Here Are Today's Best Mortgage & Refinance Rates for October 2, 2020

Borrowers with 700 credit scores were quoted an average rate of 3.454% to secure a 30-year fixed-rate purchase mortgage on Thursday, according to Money's daily survey of over 8,000 lenders across the United States. At this credit score, roughly the national average, the rate for a 30-year refinance was 4.336%. Our rates include discount points and are for borrowers putting 20% down.

Borrowers in Alaska were quoted the lowest mortgage rates on Thursday — at 3.242%. Those in Georgia saw the highest average rate at 3.685%. Nationwide, borrowers with the highest credit scores, 740 and above, were quoted rates averaging 3.004%, while those with credit of 640 or below were given rates of 4.738% — a 1.734 percentage-point spread.

You may be able to negotiate a lower rate if you shop around or if you have other accounts with the lender. (Money's picks for the best mortgage lenders are here.) Currently, some banks are hiking up advertised rates to keep demand in check, so you may be offered a lower rate if you reach out directly.

Freddie Mac's widely quoted Primary Mortgage Market Survey put rates at 2.88% with 0.8 points paid for the week ending October 1. The mortgage purchaser's weekly survey reflects borrowers who put 20% down on conforming loans and have excellent credit.

Refinance rates today

Money's survey also shows that the offered rate for a 30-year refinance for someone with a 740 credit score was 3.587% on Thursday. Last October, the average mortgage rate (including fees) was 3.859%.

A homeowner with a $200,000 mortgage balance currently paying 3.859% on a 30-year loan could potentially cut their monthly payment from $939 to $908 by financing at today's lower rates. To determine if it's worth it to refinance your mortgage, also consider the closing fees you paid on your current mortgage, how much your new lender is charging and how long you have left on your loan term. (Our picks for the best lenders for refinancing are here).

What else is happening in the housing market right now?

In a sign that the economic recovery may be slowing down, according to the Department of Labor, the job market added 661,000 to non-farm payrolls in September, well below the 800,000 anticipated by economists. The gains were led by an increase of 318,000 in leisure and hospitality, followed by retail (142,000) and healthcare and social assistance (102,000).

The unemployment rate dropped by 0.5 percentage points to 7.9% while the number of unemployed dropped by 1 million to 12.6 million. While both numbers have declined for the past five months, they remain well above the total for February, indicating that there is still a long way to go before a full recovery can be achieved. The unemployment rate is 4.4% higher than in February, while the number of unemployed is 6.8 million higher.

"The economic recovery is showing signs of running out of steam, as many of the programs acting as safety nets, like the $600 per week enhanced unemployment benefit, run out of funds. In turn, personal incomes declined 2.7 percent in August, leading to a slow down in consumer spending as summer tapered off,” said George Ratiu, senior economist at Realtor.com. “The employment trends are creating a divide between consumers who still have jobs and those who are unemployed. Looking forward, low mortgage rates will likely keep demand robust as many buyers who still have their jobs are on the hunt. However, with real estate price growth more than doubling wage growth, many buyers will struggle with affordability.”

A total of 12 million jobs have been recovered since mid-March when COVID-related shutdowns caused a loss of 22 million jobs.

Bottom line:

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