Mortgage rates rise amid inflation uncertainty

Image by PM Images/Getty Images; Illustration by Hunter Newton/Bankrate

Mortgage rates rose this week, with the average 30-year fixed loan rising to 7.17 percent, according to Bankrate’s latest survey of major lenders. Interest rates have risen this year as the outlook for the Federal Reserve’s long-awaited rate cuts becomes increasingly bleak.

Current mortgage interest rate

Type of loan Current 4 weeks ago A year ago Average over 52 weeks Low in 52 weeks
30 years 7.17% 7.39% 6.90% 7.22% 6.84%
15 years 6.56% 6.70% 6.35% 6.56% 6.13%
30 years jumbo 7.23% 7.33% 6.66% 7.13% 6.64%

The 30-year mortgages in this week’s survey averaged a total of 0.3 discount and origination points. Discount points are a way to lower your mortgage interest rate, while origination points are fees charged by a lender to originate, appraise and process your loan.

Monthly mortgage payment at current rates


Monthly mortgage payment from May 29

The national median household income for 2024 is $97,800, according to the U.S. Department of Housing and Urban Development, and the median price of an existing home sold in April 2024 was $407,600, according to the National Association of Realtors (NAR). Based on a 20 percent down payment and a mortgage interest rate of 7.17 percent, the $2,207 monthly payment is 27 percent of an average family’s monthly income.

“Borrowers remain sensitive to small rate increases, which will impact the refinancing market and keep purchase applications below last year’s levels,” said Joel Kan, deputy chief economist at the Mortgage Bankers Association.

With mortgage rates well above pandemic lows, home sales are sluggish. The National Association of Realtors said last week that home sales fell to an annual pace of just 4.1 million units in April.

Will mortgage interest rates go down?

The mortgage interest rate is linked to inflation. Another bit of good news: inflation is cooling down a bit. The U.S. Department of Labor said in mid-May that inflation had fallen to 3.4 percent. That encouraged investors, but it is unclear whether the Federal Reserve will cut interest rates soon. The central bank left interest rates unchanged in May – and the latest figures show inflation is still well above the Fed’s 2 percent target.

To be clear, mortgage rates are not set directly by the Fed, but by investor appetite, especially for 10-year Treasury bonds, the key indicator of fixed mortgage prices. This can lead to wild interest rate fluctuations: they rise sharply on news of interest rate increases by the Fed, but then fall in anticipation of an interest rate cut.

Mortgage rates are also tied to inflation, a measure the Fed is increasingly trying to get under control. While most Fed members still expect three rate cuts this year, a regional Fed president now predicts just one rate cut in 2024.

According to the Mortgage Bankers Association, loan applications fell 5.7 percent this week, while home prices remain high. While brokers are reporting increases in inventory, many markets still don’t have enough affordably priced listings to meet demand.

  •’s national survey of major lenders is conducted weekly. To conduct the National Average study, Bankrate obtains interest rate data from the ten largest banks and savings accounts in ten major U.S. markets. In’s national survey, our market analysis team collects interest rates and/or yields on bank deposits, loans and mortgages. We have been conducting this survey the same way for more than thirty years, and because it is consistently conducted as is, it provides an accurate national apples-to-apples comparison. Our rates differ from other national surveys, specifically Freddie Mac’s weekly published rates. Each week, Freddie Mac surveys lenders about the rates and points based on prime, conventional, conforming home purchase mortgages with an 80 percent loan-to-value ratio. “Each week, lender surveys include a mix of lender types – thrift associations, credit unions, commercial banks and mortgage lenders – roughly proportional to the level of mortgage activity each type has nationwide,” Freddie Mac said.

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