August 19, 2025 – Rates Hold Steady – Forbes Advisor

Today, the mortgage interest rate on a 30-year fixed mortgage is 6.53%, according to the Mortgage Research Center, while the average rate on a 15-year mortgage is 5.51%. On a 30-year jumbo mortgage, the average rate is 6.69%.

30-Year Mortgage Rates Drop 0.35%

Today’s 30-year mortgage—the most popular mortgage product—is 6.53%, down 0.35% from a week earlier.

The interest rate is just one fee included in your mortgage. You’ll also pay lender fees, which differ from lender to lender. Both interest rate and lender fees are captured in the APR. This week the APR on a 30-year fixed-rate mortgage is 6.56%. Last week, the APR was 6.58%.

Let’s say your home loan is $100,000 and you have a 30-year, fixed-rate mortgage with the current rate of 6.53%, your monthly payment will be about $634, including principal and interest (taxes and fees not included), the Forbes Advisor mortgage calculator shows. That’s around $128,919 in total interest over the life of the loan.

15-Year Mortgage Rates Climb 0.11%

The average interest rate on a 15-year mortgage (fixed-rate) inched up to 5.51%. This same time last week, the 15-year fixed-rate mortgage was at 5.5%.

The APR on a 15-year fixed is 5.56%. It was 5.55% this time last week.

At today’s interest rate of 5.51%, a 15-year fixed-rate mortgage would cost approximately $818 per month in principal and interest per $100,000. You would pay around $47,630 in total interest over the life of the loan.

Jumbo Mortgage Rates Drop 0.36%

The average interest rate on the 30-year fixed-rate jumbo mortgage (mortgages above 2025’s conforming loan limit of $806,500 in most areas) decreased to 6.69%. Last week, the average rate was 6.71%.

Borrowers with a 30-year fixed-rate jumbo mortgage with today’s interest rate of 6.69% will pay $644 per month in principal and interest per $100,000. That means you’d pay around $132,467 in total interest over the life of the loan.

Trends in Mortgage Rates for 2025

After reaching 7.04% in January, the average interest rate for a 30-year fixed mortgage has steadily remained in the mid-to-high 6% range. The 15-year fixed mortgage rate has hovered between the low-6% and high-5% range since its January peak of 6.27%.

While rates dropped in mid-January 2025, experts aren’t forecasting a significant decrease in the near future.

When Will Mortgage Rates Go Down?

Various economic factors influence mortgage rates, making it challenging to forecast when rates will drop.

The Federal Reserve’s decisions significantly impact mortgage rates. In response to inflation or an economic downturn, the Fed may lower its federal funds rate, prompting lenders to reduce mortgage rates.

Mortgage rates also track U.S. Treasury bond yields. If bond yields drop, mortgage rates typically follow suit.

Finally, global events that cause financial disruptions can affect mortgage rates. For example, the Covid-19 pandemic led to record-low interest rates when the Fed cut rates.

While a significant decrease in mortgage rates is unlikely in the near future, they may start to decline if inflation eases or the economy weakens.

How Much House Can I Afford?

Everyone’s budget and financial goals vary. How much house you can afford comes down to a number of factors, including what you earn and what you owe. You’ll also want to consider how much you want to save for retirement, school and other expenses down the road.

Here are a few basic factors that go into what you can afford:

• Income
• Debt
• Debt-to-income ratio (DTI)
• Down payment
• Credit score

How Are Mortgage Rates Determined?

Multiple factors affect the interest rate for a mortgage, including the economy’s overall health, benchmark interest rates and borrower-specific factors.

The Federal Reserve’s rate decisions and inflation can influence rates to move higher or lower. Although the Fed raising rates doesn’t directly cause mortgage rates to rise, an increase to its benchmark interest rate makes it more expensive for banks to lend money to consumers. Conversely, rates tend to decrease during periods of rate cuts and cooling inflation.

Home buyers can make several moves to improve their finances and qualify for competitive rates. One is having a good or excellent credit score, which ranges from 670 to 850. Another is maintaining a debt-to-income (DTI) ratio below 43%, which implies less risk of being unable to afford the monthly mortgage payment.

Further, making a minimum 20% down payment can help you avoid private mortgage insurance (PMI) on conventional home loans. If you can afford the larger monthly payment, 15-year home loans have lower rates than a 30-year term.

What Is the Best Type of Mortgage Loan?

Many home buyers are eligible for several mortgage loan types. Each program can have its own advantages:

• Conventional mortgage. A conventional home loan is ideal for borrowers with good or excellent credit to qualify for competitive rates. Additionally, making a minimum 20% down payment helps you waive private mortgage insurance premiums.
• FHA loan. An FHA home loan is best when applying with imperfect credit or a low down payment. You can put as little as 3.5% down with a credit score above 580. A minimum 10% down payment is necessary for credit scores ranging from 500 to 579.
• VA loan. Borrowers with a qualifying military background may prefer a VA loan for its flexibility. A down payment may not be required. While you pay a one-time funding fee, there are no ongoing mortgage insurance premiums or service fees.
• USDA loan. Applicants in eligible rural areas can buy or build a home with no down payment, although an upfront and annual guarantee fee applies. Additionally, income requirements apply and this program requires a moderate income or lower.
• Jumbo loan. Homebuyers in a high-cost-of-living area will need to apply for a jumbo loan when the loan amount exceeds the Federal Housing Finance Agency’s conforming loan limits. The limit in most municipalities is $806,500 in 2025.

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