Mortgage rates holding steady Nov. 24, 2025

Current mortgage rates data:

On November 21, Coins2Day examined Optimal Blue’s most recent data, which covered home loans secured by November 20. 

What's the current situation with mortgage rates in today's market?

It might seem like 30-year mortgage rates have remained around 7% for an extended period, and that perception isn't entirely inaccurate. Numerous analysts anticipated a decline in rates once the Federal Reserve began lowering the federal funds rate in September 2024, but this expectation was not met. A short-lived decrease occurred just before that meeting, only for rates to rebound swiftly afterward.

As of January 2025, the typical interest rate for a 30-year, fixed-rate mortgage surpassed 7%, marking the first occurrence since last May, based on Freddie Mac figures. This represents a significant departure from the historically low average of 2.65% observed in January 2021, a period when the government was actively working to boost the economy and prevent a recession triggered by the pandemic. 

Unless another major disaster strikes, specialists concur that we're unlikely to experience interest rates between 2% and 3% during our lives. Currently, with President Donald Trump enacting measures like tariffs and deportations, certain commentators have worried that the job market might become more competitive and inflation could resurge. Given these circumstances, American home buyers have faced elevated mortgage rates, although some managed to reduce their purchase costs by negotiating rate reductions with builders when buying new homes.

However, those looking to buy a home, or current homeowners thinking about refinancing, experienced a welcome change beginning in late August and early September of 2025. As the Federal Reserve's Sept. 16-17 meeting approached, mortgage rates began to show a clear downward trend, reflecting expectations that the central bank would lower the federal funds rate.

As anticipated, the Fed implemented the expected reduction, lowering its key interest rate by 0.25%, marking the initial decrease of 2025. Subsequently, a second reduction of the identical magnitude was enacted by Late October.

As another meeting is scheduled for December, the possibility persists of at least one further decrease in the federal funds rate throughout 2025.

Secure your best mortgage rate

Although economic circumstances are beyond your influence, your financial standing as a borrower significantly affects the mortgage interest rate you receive. Considering this, aim to accomplish the following:

• Ensure your credit is in excellent shape. The minimum credit score to get a conventional mortgage is generally 620 (for FHA loans, you may be able to qualify with a score of 580 or a score as low as 500 and a 10% down payment). But, if you’re hoping to get a low rate that could potentially save you five or even six figures in interest over the life of your loan, you’ll want a score quite a bit higher. For example, lender Blue Water Mortgage notes that a score of 740 or higher is considered top tier. 
• Keep your debt-to-income (DTI) ratio low. You can calculate your DTI by dividing your monthly debt payments by your gross monthly income, then multiplying by 100. For example, someone with a $3,000 monthly income and $750 in monthly debt payments has a 25% DTI. It’s typically best when applying for a mortgage to have a DTI of 36% or below, though you may get approved with a DTI as high as 43%.
• Get prequalified with multiple lenders. You may wish to try a mix of large banks, local credit unions, and online lenders and compare offers. Plus, getting connected with loan officers at several different institutions can help you evaluate what you’re looking for in a lender and which one will be best able to meet your needs. Just make sure when you’re comparing rates that you’re doing it in a way that’s apples to apples—if one estimate relies on you purchasing mortgage discount points and another does not, it’s important to realize there’s an upfront cost for buying down your rate with points.

Historical chart of mortgage interest rates

The current interest rates seem elevated primarily because most people remember the exceptionally low rates experienced for approximately the last fifteen years. This period was shaped by a unique confluence of historical events, including the Federal Reserve's extended duration of maintaining its benchmark rate at zero to facilitate recovery from The Great Recession, and subsequently, the extraordinary measures implemented during the nation's fight against the worldwide Covid-19 pandemic.

With the economy stabilizing, experts concur that interest rates as low as we've seen are improbable in the future. Considering the broader historical context, rates near 7% aren't considered unusually elevated. 

Looking at a St. Louis Fed chart that uses Freddie Mac data for the average 30-year, fixed-rate mortgage reveals that rates around 7% were typical during the 1990s. When contrasted with rates from the 1970s and 80s, 7% seems quite favorable. For instance, mortgage interest rates exceeded 18% in September, October, and November of 1981.

The historical backdrop offers little solace to property owners eager to relocate but feeling trapped by an unprecedentedly low interest rate. This scenario is so prevalent in today's market that the pandemic-era's low rates, which are preventing homeowners from moving when they otherwise would, have been dubbed the “golden handcuffs.”

Elements influencing mortgage interest rates

Mortgage interest rates are primarily influenced by the U.S. Economy's present condition. Lenders tend to increase mortgage rates to safeguard their future earnings if they anticipate inflation. 

A significant overarching consideration is the nation's debt. When the federal government incurs substantial deficits and must borrow funds to cover the shortfall, this can lead to increased interest rates.

The need for home financing is significant. When there's less demand for loans, financial institutions might reduce interest rates to draw in more individuals seeking to borrow. Conversely, strong demand can prompt lenders to increase rates, helping them offset the expenses associated with processing a greater number of loan applications.

Furthermore, the Federal Reserve's actions warrant consideration. The Fed possesses the ability to affect interest rates on financial products, including mortgages, by either choosing to raise or lower the federal funds rate, or by implementing specific measures concerning its balance sheet.

The federal funds rate garners considerable media focus, as changes to this benchmark rate—the cost for banks to borrow from one another overnight—frequently align with shifts in mortgage and other credit interest rates. However, the Fed doesn't directly dictate rates for mortgages or similar products, and these rates don't invariably mirror the fed funds rate.

The Fed also impacts mortgage rates by managing its balance sheet. During economic downturns, the central bank purchases financial assets, adding them to its balance sheet and thereby injecting liquidity into the economy. Mortgage-backed securities (MBS) are a significant asset class for The Fed in these circumstances. 

However, the Fed has been slimming down its balance sheet, allowing assets to mature without buying new ones to replace those that have aged off it. That puts an upward pressure on mortgage interest rates. In other words, even though a lot of attention is focused on when the central bank decides to cut or hike the federal funds rate, what the Fed does with its balance sheet may be even more important for those hoping to snag a lower mortgage rate. 

Compare mortgage rates: why it matters

To secure the most suitable mortgage, it's crucial to compare interest rates across various loan types and explore options with multiple financial institutions.

If your credit history is excellent, a traditional mortgage could be your ideal option. However, if your score falls below 600, an FHA loan might offer an opportunity that a conventional loan wouldn't.

Exploring options with various banks, credit unions, and online lenders can significantly impact your overall payment. Freddie Mac's findings indicate that during periods of elevated interest rates, prospective homeowners might reduce their yearly expenses by $600 to $1,200 by obtaining quotes from several mortgage providers.