Mortgage Rates Drop 4 Basis Points to 6.675%

On June 30, 2025, the average interest rate for a 30-year, fixed-rate conforming mortgage loan in the U.S. decreased to 6.675%. This marks a decline of approximately 4 basis points from the previous day and about 13 basis points from a week ago. The drop in rates is evident across various mortgage types, including conventional, jumbo, FHA, VA, USDA, and 15-year conventional loans.

For 30-year conventional loans, the current rate stands at 6.675%, down from 6.808% a week ago and 6.882% a month ago. Similarly, 30-year jumbo loans have seen a decrease to 6.769%, compared to 6.952% a week ago and 7.137% a month ago. FHA loans for 30 years are now at 6.474%, down from 6.587% a week ago and 6.532% a month ago. VA loans for the same term are at 6.303%, a decrease from 6.405% a week ago and 6.439% a month ago. USDA loans for 30 years are at 6.449%, slightly down from 6.429% a week ago but up from 6.520% a month ago. Finally, 15-year conventional loans are at 5.859%, down from 5.953% a week ago and 6.084% a month ago.

The recent decline in mortgage rates comes after a period of relative stability, with rates hovering near 7% for much of the past year. Many had hoped that the Federal Reserve's rate cuts starting in September 2024 would lead to a softening of mortgage rates, but this did not materialize. In fact, by January 2025, the average rate on a 30-year, fixed-rate mortgage topped 7% for the first time since May 2024.

Experts agree that while rates in the 2% to 3% range are unlikely to return, rates around the 6% mark are feasible if inflation is tamed and economic confidence is restored. The slight dip in rates at the end of February and early April indicates some volatility, but the overall trend has been one of stability.

Several factors influence mortgage interest rates, including the state of the economy, national debt, demand for home loans, and the actions of the Federal Reserve. Lenders raise rates to protect against inflation and cover costs during high demand periods. The Fed's balance sheet management, particularly the reduction of mortgage-backed securities, also plays a significant role in rate fluctuations.

For homebuyers, comparing rates across different loan types and lenders is crucial. Conventional loans may offer better rates for those with excellent credit, while FHA loans provide options for those with lower credit scores. Shopping around with multiple lenders can save homebuyers hundreds to thousands of dollars annually, especially in a high-interest rate environment.

In summary, the recent drop in mortgage rates provides some relief for potential homebuyers, but the overall trend remains one of stability near 7%. Economic conditions and Federal Reserve policies will continue to influence rates, making it essential for buyers to stay informed and compare options to secure the best possible rate.