Mortgage Rates Update May 2023: 30-Year Loans Near 7% - Jumbo Loans Hit 12-Year High

Mortgage rates continue their upward trend with jumbo 30-year loans hitting a 12-year high.

On Monday, mortgage rates experienced a moderate increase across most loan types. The 30-year fixed mortgage rate edged closer to the significant 7% mark, while jumbo 30-year loan rates surged to levels not seen since October 2011.

National Mortgage Rate Averages Today

The 30-year fixed mortgage rate has risen for three consecutive days, adding a modest total of 0.125 percentage points. Monday alone saw a 0.05% increase, bringing the average to 6.93%. This rate fluctuates between a five-month low of 6.11% recorded in February and a 20-year peak of 7.58% reached last October.

The 15-year fixed mortgage rate climbed 0.09% on Monday, settling at 6.16%. This figure sits midway between February’s five-month low of 5.23% and a 15-year high of 7.03% from October.

Jumbo 30-year mortgage rates added 0.12% Monday, continuing the upward momentum from a 0.13% rise on Friday. The cumulative 0.25% increase has pushed jumbo rates back to 6.27%, matching the highest level seen in 12 years.

Refinancing rates also rose on Monday: the 30-year refinance average increased by 0.04%, the 15-year refinance rate by 0.06%, and the jumbo 30-year refinance rate surged 0.12%. Currently, refinancing a 30-year mortgage costs approximately 0.35% more than initiating a new 30-year purchase loan.

Following historic lows in August 2021, mortgage rates climbed sharply through early 2022. The 30-year average peaked at 6.38% in mid-June 2022, nearly 3.5 percentage points above the summer 2021 bottom of 2.89%. Rates then spiked further last fall, surpassing the June peak by 1.2 percentage points.

Important Considerations

The mortgage rates presented here reflect average offers from top lenders and may differ from promotional teaser rates advertised online. Such advertised rates often require upfront points or apply only to borrowers with exceptional credit profiles or smaller loan amounts relative to home value.

Use our Mortgage Calculator to estimate monthly payments across various loan scenarios.

Lowest Mortgage Rates by State

Mortgage rates vary by state due to differences in local credit scores, typical loan sizes, and lender risk policies. Below is a map showing the lowest current rates offered by lenders in each state, based on an 80% loan-to-value ratio and borrower credit scores between 700 and 760.

What Drives Mortgage Rate Changes?

Mortgage rates are influenced by a complex mix of factors including bond market trends, especially the 10-year Treasury yield; Federal Reserve monetary policy; and lender competition. Because multiple forces act simultaneously, pinpointing a single cause for rate movements is challenging.

Throughout much of 2021, mortgage rates remained low due to the Federal Reserve’s substantial bond-buying programs responding to pandemic-related economic challenges. This bond-buying, more than the federal funds rate, played a key role in keeping borrowing costs down.

Starting November 2021, the Fed began tapering these bond purchases, reducing them monthly until ceasing in March 2022.

The Federal Open Market Committee (FOMC), which sets monetary policy, meets approximately every six to eight weeks, with the next meeting concluding on June 14, 2023.

Methodology

National average rates are calculated from the lowest rates offered by over 200 leading lenders, assuming an 80% loan-to-value ratio and a borrower credit score between 700 and 760. These averages reflect realistic quotes customers can expect, differing from promotional teaser rates.

The state-level lowest rates represent the best current offers from lenders in each state using the same assumptions.

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