Mortgage Rate History | Chart & Trends Over Time 2025

Trends in historical mortgage rates

For many homebuyers, the last few years have felt like a perfect storm of challenges—soaring home prices and climbing mortgage rates colliding to limit affordability. It’s left many wondering if 2025 will finally calm the waters. Will rates dip low enough to bring some relief, or is another wave of increases on the horizon? While there’s no magic compass to navigate these market shifts, a look back at mortgage rate history can offer clues—and maybe even some hope for those waiting to make their move.

Despite the Federal Reserve’s 25-basis-point rate cut in November, mortgage rates have remained in the high 6% range, offering limited relief to borrowers. However, optimism persists in the market as many believe rates could continue to ease in the months ahead, potentially sparking renewed interest among buyers and homeowners.

While the history of mortgage rates provides valuable context, it’s important to recognize that average mortgage rates are just a benchmark. Borrowers with healthy credit profiles and strong finances often get mortgage rates well below the industry norm.

So rather than looking only at average rates, check your personalized rates to see what you qualify for.

In this article (Skip to...)

• Historical rate chart
• Average rates by year
• 30-year rate chart
• Historical perspective
• Will rates go back down?
• What affects your rate
• Other mortgage costs

Historical mortgage rates chart

Current rates are more than double their all-time low of 2.65% (reached in January 2021). But if we take a step back and look at the history of mortgage rates, they’re still close to the historic average.

Freddie Mac — the main industry source for mortgage rates — has been keeping records since 1971. Between April 1971 and December 2024, 30-year fixed-rate mortgages averaged 7.73%.

To understand today’s mortgage rates in context, take a look at where they’ve been throughout history.

Historical 30-year mortgage rates chart

Chart represents weekly averages for a 30-year fixed-rate mortgage. Average for 1971-2024 as of December 5, 2024. Source: Freddie Mac PMMS. (c) TheMortgageReports.com

30-year fixed-rate mortgage trends over time

Understanding mortgage rates history helps frame current conditions and shows how today’s rates compare to the historic mortgage rates averages. Here’s how average 30-year rates have changed from year to year over the past five decades.

Source: Freddie Mac

Historical mortgage rates chart for 2023 and 2024

Mortgage interest rates fell to historic lows in 2020 and 2021 during the Covid pandemic. Emergency actions by the Federal Reserve helped push mortgage rates below 3% and kept them there.

The story changed in 2022. With inflation running ultra-hot, mortgage interest rates surged to their highest levels since 2002. According to Freddie Mac’s records, the average 30-year rate jumped from 3.22% in January to a high of 7.08% at the end of October, emphasizing the dramatic shifts in mortgage rates history and the impact of economic conditions on borrowing costs.

While the anticipation was for mortgage rates to recede in 2023, that wasn’t the case. Despite the Federal Reserve’s attempts to slow the pace of rate increases, the broader economic landscape and various global factors maintained the upward pressure, presenting an enduring challenge for the Fed’s intended rate management.

Looking back at 2024, mortgage rates have experienced notable ups and downs, with a brief reprieve in September offering some hope to homebuyers. However, for the most part, rates have fluctuated throughout the year, mirroring the volatility seen in 2023, without a consistent decline. Despite this, the two Federal Reserve rate cuts have sparked optimism, signaling the possibility of further reductions in 2025.

Historical mortgage rates chart for 2023 and 2024

Chart represents weekly averages for a 30-year fixed-rate mortgage. Average for 2022-24 as of December 5, 2024. Source: Freddie Mac PMMS. (c) TheMortgageReports.com

Historic mortgage rates: Important years for rates

The long-term average for mortgage rates is just under 8 percent. That’s according to Freddie Mac records going back to 1971. But historical mortgage rates show that rates can fluctuate significantly from year to year. And some years have seen much bigger moves than others.

Let’s look at a few examples to show how rates often buck conventional wisdom and move in unexpected ways.

1981: The all-time high for mortgage rates

1981 was the worst year for mortgage interest rates on record.

How bad is bad? The average mortgage rate in 1981 was 16.63 percent.

• At 16.63%, a $200,000 mortgage has a monthly cost for principal and interest of $2,800
• Compared with the long-time average that’s an extra monthly cost of $1,300 or $15,900 per year

And that’s just the average — some people paid more. For the week of Oct. 9, 1981, mortgage rates averaged 18.63%, the highest weekly rate on record, and almost five times the 2019 annual rate.

2008: The mortgage slump

2008 was the final gasp of the mortgage meltdown. Real estate financing was available in 2008 for 6.03%, according to Freddie Mac.

• The monthly payment for a $200,000 mortgage was about $1,200, not including taxes and insurance

Post-2008, rates declined steadily.

2016: An all-time low for mortgage rates

Until recently, 2016 held the lowest annual mortgage rate on record since 1971. Freddie Mac says the typical 2016 mortgage was priced at just 3.65 percent.

• A $200,000 mortgage at 3.65% has a monthly cost for principal and interest of $915
• That’s $553 a month less than the long-term average

Mortgage rates had dropped lower in 2012, when one week in November averaged 3.31 percent. But some of 2012 was higher, and the entire year averaged out at 3.65% for a 30-year mortgage.

2019: The surprise mortgage rate drop-off

In 2018, many economists predicted that 2019 mortgage rates would top 5.5 percent. However, mortgage rates history shows that this forecast was off the mark. In fact, rates dropped in 2019. The average mortgage rate went from 4.54% in 2018 to 3.94% in 2019.

• At 3.94%, the monthly payment for a $200,000 home loan was $948
• That’s a savings of $520 a month — or $6,240 a year — when compared with the 8% long–term average

In 2019, it was thought mortgage rates couldn’t go much lower. But 2020 and 2021 proved that thinking wrong again.

2021: The lowest 30-year mortgage rates ever

Rates plummeted in 2020 and 2021 in response to the Coronavirus pandemic. By July 2020, the 30-year fixed rate fell below 3% for the first time. And it kept falling to a new record low of just 2.65% in January 2021. The average mortgage rate for that year was 2.96%. That year marked an incredibly appealing homeownership opportunity for first-time homebuyers to enter the housing market. It also resulted in a surge in refinancing activity among existing homeowners, reflecting a notable moment in historical mortgage rates that reshaped the landscape for many.

• At 2.65%, the monthly payment for a $200,000 home loan is $806 not counting taxes and insurance
• You’d save $662 a month, or $7,900 a year, compared to the 8% long-term average

However, record-low rates were largely dependent on accommodating, Covid-era policies from the Federal Reserve. Those measures were never meant to last. And the more U.S. and world economies recover from their Covid slump, the higher interest rates are likely to go.

2022: Surge in mortgage rates

Thanks to sharp inflation growth, higher benchmark rates, and a drawback on mortgage stimulus by the Fed, mortgage rates spiked in 2022.

According to Freddie Mac’s records, the average 30-year rate jumped from 3.22% in January to a high of 7.08% at the end of October. That’s an increase of nearly 400 basis points (4%) in ten months.

As the year concluded, the average mortgage rate went from 2.96% in 2021 to 5.34% in 2022. Although, if the Fed gets inflation in check or the U.S. enters a meaningful recession, mortgage rates could come back down somewhat.

2023: Mortgage rates and tug-of-war with inflation

As the Federal Reserve continues its battle against inflation and edges closer to reaching its 2% target, mortgage rates have continued to indirectly climb higher. Since the Federal Reserve began its rate hikes in March 2022, the benchmark interest rate has risen 5 percentage points.

According to Freddie Mac’s records, the average 30-year rate reached 6.48% during the initial week of 2023, increasing steadily to eventually land at 7.03% in December.

The question arises: where will mortgage rates ultimately settle next year? U.S. Federal Reserve officials expect to cut interest rates two times in 2024. This move could alleviate significant upward pressure on mortgage rates, potentially leading to a more substantial rate decline. We’ll have to wait and see if rates breach the much anticipated 6% mark in 2024.

2024: A year of ups and downs for mortgage rates

In 2024, mortgage rates saw considerable fluctuations, with a brief period of relief in the fall, but overall remained high, averaging around 6.7% for the year. The Federal Reserve’s two rate cuts, in September and November, did not directly lead to a sustained decrease in rates, but they have sparked optimism for further declines in 2025 as inflation continues to moderate. This offers hope that more favorable conditions could emerge for homebuyers in the coming year.

Will mortgage rates go back down?

Extremely high prices and an overall strong economy have led the Federal Reserve to take drastic measures, implementing a rapid succession of rate increases unseen since the early 1980s.

These measures have involved four historic rate hikes of 75 basis points (0.75%), executed in June, July, September, and November of 2022. Although fixed mortgage rates are not controlled by the Fed, their actions have undeniably contributed to a significant upward push in these rates.

In December 2022, the Federal Reserve made the decision to dial down the pace of interest rate hikes, cutting the fed funds rate by only 50 basis points (0.50%). This trend of dialing back has persisted into 2023, evidenced by four adjustments of 25 basis points (0.25%) in January, March, May, and late July. Finally, in September 2024, the Federal Reserve made its first cut, resulting in the current federal funds rate sitting in a range of 4.75% to 5.00%.

As 2024 comes to an end, the outlook for mortgage rates has largely aligned with earlier predictions. Both the Mortgage Bankers Association (MBA) and the National Association of Realtors (NAR) anticipated 30-year mortgage rates to range between 6.1% and 6.8%, and those forecasts have proven to be accurate as rates have declined from last year’s highs. This trend has provided much-needed relief for buyers and homeowners alike.

Many are speculating about where mortgage rates will go in 2025. Experts predict further declines, with the Mortgage Bankers Association and Wells Fargo forecasting the 30-year fixed mortgage rate could fall to between 5.5% and 6.0% by the end of next year​. With the Federal Reserve’s two rate cuts already in place, these anticipated declines could create a more favorable market for homebuyers and homeowners alike.

As a borrower, it doesn’t make much sense to try to time your rate in this market. Our best advice is to buy when you’re financially ready and can afford the home you want — regardless of current interest rates.

Remember that you’re not stuck with your mortgage rate forever. If rates drop significantly, homeowners can always refinance later on to cut costs.

Factors that affect your mortgage interest rate

For the average homebuyer, tracking historical mortgage rates helps reveal trends. But not every borrower will benefit equally from today’s competitive mortgage rates.

Home loans are personalized to the borrower. Your credit score, down payment, loan type, loan term, and loan amount will affect your mortgage or refinance rate.

It’s also possible to negotiate mortgage rates. Discount points can provide a lower interest rate in exchange for paying cash upfront.

Let’s look at some of these factors individually:

Credit score

A credit score above 720 will open more doors for low-interest-rate loans, though some loan programs such as USDA, FHA, and VA loans can be available to sub-600 borrowers.

If possible, give yourself a few months or even a year to improve your credit score before borrowing. You could save thousands of dollars through the life of the loan.

Down payment

Higher down payments can shave your borrowing rate.

Most mortgages, including FHA loans, require at least 3 or 3.5% down. And VA loans and USDA loans are available with zero down payment. But if you can put 10, 15, or even 20% down, you might qualify for a conventional loan with low or no private mortgage insurance and seriously reduce your housing costs.

Loan type

The type of mortgage loan you use will affect your interest rate. However, your loan type hinges on your credit score. So these two factors are very intertwined.

For example, with a credit score of 580, you may qualify only for a government-backed loan such as an FHA mortgage. FHA loans have low interest rates, but come with mortgage insurance no matter how much money you put down.

A credit score of 620 or higher might qualify you for a conventional loan, and — depending on your down payment and other factors — potentially a lower rate.

Adjustable-rate mortgages traditionally offer lower introductory interest rates compared to a 30-year fixed-rate mortgage. However, those rates are subject to change after the initial fixed-rate period. An initially low ARM rate could rise substantially after 5, 7, or 10 years.

Loan term

In this post we’ve tracked rates for 30-year fixed-rate mortgages. But 15-year fixed-rate mortgages tend to have even lower borrowing rates.

With a 15-year mortgage, you’d have a higher monthly payment because of the shorter loan term. But throughout the life of the loan you’d save a lot in interest charges.

If you took out a $400,000 home loan with a 30-year fixed rate of 6.75%, you’d pay around $533,981 in total interest over the life of the loan. The same loan size with a 15-year fixed rate of just 5.75% would cost only $207,577 in interest — saving you around $326,404 in total.

Loan amount

Rates on unusually small mortgages — a $50,000 home loan, for example — tend to be higher than average rates because these loans are less profitable to the mortgage lender.

Rates on a jumbo mortgage are normally higher, too, because mortgage lenders have a higher risk of loss. But jumbo loan rates have reversed course and stayed below conforming rates in 2024, creating great deals for jumbo loan borrowers. Currently, a jumbo mortgage is any loan amount over $ in most parts of the U.S.

Discount points

A discount point can lower interest rates by about 0.25% in exchange for upfront cash. A discount point costs 1% of the home loan amount.

For a $400,000 loan, a discount point would cost $4,000 upfront. However, the borrower would recoup the upfront cost over time thanks to the savings earned by a lower interest rate.

Since interest payments play out over time, a buyer who plans to sell the home or refinance within a couple of years should probably skip the discount points and pay a higher interest rate for a while.

Some rate quotes assume the home buyer will buy discount points, so be sure to check before closing on the loan.

Other mortgage costs to keep in mind

Remember that your mortgage rate is not the only number that affects your mortgage payment.

When you’re estimating your home buying budget, you also need to account for:

• Down payment
• Closing costs
• Discount points (optional)
• Private mortgage insurance (PMI) or FHA mortgage insurance premiums
• Homeowners insurance
• Property taxes
• HOA dues (if buying in a homeowners association)

When you get pre-approved, you’ll receive a document called a Loan Estimate that lists all these numbers clearly for comparison. You can use your Loan Estimates to find the best overall deal on your mortgage — not just the best interest rate.

You can also use a mortgage calculator with taxes, insurance, and HOA dues included to estimate your total mortgage payment and home buying budget.

When to lock your mortgage rate

Keep an eye on daily rate changes. But if you get a good mortgage rate quote today, don’t hesitate to lock it in.

Remember that average mortgage rates are only a general benchmark. If you have good credit and strong personal finances, there’s a good chance you’ll get a lower rate than what you see in the news. So check with a lender to see what you qualify for.