Mortgage rates have slightly decreased today due to the Treasury Department’s announcement of increasing purchases of long-term bonds. Mortgage rates are tied to the 10-year Treasury note, so positive news for the bond market translates to lower mortgage rates.
The average interest rate on a 30-year fixed-rate mortgage is now at 6.51% APR, according to data from Zillow provided to BW. This is three basis points lower than yesterday and five basis points lower than a week ago. (Refer to the chart below for detailed information.) A basis point is equal to one one-hundredth of a percentage point.
Inflation has been a driving factor in recent bond market fluctuations, and yesterday’s insights from the Federal Reserve shed some light on their stance on rising prices. For more details on this, continue reading below the chart.
Average mortgage rates over the last 30 days
🤓 Kate on Rates: August 20, 2026
📈 What influences mortgage rates?
Yesterday, the Federal Reserve released minutes from its July meeting, where rates were held steady. However, three officials dissented in favor of a quarter-point rate hike.
Concerning inflation, many participants indicated that policy tightening might be necessary if inflation remains high, potentially leading to rate hikes. The minutes did not provide clear indications about future actions.
Upcoming data, such as the Personal Consumption Expenditures Price Index for July, will provide further insights into inflation trends and potential rate adjustments.
Changes in the situation abroad, such as developments in Iran, can also impact mortgage rates, with rates typically rising during escalations and falling during calmer periods.
If you are considering refinancing, it may be beneficial if today’s rates are significantly lower than your current rate, typically by 0.5 to 0.75 percentage points. Use BW’s tools to estimate potential savings from refinancing.
If purchasing a new home is not currently feasible, there are still steps you can take to enhance your buyer profile. Use this time to reduce existing debts and increase your down payment savings. This not only allows for more cash flow for future mortgage payments but also improves your chances of securing a better interest rate when you are ready to buy.
If you are satisfied with a mortgage quote you have received, it may be wise to lock in your rate, especially if your lender offers a float-down option. A float-down allows you to take advantage of a lower rate if the market decreases during your rate lock period. Rate locks provide protection against rate increases while your loan is being processed, offering peace of mind in a fluctuating market.
It is important to note that mortgage rates can change frequently, sometimes on a daily or hourly basis. If you are content with the terms of your current deal, it is safe to make a commitment.
The rates advertised online are typically sample rates for ideal borrowers with excellent credit, substantial down payments, and willingness to pay for mortgage points. text in a different way:
Can you please rephrase the text?