Today's Mortgage Rates - 07/18/2025

Mortgage Rates Tilt Upward

Mortgage rates rose modestly for a second straight week.

Freddie Mac reported today that the average offered interest rate for a conforming 30-year fixed-rate mortgage (FRM) rose by three basis points (0.03%) to 6.77%, still holding near the center of a four-week range.

Average offered rates for 15-year fixed-rate mortgages rose by a bit more than its longer-term sibling, posting another six basis point increase. This put the average rate for the most common shorter-term mortgage at 5.92%, just about where it was one month ago.

At present, a 5/1 ARM might offer a homebuyer a lower-cost alternative to a long-term fixed-rate mortgage, but the difference in rate between 30-year FRMs and 5-year hybrid ARMs shrank a little this week again. The Mortgage Bankers Association said that the initial fixed interest rate on a hybrid 5-year ARM increased by seven basis points, rising to 6.08%.

With the increase, the gap in rate compared to a 30-year FRM decreased to sixty-seven basis points (0.67%). Comparing this average rate against that for a 30-year FRM, a homebuyer with a $300,000 loan amount who selects the 5-year ARM would be able to save over $10,000 in interest cost over the first five years of the loan, while also reducing the loan's outstanding balance by nearly $2,200 compared to the 30-year FRM.

ARMs aren't for everybody, though. To help decide whether one might work for you, read HSH's Comprehensive Guide to Adjustable Rate Mortgages.

Upward pressure on longer-term interest rates came from a range of influences this week. The latest inflation reports suggest we may be starting to see some of the effect of the "blanket" tariffs put into place back in April, as the Consumer Price Index rose by 0.3% for June, and core CPI by 0.2%. These increases lifted the annual rates of CPI inflation to 2.7% overall (from 2.4%) and to 2.9% (2.8%) for core CPI. While the increases were still fairly mild, they were also modest steps in the wrong direction for anyone hoping that the Fed will start cutting rates later this month.

On the topic of the Fed, markets were again whipsawed this week by reports that President Trump was preparing to fire Fed Chair Jerome Powell, hard polled some Republican leaders and even had a termination letter drafted. Shortly thereafter, the President said that no such action was imminent -- "we're not planning on doing it," he said.

Whether it's just posturing to try to get the Fed to cut rates more quickly or something else, it simply added to upward pressure on bond yields, lifting the yield of the influential 10-year Treasury back closer to 4.5% again. Although it has settled back a little from that level, it is still rather above where it began the week, and that likely means somewhat firmer mortgage rates in the market over the coming 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.