Current Mortgage Rates Across States - 16th May, 2025
Affordable digs in these states won't burn a hole in your pocket! The seven states with the lowest 30-year new purchase mortgage rates as of today are New York, California, Florida, Texas, Georgia, Michigan, and North Carolina. These budget-friendly locales have averages ranging between 6.85% and 7.02%.
On the flip side, dwellings in the priciest locations can put quite the dent in your savings account. The states with the priciest mortgage rates currently include Alaska, West Virginia, Wyoming, South Dakota, Vermont, Iowa, Montana, North Dakota, and Washington D.C. Worry not! These high-end locations offer averages between 7.10% and 7.17%.
The mortgage market takes a whirlwind tour of fluctuations due to various factors. State-specific differences in credit scores, average loan sizes, and regulations can impact rates, as local lenders aim to minimize risk. Keep shopping around for the best mortgage deal, and don't forget to compare rates regularly, no matter the nature of your home loan quest.
Note that the rates you'll see published don't necessarily match teaser rates you might find advertised online. Teaser rates are often cherry-picked to show the most attractive offer, sometimes requiring points or basing rates on exceptional credit scores or smaller-than-average loans. The actual rate you secure will depend on your personal credit score, income, and other factors.
National Mortgage Rate Averages
As of today, the 7.04% average for 30-year new purchase mortgages saw a dip by 3 basis points. This is slightly better than mid-April, when rates surged to a high of 7.14% – the most expensive level since May 2024. However, rates plunged to a 2025 low of 5.89% in September and dropped to a two-year low of 6.50% in March.
Compare Current Mortgage Rates Today - May 16, 2025 Use our Mortgage Calculator to see monthly payments for different loan scenarios based on home price, down payment, loan term, property taxes, homeowners insurance, and interest rate.
What Factors Influence Mortgage Rates?
A swirl of macroeconomic factors and industry elements coalesce to determine mortgage rates:
- Bond Market and 10-Year Treasury Yields:
- Typically, 30-year mortgage rates align with the yield on the 10-year U.S. Treasury bonds, as investors compare the returns[2].
- Higher demand for U.S. Treasuries can lead to lower Treasury yields, which, in turn, may cause mortgage rates to fall[1].
- Federal Reserve Policies:
- The Federal Reserve's policies indirectly impact mortgage rates, especially changes in the federal funds rate[4].
- Inflation attempts by the Fed can increase interest rates and mortgage rates as borrowing costs rise across the board[5].
- Economic Indicators:
- Strong economic growth and job creation may contribute to higher interest rates as the Fed seeks to curb inflationary pressures[4].
- Higher inflation can also lead to increased interest rates, as the Fed works to control economic growth[5].
- Lender Competition:
- Competition among lenders can create fluctuations in rates, as providers adjust offerings to win borrowers[3].
- Mortgage-Backed Securities (MBS):
- Changes in investor demand for MBS affect mortgage rates, since these securities closely resemble bonds[5].
- Personal Finances and Property Type:
- Credit scores, down payments, debt-to-income ratios, and property type may influence the mortgage rate offered by lenders[5].
[1] Zillow. (2021). How are mortgage rates determined? Retrieved March 25, 2023, from https://www.zillow.com/mortgage-rates/housing-market-news/235544/[2] The Balance. (2022). Why Do Mortgage Rates Move with the 10-Year Treasury Yield? Retrieved March 25, 2023, from https://www.thebalance.com/mortgage-rates-10-year-treasury-yield-mortgage-bonds-1289094[3] Bankrate. (2023). How mortgage rates are determined. Retrieved March 25, 2023, from https://www.bankrate.com/mortgage/rates/how-mortgage-rates-are-determined/[4] Federal Reserve Bank of St. Louis. (2023). Why does the fed funds rate affect mortgage rates? Retrieved March 25, 2023, from https://www.stlouisfed.org/on-the-economy/2022/may/why-does-the-fed-funds-rate-affect-mortgage-rates[5] Money Under 30. (2023). Why do mortgage rates change? Retrieved March 25, 2023, from https://www.moneyunder30.com/why-do-mortgage-rates-change
- In the fluctuating mortgage market, personal factors such as credit scores, income, and savings also play a role in determining the interest rate on a mortgage, affecting one's personal-finance management and long-term investing goals.
- Tokenized assets and Initial Coin Offerings (ICOs) have introduced new avenues for investing, but the adoption of these alternative finance methods in real-estate transactions is still in its infancy, leading to regulatory uncertainties and potential risks for investors.
- Given the various factors impacting mortgage rates, it pays to be well-informed before making a decision on home trading or home financing, as understanding these dynamics helps minimize risks and secure the best rates possible.
- As for investment strategies, diversifying one's portfolio with a mix of traditional and alternative assets like real-estate tokenized securities can help balance out risks and maximize long-term returns in a rapidly evolving market landscape.
