Mortgage Refinancing Rates Nearing 7% - June 24, 2025
Check out the latest mortgage refinance rates! On Monday, rates for 30-year loans tumbled by 4 basis points, dipping to an average of 7.05%. This slight decrease just edges out the previous six-week low reading of 7.04% from June 12. Compared to May's 10-month high of 7.32%, these rates still seem high. In fact, they're still over a percentage point higher than last September's two-year low of 6.01%.
Other refinance rates also fell on Monday. The 15-year and 20-year rates gave up 3 and 4 basis points, respectively, while the jumbo 30-year refinance rate took a bolder drop of 9 points.
However, it's important to note that the rates we provide differ from the advertised teaser rates you might see online. Those rates often involve fees or are based on ideal borrower scenarios. Your actual rate will depend on factors like your credit score, income, and more, so it's always wise to shop around and compare rates across lenders before making a decision.
Now, let's delve into what drives these mortgage rate changes. It's a complex mix of macroeconomic and industry factors, including:
- Bond market trends, particularly the 10-year Treasury yields
- The Federal Reserve's monetary policy, including its purchases of government-backed mortgages
- Competition amongst lenders and loan types
The mortgage market remained relatively low in 2021 thanks to the Federal Reserve's bond-buying policy in response to the pandemic's economic pressures. However, starting in November 2021, the Fed began tapering down these purchases, leading to fluctuations in mortgage rates.
Between that time and July 2023, the Fed significantly raised the federal funds rate to combat exceptionally high inflation. Even though the fed funds rate doesn't directly impact mortgage rates, its aggressive increases indirectly led to a steep increase in mortgage rates over the last two years.
For instance, in September 2022, the central bank made its first rate cut, lowering the rate by 0.50 percentage points. Then, quarter-point reductions followed in November and December.
However, in their fourth meeting of 2025, the Fed opted to hold rates steady, and additional cuts might be slow in coming. At their March 2025 meeting, the Fed's rate forecast showed that their median expectation for the rest of the year was just two quarter-point rate cuts. With eight rate-setting meetings scheduled per year, this means we could see multiple rate-hold announcements in 2025.
So, remember, your monthly mortgage payment will depend on various factors, including your home price, down payment, loan term, property taxes, homeowners insurance, and interest rate. Use our Mortgage Calculator to estimate your monthly payment and find the best home loan option for you.
Note: This information is provided by Zillow Mortgage API, assuming an LTV ratio of 80% and an applicant credit score between 680 and 739. Your actual rates may vary based on your qualifications and specific lender offers.
- "Investing in personal-finance could involve considering the current mortgage refinance rates, as the 15-year and 20-year rates dropped by 3 and 4 basis points, respectively, on Monday."
- "For those interested in the finance sector, understanding the drivers of mortgage rate changes, such as bond market trends, competition amongst lenders, and the Federal Reserve's monetary policy, is crucial for making informed decisions about investing in personal-finance."
