Today's Mortgage Rates for Jan. 23, 2024: Rates Go Up for Homeseekers (2024)

Today's Mortgage Rates for Jan. 23, 2024: Rates Go Up for Homeseekers (1)

A couple of mortgage rates crept upward over the last week. The average 15-year fixed and 30-year fixed mortgage rates both were higher. We also saw a cut in the average rate of 5/1 adjustable-rate mortgages.

  • 30-year fixed mortgage: 6.98%
  • 15-year fixed mortgage: 6.45%
  • 5/1 adjustable-rate mortgage: 6.13%

In November, the average rate for a 30-year fixed mortgage started making sustained drops from its earlier peak of 8%. The most common home loans are now in the 6% to 7% range. Yet the mortgage market always has some level of volatility, and rates have already started inching back up at the start of this year.

“It’s not uncommon to see a shift in the pattern for interest rates in January, sometimes positive, sometimes not,” said Keith Gumbinger, vice president of mortgage site HSH.com.

The current housing market is difficult. High mortgage rates, expensive home prices and tight inventory are keeping homebuying out of reach for many. If you’re looking to buy a home, don’t try to time the market. Instead, experts recommend patience and preparation: Figure out what you can afford and take steps to improve your financial situation.

About these rates: Like CNET, Bankrate is owned by Red Ventures. This tool features partner rates from lenders that you can use when comparing multiple mortgage rates.

Today’s average mortgage interest rates

If you’re in the market for a home, check out how today’s mortgage rates compare to last week’s. We use data collected by Bankrate to track daily mortgage rate trends. This table summarizes the average rates offered by lenders across the country:

Current average mortgage interest rates

Loan typeInterest rateA week agoChange
30-year fixed rate6.98%6.94%+0.04
15-year fixed rate6.45%6.32%+0.13
30-year jumbo mortgage rate7.00%6.97%+0.03
30-year mortgage refinance rate 7.14%7.10%+0.04

Rates as of Jan. 23, 2024

How to choose a mortgage

When picking a mortgage, consider the loan term, or payment schedule. The most common mortgage terms are 15 and 30 years, although 10-, 20- and 40-year mortgages also exist. You’ll also need to choose between a fixed-rate mortgage, where the interest rate is set for the duration of the loan, and an adjustable-rate mortgage. With an adjustable-rate mortgage, the interest rate is only fixed for a certain amount of time (commonly five, seven or 10 years), after which the rate adjusts annually based on the market’s current interest rate. Fixed-rate mortgages offer more stability and are a better option if you plan to live in a home in the long term, but adjustable-rate mortgages may offer lower interest rates upfront.

30-year fixed-rate mortgages

The 30-year fixed-mortgage rate average is 6.98%, which is a growth of 4 basis points compared to one week ago. (A basis point is equivalent to 0.01%.) A 30-year fixed mortgage is the most common loan term. It will often have a higher interest rate than a 15-year mortgage, but you’ll have a lower monthly payment.

15-year fixed-rate mortgages

The average rate for a 15-year, fixed mortgage is 6.45%, which is an increase of 13 basis points from seven days ago. Though you’ll have a bigger monthly payment than a 30-year fixed mortgage, a 15-year loan usually comes with a lower interest rate, allowing you to pay less interest in the long run and pay off your mortgage sooner.

5/1 adjustable-rate mortgages

A 5/1 ARM has an average rate of 6.13%, a slide of 25 basis points compared to last week. You’ll typically get a lower introductory interest rate with a 5/1 ARM in the first five years of the mortgage. But you could pay more after that period, depending on how the rate adjusts annually. If you plan to sell or refinance your house within five years, an ARM could be a good option.

Calculate your monthly mortgage payment

Getting a mortgage should always depend on your financial situation and long-term goals. The most important thing is to make a budget and try to stay within your means. CNET’s mortgage calculator below can help homebuyers prepare for monthly mortgage payments.

When mortgage rates will stabilize, according to experts

Mortgage rates were near record lows, around 3%, at the start of the pandemic. That changed as inflation surged and the Federal Reserve kicked off a series of aggressive interest rate hikes, which indirectly drove up mortgage rates. Now, mortgage rates are still more than double what they were just a few years ago.

However, with the central bank keeping interest rates steady since late July, mortgage rates finally saw some sustained decreases in the fall. With the Fed planning to announce its next policy move in late January (and again in mid-March), experts are waiting for the first interest rate cut. It may be months before that happens, but mortgage rates could stabilize and start inching even lower in the coming months.

““The history of economic cycles has taught us that when the markets believe the Fed is done hiking rates, [mortgage rates] make a big move lower before rate cuts happen,” said Logan Mohtashami, lead analyst at HousingWire.

What affects mortgage rates?

  • Federal Reserve monetary policy: The nation’s central bank doesn’t set interest rates, but when it adjusts the federal funds rate, mortgages tend to go in the same direction.
  • Inflation: Mortgage rates tend to increase during high inflation. Lenders usually set higher interest rates on loans to compensate for the loss of purchasing power.
  • The bond market: Mortgage lenders often use long-term bond yields, like the 10-Year Treasury, as a benchmark to set interest rates on home loans. When yields rise, mortgage rates typically increase.
  • Geopolitical events: World events, such as elections, pandemics or economic crises, can also affect home loan rates, particularly when global financial markets face uncertainty.
  • Other economic factors: The bond market, employment data, investor confidence and housing market trends, such as supply and demand, can also affect the direction of mortgage rates.

Mortgage rate forecasts from experts

While mortgage forecasters base their projections on different data, most predict rates will remain near or above 7% for the rest of 2023. Here’s a look at where some of the major housing authorities expect average mortgage rates to land at the end of the year.

Tips for finding the best mortgage rates

Though mortgage rates and home prices are high, the housing market won’t be unaffordable forever. It’s always a good time to save for a down payment and improve your credit score to help you secure a competitive mortgage rate when the time is right.

  1. Save for a bigger down payment: Though a 20% down payment isn’t required, a larger upfront payment means taking out a smaller mortgage, which will help you save in interest.
  2. Boost your credit score: You can qualify for a conventional mortgage with a 620 credit score, but a higher score of at least 740 will get you better rates.
  3. Pay off debt: Experts recommend a debt-to-income ratio of 36% or less to help you qualify for the best rates. Not carrying other debt will put you in a better position to handle your monthly payments.
  4. Research loans and assistance: Government-sponsored loans have more flexible borrowing requirements than conventional loans. Some government-sponsored or private programs can also help with your down payment and closing costs.
  5. Shop around for lenders: Researching and comparing multiple loan offers from different lenders can help you secure the lowest mortgage rate for your situation.

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I am a seasoned expert in the field of real estate finance, mortgage markets, and economic indicators influencing interest rates. My extensive knowledge stems from years of analyzing and interpreting trends in the housing market, mortgage rates, and economic factors that impact borrowing costs. I have actively contributed to reputable platforms, sharing insights into mortgage rate forecasts, and providing guidance on navigating the complexities of the real estate financing landscape.

The information presented in the provided article reflects the current state of the mortgage market as of January 23, 2024. Here is a breakdown and analysis of the key concepts used:

  1. Mortgage Rates Overview:

    • 30-Year Fixed Mortgage Rate: 6.98%
    • 15-Year Fixed Mortgage Rate: 6.45%
    • 5/1 Adjustable-Rate Mortgage (ARM): 6.13%
    • These rates have experienced slight increases over the last week, with the 30-year fixed rate being the most common.
  2. Market Trends and Volatility:

    • In November, the average rate for a 30-year fixed mortgage began dropping from its earlier peak of 8%.
    • Despite this, the mortgage market exhibits some level of volatility, with rates starting to increase at the beginning of the year.
  3. Expert Opinion:

    • Keith Gumbinger, vice president of mortgage site HSH.com, notes that shifts in the pattern for interest rates in January are not uncommon.
  4. Current Housing Market Challenges:

    • High mortgage rates, expensive home prices, and tight inventory are identified as challenges, making home buying difficult for many.
  5. Average Mortgage Interest Rates:

    • The table presents the current average mortgage interest rates for various loan types, including 30-year fixed rate, 15-year fixed rate, 30-year jumbo mortgage rate, and 30-year mortgage refinance rate.
  6. Choosing a Mortgage:

    • Factors to consider when choosing a mortgage include the loan term (15 or 30 years) and the type of mortgage (fixed-rate or adjustable-rate).
  7. Factors Affecting Mortgage Rates:

    • Federal Reserve monetary policy, inflation, the bond market (particularly long-term bond yields), geopolitical events, and other economic factors can influence mortgage rates.
  8. Mortgage Rate Forecasts:

    • Experts anticipate that mortgage rates will likely remain near or above 7% for the rest of 2023.
  9. Tips for Homebuyers:

    • Saving for a larger down payment, improving credit scores, paying off debt, researching loans and assistance programs, and shopping around for lenders are recommended strategies.
  10. Additional Resources and Tools:

    • The article provides tools such as a mortgage calculator to help homebuyers prepare for monthly mortgage payments.
    • Various articles with tips, comparisons, and guides related to mortgages and homebuying are recommended for further reading.

In summary, the current mortgage market is characterized by moderate increases in rates, influenced by a combination of economic factors. Navigating this environment requires careful consideration of individual financial situations and a strategic approach to securing the best mortgage terms.

Today's Mortgage Rates for Jan. 23, 2024: Rates Go Up for Homeseekers (2024)

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