Mortgage Rates Today, Thursday, October 15: A Little Higher

Yes, mortgage interest rates are up today, but only by a little. If anything, it’s surprising that they aren’t higher, given the spooky inflation report that dropped yesterday.

The average interest rate on a 30-year, fixed-rate mortgage rose to 7.32% APR, according to rates provided to NerdWallet by Zillow. This is two basis points higher than yesterday but five basis points lower than a week ago. (See our chart below for more specifics.) A basis point is one one-hundredth of a percentage point.

In the coming days, the direction of mortgage rates will depend a lot on oil price fluctuations (which affect rates in the short term) and whether markets think the Fed will raise borrowing rates again later this month (which has long-term implications). For more on this, read our analysis below.

» Take the next step: Compare mortgage rates from NerdWallet’s top lenders

📈 What influences mortgage rates?

Mortgage rates are constantly changing, since a major part of how rates are set depends on reactions to new inflation reports, job numbers, Fed meetings, global news ... you name it. For example, even tiny changes in the bond market can shift mortgage pricing.

Inflation has played a key role in driving up mortgage rates over the past several months, as the Iran war intensified price pressures. The conflict directly affects a key shipping route and oil production, and that indirectly affects the prices of all sorts of goods.

That kind of inflationary environment isn't great for bonds, and the interest rates on 30-year fixed rate mortgages are benchmarked to the yield on the 10-year Treasury note. So where bond yields go, mortgage rates go, too. (For more, here's a much deeper dive on the bond market as it pertains to mortgage rates.)

Persistent inflation also spells trouble for the Federal Reserve. Price stability is half of the Fed's dual mandate (maximum employment is the other half), and inflation has been running above the central bankers' 2% target since 2021. With the conflict in Iran making already-bad inflation worse, the Fed shifted into rate-hiking mode last month.

Raising the federal funds rate, which is the short-term borrowing rate the bankers set, is the Fed's main tool for fighting inflation. Even though the Fed doesn't set mortgage rates, changes to the funds rate ripple out through the entire economy. So a rate hike from the Federal Reserve  — or even markets having relative certainty that a hike is coming — can put upward pressure on mortgage rates.

Why do markets think a rate hike could come this month? The Bureau of Labor Statistics released the September Consumer Price Index, a major inflation report, yesterday. It showed that inflation rose 3.7% last month, largely driven by rising fuel costs.

In the hours following the report drop, futures traders initially revised their projections in favor of another rate hike on Oct. 28. Today, expectations are cooler, with traders now expecting that central bankers will probably vote to hold rates steady.

Fed Chair Kevin Warsh has previously expressed his wish that investors would interpret data themselves, instead of dissecting central bankers’ public statements for Easter eggs about how they’ll vote.

For now, markets are still pretty much hanging on their every word. Any time a voting member of the Federal Open Market Committee publicly voices an opinion about inflation, it has the potential to shift mortgage rates.

» Learn more: How the Fed affects mortgage rates

🔁 Should I refinance?

Refinancing might make sense if today’s rates are at least 0.5 to 0.75 of a percentage point lower than your current rate (and if you plan to stay in your home long enough to break even on closing costs).

With rates where they are right now, you may want to start considering a refi if your current rate is around 7.82% or higher — but there just aren't too many people for whom that's true.

Also consider your goals: Are you trying to lower your monthly payment, shorten your loan term or turn home equity into cash? For example, you might be more comfortable with paying a higher rate for a cash-out refinance than you would for a rate-and-term refinance, so long as the overall costs are lower than if you kept your original mortgage and added a HELOC or home equity loan.

If you're looking for a lower rate, use NerdWallet's refinance calculator to estimate savings and understand how long it would take to break even on the costs of refinancing.

» Time to refi? Compare refinance rates from NerdWallet’s top lenders

🏡 Should I start shopping for a home?

There is no universal “right” time to start shopping — what matters is whether you can comfortably afford a mortgage now at today’s rates.

If the answer is yes, don’t get too hung up on whether you could be missing out on lower rates later; you can refinance down the road. Focus on getting preapproved, comparing lender offers, and understanding what monthly payment works for your budget.

NerdWallet’s affordability calculator can help you estimate your potential monthly payment. If a new home isn’t in the cards right now, there are still things you can do to strengthen your buyer profile. Take this time to pay down existing debts and build your down payment savings. Not only will this free up more cash flow for a future mortgage payment, it can also get you a better interest rate when you’re ready to buy.

» Is now a good time to buy? See NerdWallet’s analysis

🔒 Should I lock my rate?

If you already have a quote you’re happy with, you should consider locking your mortgage rate, especially if your lender offers a float-down option. A float-down lets you take advantage of a better rate if the market drops during your lock period.

Rate locks protect you from increases while your loan is processed, and with the market forever bouncing around, that peace of mind can be worth it.

» Stay informed: Check out NerdWallet's mortgage news hub for all our latest coverage.

🧐 Why is the rate I saw online different from the quote I got?

The rate you see advertised is a sample rate — usually for a borrower with perfect credit, making a big down payment, and paying for mortgage points. That won't match every buyer's circumstances.

In addition to market factors outside of your control, your customized quote depends on your:

• Credit score

• Debt-to-income ratio

• Employment history

• Down payment

• Type of mortgage

• Location and property type

• Loan amount

Even two people with similar credit scores might get different rates, depending on their overall financial profiles.

» Get the best rate for you: How to get the best mortgage rate

👀 If I apply now, can I get the rate I saw today?

Maybe — but even personalized rate quotes can change until you lock. That’s because lenders adjust pricing multiple times a day in response to market changes.