States with Lowest Mortgage Rates Today - July 24, 2025
In the current housing market, getting pre-approved for a mortgage can provide a clearer understanding of what one can afford and make one a more attractive buyer. But, with fluctuating mortgage rates, it's essential to shop around for the best deal.
Mortgage rates can be influenced by various factors, including the bond market, the Federal Reserve's monetary policy, and competition among lenders. Currently, the 30-year fixed mortgage rate stands at 6.86%, while the FHA 30-year fixed rate is 7.55%, the 15-year fixed rate is 5.87%, the Jumbo 30-year fixed rate is 6.77%, and the 5/6 ARM rate is 7.37%.
However, these rates can vary significantly from one state to another. Factors such as lender presence, state regulations, average credit scores, average loan sizes, and lender risk tolerance all play a role in determining mortgage rates.
States with more lenders, higher average credit scores, and favourable regulations usually enjoy lower mortgage rates. On the other hand, those with fewer lenders, strict regulations, lower credit scores, or bigger loans face higher rates.
For example, the states with the lowest 30-year new purchase mortgage rates are New York, Washington, New Jersey, North Carolina, California, Michigan, Virginia, Arizona, and Oregon, with averages ranging from 6.66% to 6.83%. Conversely, West Virginia has the highest 30-year new purchase mortgage rate at 6.91%.
It's important to remember that the more one puts down as a down payment, the less one will have to borrow. Online mortgage calculators can help estimate monthly payments based on factors like home price, down payment, loan term, property taxes, homeowners insurance, interest rate, and so on.
The Federal Reserve's role in influencing mortgage rates is not explicitly mentioned in the provided text. However, it is worth noting that the Fed has cut rates three times from September to December 2024, bringing the federal funds rate down to a target range of 4.25%-4.5%.
Analysts are projecting the 30-year mortgage rate to progressively reduce, with hopes of a 5% rate being available by the year 2028. This is good news for potential homebuyers, as lower mortgage rates mean lower monthly payments and a more affordable housing market.
In conclusion, understanding the factors affecting mortgage rates can help potential homebuyers make informed decisions and secure the best deals. Whether you're shopping for a new home or refinancing an existing one, it's crucial to compare offers from multiple lenders and consider factors such as lender presence, state regulations, credit scores, loan sizes, and risk tolerance to find the best deal for your specific financial situation.
[1] State-by-State Mortgage Rates: Average 30-Year Rates by State [2] How Mortgage Rates Vary by State [3] Average Credit Scores by State
- Getting pre-approved for a mortgage and understanding one's affordability can make one a more attractive buyer in the current real estate market. However, due to fluctuating mortgage rates, it's vital to shop around for the best deal among various factors influencing rates.
- Influencing factors for mortgage rates include the bond market, Federal Reserve's monetary policy, and competition among lenders, with current rates varying significantly from one state to another. States with more lenders, higher average credit scores, and favorable regulations tend to enjoy lower mortgage rates.
- For instance, the states with the lowest 30-year new purchase mortgage rates include New York, Washington, New Jersey, North Carolina, California, Michigan, Virginia, Arizona, and Oregon, while West Virginia has the highest 30-year new purchase mortgage rate.
- To manage monthly payments better, online mortgage calculators can help potential home buyers estimate payments based on factors like home price, down payment, loan term, property taxes, homeowners insurance, interest rate, and more.
- Potential homebuyers might find it advantageous as analysts project a progressive reduction of the 30-year mortgage rate to 5% by 2028, creating a more affordable housing market due to lower monthly payments. For a comprehensive understanding of how mortgage rates differ by state, it's beneficial to compare offers from multiple lenders, considering factors such as lender presence, state regulations, credit scores, loan sizes, and risk tolerance.
