bigger down payment.

In certain circumstances, you may also want to consider a mortgage with an adjustable rate, instead of a traditional mortgage with a fixed rate. People who want to pay off debt more aggressively may opt for a 15-year or 20-year mortgage over the standard 30-year loan.

Learn more about the types of mortgages and which is best for you.

Compare rates from multiple lenders

Like any other purchase, you should shop around before getting a mortgage. Keep in mind that a mortgage rate is expressed as an annual percentage rate, or APR for short. Annual percentage rates reflect the lender’s interest rate, but they are also affected by other lender costs, such as points. (Learn more about what APR is.)

If you are a customer at a local bank or credit union, make sure to ask what kind of rates they can offer. Sometimes long-time customers receive preferential rates.

Make the right down payment

For conventional loans, the more you put as a down payment, the smaller your monthly payment and overall mortgage costs will be. This is a big deal because the longer your mortgage, the more you will have to pay in mortgage interest. Over the term of a mortgage, interest can cost nearly as much as the mortgage principal itself.

If you make a down payment of less than 20%, you will also have to pay private mortgage insurance (PMI). The closer your down payment is to 20%, the more you can save on PMI.

With that being said, very few people can afford a 20% down payment and it likely isn’t worth doing something like withdrawing from a retirement account just to reach that 20%. The key then is to make the biggest down payment you can, without overextending yourself, and without hurting other savings goals, like saving for retirement. You will no longer have to pay PMI once you have 20% home equity (the value of your home minus your remaining mortgage balance).

Also, make sure to set aside some money to pay cover closing costs and other unexpected costs of owning a home.

What influences mortgage rates

There are a number of factors that determine current mortgage rates, only some of which you can control.

In general terms, mortgage rates are lower (and better for homebuyers) when the economy is struggling or when the economic outlook is not good. That’s because investors look for safer, longer-term investments when they think the economy is on the decline. For example, they buy more 10-year Treasury notes instead of short-term notes (this is what economists are referring to when they talk about the yield curve inverting).

Investors also buy more mortgage-backed securities (MBSs) when the economy isn’t doing well. An MBS is a collection of individual mortgages, and people can trade them on the market the same way they trade bonds. Higher demand for MBSs leads to lower prices, which lead to more buying and even lower prices.

Banks and other mortgage lenders can offer lower mortgage rates to customers when investors are buying more MBSs. On the other hand, less demand for MBSs can lead to an increase in mortgage rates.

Mortgage rate factors you can control

What specific rates a lender offers you depend largely on your credit score and other details like the amount and type of the loan. These are factors you can influence (to a degree). You can take steps to improve your credit score. You can also ask for a smaller loan by choosing a house you can afford and then making the biggest down payment you can afford.

Lenders often look closely at your loan-to-value ratio (LTV ratio). This is the amount of the loan as a percentage of the home’s value. If you get a $180,000 mortgage for a $200,000 home, the mortgage (and your LTC ratio) is 90%. LTV ratios above 80% are seen as more risky and result in higher rates.

Understand your monthly mortgage payment better by looking at your mortgage amortization schedule.

Mortgage rate factors that are out of your control

General economic factors have a big impact on mortgage rates. This includes things like the strength of the job market, the inflation rate, and the state of the overall housing market. International economies and U.S. trade relations also impact mortgage rates.

With something like employment numbers, the biggest impact to mortgage rates comes when the data in government reports don’t match expectations. Regardless of whether or not the numbers are good or bad, changes in mortgage rates usually come when the numbers differ greatly from what investors predicted they would be.

The Federal Reserve also sets the interest rates for banks and other financial institutions to lend money to each other, which is called the federal funds rate. These financial institutions attach a premium to the federal rate to come up with their own lending rate: the prime rate.

Using the prime rate as a benchmark, lenders and financial institutions then offer a range of loan rates to consumers. For example, you may be able to get a rate below 4% even if the average national mortgage rate is 4.05%. At the same time, you may have to pay a higher rate.

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