Mortgage rates on Thursday, July 31, 2025, remain largely unchanged, according to Zillow Home Loans. The average 30-year fixed rate stands at 6.625%, while 15-year fixed mortgages are at 5.75%. Adjustable-rate mortgages like the 7-year ARM continue to hover around 7.375%.
Today’s average mortgage rates
Here’s a snapshot of current rates by loan type from Zillow Home Loans:
- 30-Year Fixed: 6.625% (APR: 6.774%, Points: 1.522)
- 30-Year FHA: 6.125% (APR: 6.835%, Points: 1.882)
- 30-Year VA: 6.500% (APR: 6.787%, Points: 1.685)
- 20-Year Fixed: 6.500% (APR: 6.731%, Points: 1.800)
- 15-Year Fixed: 5.750% (APR: 6.014%, Points: 1.682)
Rates were last updated on July 30, 2025.
Will lower rates help affordability?
While rates have dipped slightly from their 2023 peak of 8%, affordability remains a major hurdle. A new analysis from Zillow suggests that even a drop to 4.43% would still not make the average U.S. home affordable for most buyers.
“That kind of a rate decline is currently unrealistic,” said Zillow economist Anushna Prakash.
In cities like New York, San Francisco, and Los Angeles, even 0% interest rates wouldn’t make a median-priced home affordable for many households, the report found.
What’s driving current mortgage rates?
Mortgage rates are influenced by multiple factors:
- Federal Reserve policy: While rate hikes have paused, the Fed has not yet signaled significant cuts.
- Bond market trends: Yields on 10-year Treasurys remain elevated, keeping mortgage rates high.
- Credit profiles: Higher credit scores and low debt-to-income ratios can qualify borrowers for better rates.
How to qualify for a lower mortgage rate
Buyers can improve their chances of locking in a better rate by:
- Improving credit scores
- Making a larger down payment
- Reducing existing debt
- Comparing lenders, including local credit unions and smaller banks
Some borrowers are turning to adjustable-rate mortgages (ARMs) to secure more affordable monthly payments, with plans to refinance later if fixed rates drop.
Should you buy or refinance now?
Experts are split. While waiting for rates to fall may seem logical, high home prices and limited inventory continue to challenge buyers. Many real estate agents now advise clients to buy a less-than-perfect home they can afford now, then move up later.
“It’s easier to buy your dream home once you’ve built equity,” said Philippa Main, a real estate agent and loan officer in Arlington, Virginia.
Refinancing may make sense for homeowners with ARMs or those who secured higher rates in 2023, especially if their financial situation has improved.
What happens next?
Mortgage rates may remain volatile as economic uncertainty continues and the Federal Reserve evaluates inflation trends. For now, experts say buyers should focus on financial readiness rather than trying to time the market.