Wondering what's happening with home affordability? See "The income needed to buy a home in the top 50 metro areas" covering the third quarter of 2023.

Wondering what's happening with home affordability? See "The income needed to buy a home in the top 50 metro areas" covering the third quarter of 2023.

Today's Mortgage Rates - 11/29/2023

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A Serving of Lower Rates

Fixed mortgage rates declined again this week, marking a full month since their last increase.

Freddie Mac reported today that the average offered interest rate for a conforming 30-year fixed-rate mortgage decreased by fifteen basis points (0.15%), landing at 7.29%. This is the lowest mark for the rate on the most popular mortgage since mid-late September, and the four-week cumulative decline seen here now totals a half-percentage point.

Shorter-term fixed mortgage rates also declined, posting a nine basis point (0.09%) decline to 6.67%, Mortgages with shorter terms are most popular with homeowners looking to refinance, but rates will need to be significantly lower than now to entice many homeowners to change mortgages.

Fixed mortgage rates have retreated somewhat in recent weeks, lessening the appeal of choosing an ARM as an alternative. Freddie Mac's legacy survey data pegs the interest for a hybrid 5/1 ARM at 6.82%, down 19 basis points (0.19%) from last week.

As they are often kept in a lender's portfolio rather than sold to investors, rates on ARMs vary more widely from lender to lender than do fixed-rate mortgages. In contrast to Freddie's survey data, a different observation of offered rates for 5/1 ARMs -- one from the Mortgage Bankers Association's weekly applications survey -- moved in the other direction, with this observation increasing by eleven basis points (0.11%) to 6.76% in the MBA's latest report.

The general tenor of the economic and inflation news of late has been both softer and more favorable, helping interest rates to ease somewhat. The holiday-shortened week also saw very little of the kind of market-moving data that might push interest rates back up or help them to decline much further. We may see that next week when an update to GDP growth is released, along with the Fed's survey of regional economic conditions and the October update for Personal Consumption Expenditure (PCE) price measures.

The Thanksgiving holiday sees financial markets closed tomorrow, and there's only a shortened bond-market session on tap for Friday, lessening the chances for any serious move in interest rates. As such, expect generally flat mortgage rates over the next few days.

Each week in HSH's MarketTrends newsletter, we track and discuss economic conditions that affect mortgage rates and their impact on housing markets and consumers. Read the most recent edition of MarketTrends or subscribe for email delivery.

Week 30-year-Fixed 15-year-Fixed
11/22 7.290% 6.670%
11/16 7.440% 6.760%
11/09 7.500% 6.810%
11/02 7.760% 7.030%
10/26 7.790% 7.030%
10/19 7.630% 6.920%
10/12 7.570% 6.890%
10/05 7.490% 6.780%
09/28 7.310% 6.720%
09/21 7.190% 6.540%
09/14 7.180% 6.510%
09/07 7.120% 6.520%

Mortgage Choices at a Glance

Loan type/terms Fixed 30 years Fixed 15 years/
20 Years
Hybrid ARM Traditional ARM Balloon Mortgage
Rate changes
  • Never; Fully fixed for entire term
  • Never; Fully fixed for entire term
  • Usually after fixed period of 3, 5, 7 or 10 years
  • After that, annual change typical
  • Fully variable
  • Typically changing at one-year intervals
  • Some have shorter change intervals
  • Never; Fully fixed for entire term
  • Low, stable payment
  • Usually easiest qualification
  • Stable payments
  • Builds equity faster
  • Lower total interest costs than 30-year term
  • Lower rates than fully fixed-rate mortgage
  • Can sometimes borrow larger loan amount for same income
  • Can have lowest interest rates
  • Qualification may not depend upon today's interest rate
  • Often has lower interest rate/monthly payment over balloon period than fixed rate
  • Similar to hybrid ARM
  • Can have highest total interest cost over time
  • User may "buy" more rate stability than actually needed, increasing cost
  • Requires higher income to qualify
  • Less affordable monthly payment
  • Funds commited to payment cannot be used elsewhere
  • Stable payment for a number of years, then unpredictable
  • Rates can jump by as much as 6 percentage points at first adjustment
  • Payments fluctuate at each rate change
  • Unpredictable, rates can change as much as 2 percentage points at each adjustment
  • Loan fully due and payable when balloon period ends
  • Must be paid off or refinanced in unknown market conditions
Alternative strategy
  • Consider Hybrid ARM with appropriate fixed period
  • Consider 30-year term and prepaying loan to preserve cash-flow flexibility
  • Consider Fixed rate mortgage or longest possible fixed period, if loan hold period not known
  • Consider Hybrid ARM to ameliorate rate and payment risks for a given period
  • Consider Hybrid ARM to ensure continued loan availability
These may be useful for...
  • Purchasing a home
  • First-time homebuyers
  • Refinancing to improve cash flow/lower payment
  • Refinancing to lower total interest cost
  • Retiring mortgage more quickly
  • Building or rebuilding equity more quickly
  • Purchasing or refinancing when time horizon is seven years or shorter, and where borrower can handle increase in monthly payments
  • Purchasing or refinancing when interest rates are near top of cycle, and are likely to fall, or sale or refinance is anticipated within three years
  • Purchasing or refinancing when time horizon is three years or longer and home will be sold prior to end of balloon period
Consider if
  • Buying or refinancing a home and planning on owning for longer than 10 years
  • Buying second home
  • Refinancing to build equity
  • Paying off mortgage before life event (retirement, etc)
  • Buying a home and expect to move before fixed period ends, or know income will rise to offset payment risk, even in worst-case scenario
  • Buying or refinancing when income can handle frequent payment changes and worst-case scenario for rates over a four-year period
  • Buying a home and expect to move before balloon period ends, or have resources to pay off mortgage if refinance not available
When shopping, ask about
  • "Full cost" vs. "No cost" refinances, prepaying loan to shorten term if desired
  • If 20-year term makes payment too high, whether 25-year term is available
  • Interest rate caps, for first and subsequent adjustments, worst-case scenario
  • A history of the Index the loan is keyed off, margin and caps
  • Whether or not there is any built-in refinancing option when the balloon period ends
Useful tools & resources

Latest Mortgage Rate Analysis

HSH's longer-range outlook for mortgage rates, where we review our last forecast,discuss current market influences and provide our expectations for mortgage rates over the next nine weeks.

Mortgage Calculators

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