Lowest Mortgage Rates Across the States - July 16, 2025: A Breakdown

In the ever-changing landscape of the housing market, understanding mortgage rates is crucial for prospective homebuyers. Here's a breakdown of key factors influencing mortgage rates across different states and some advice for securing the best deal.

Shopping around and getting quotes from multiple lenders is essential when looking for a mortgage. This practice allows you to compare not just the interest rate, but also fees and closing costs, ensuring you find the most favourable terms.

Mortgage rates can vary significantly from state to state due to several key factors. One such factor is competition among lenders. Not all lenders operate in every state, which affects competition levels. Higher competition typically leads to lower rates as lenders vie for customers.

Another factor is the average credit score of a state's population. States with higher average credit scores may see lower mortgage rates, as lenders perceive these borrowers as lower risk. The size of loans also plays a role, with larger loans, common in pricier markets, influencing rates due to increased risk assessments.

State-level regulations, risk management strategies, and economic conditions can also impact mortgage rates. Real estate laws and regulations vary across states, affecting the cost of doing business for lenders. Lenders employ different risk management strategies, which can result in varying rates based on how they assess and mitigate risk in different markets. Economic conditions, such as local economic health and housing demand, can indirectly influence mortgage rates by affecting local market conditions and lender perceptions of risk.

Analysts predict that mortgage rates could decline to around 5% by 2028. However, the Federal Reserve (The Fed) is signaling potential rate cuts later in 2025, although the timing and magnitude are still being debated.

Investing in turnkey real estate can help secure consistent returns in a fluctuating mortgage rate environment. It's important to remember that the cheapest rate may not be the best option in the long run. Consider the overall market and your personal financial situation before making a decision.

The current national average for a 30-year fixed mortgage is 6.91%. The states with the cheapest 30-year new purchase mortgage rates are New York, New Jersey, California, Florida, Georgia, and Pennsylvania, with average rates between 6.79% and 6.89%. On the other hand, some states with higher mortgage rates include Alaska, West Virginia, New Mexico, Washington, D.C., Kansas, Nebraska, Vermont, Iowa, South Dakota, and Wyoming, with average rates between 6.96% and 7.03%.

It's also worth noting that fixed-rate mortgages and adjustable-rate mortgages (ARMs) have different implications. ARMs offer a lower initial rate that could increase over time. Currently, an adjustable-rate mortgage (5/6 ARM) is at 7.44%, while the current average for a 15-year fixed mortgage is 5.95%. FHA 30-year fixed mortgages average around 7.55%, and jumbo 30-year fixed mortgages have an average rate of 6.84%.

Paying points upfront can help "buy down" the interest rate, but this strategy is beneficial if you plan to stay in the home for a long time. Improving your credit score before applying for a mortgage can also secure a better rate.

In conclusion, understanding the factors influencing mortgage rates and shopping around for the best deal are key to securing a favourable mortgage. Keep an eye on market trends and work closely with a trusted lender to navigate the mortgage landscape effectively.

A strategic approach to mortgage shopping involves getting quotes from multiple lenders to compare not just the interest rate, but also fees and closing costs, ensuring a favourable terms.
Higher competition among lenders in a state results in lower mortgage rates, as lenders vie for customers in these areas.
States with higher average credit scores may see lower mortgage rates, as lenders perceive these borrowers as lower risk.
Economic conditions, such as local economic health, housing demand, and real estate laws and regulations, can indirectly influence mortgage rates.
Analysts predict that mortgage rates could decline to around 5% by 2028, but there may be potential rate cuts later in 2025 as signaled by the Federal Reserve.
Investing in turnkey real estate can help secure consistent returns in a fluctuating mortgage rate environment, but it's essential to consider the overall market and one's personal financial situation before making a decision.
In the current market, the states with the cheapest 30-year new purchase mortgage rates include New York, New Jersey, California, Florida, Georgia, and Pennsylvania, while some states with higher mortgage rates include Alaska, West Virginia, New Mexico, Washington, D.C., Kansas, Nebraska, Vermont, Iowa, South Dakota, and Wyoming.