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Published: Oct 09, 2020 6 min read

The average rate for a 30-year fixed-rate purchase mortgage was 3.487% on Thursday. The average rate for a 30-year refinance was 4.342%.

Money's current mortgage rates include data from 8,000 lenders across the United States and are updated daily. The rates include points and represent what a borrower with a 20% down payment and 700 credit scores — roughly the national average FICO score — would have been quoted.

30-year fixed-rate purchase mortgage
Rate of October 8, 2020

Mortgage rates vary from state to state. On Thursday, borrowers in Alaska were quoted the lowest mortgage rates — at 3.327%. People looking for mortgages in Nevada saw the highest average rate at 3.695%. Nationwide, borrowers with the highest credit scores, 740 and above, were quoted rates averaging 3.022%, while those with credit of 640 or below were shown rates of 4.725% — a 1.703 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 2.87% with 0.8 points paid for the week ending October 8. 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 3.683% on Thursday. Last October, the average mortgage rate (including fees) was 3.859%.

30-year fixed-rate mortgage refi
Rate of October 8, 2020

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 $919 by financing at the current 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 year when the housing market has behaved in every way but normal, could the upcoming presidential election be affected by the shift from more densely populated areas to more rural settings created by the COVID-19 pandemic?

More people are leaving what have traditionally been considered politically liberal areas for more conservative ones in search of more affordable housing and space, according to a survey by real estate brokerage Redfin. According to the firm's home search data, during the second quarter of 2020 6.5% more searchers were looking to move to red (traditionally Republican) or swing counties than to blue (traditionally Democratic) counties.

Counties located in 13 swing states were the most popular searches by those looking to move to different areas. About 9% more buyers were looking to move to red or swing counties, while only 1.8% more buyers were looking to move to blue counties. A record 27% of home searchers were looking to move from one metro area to another, with most of them looking to leave areas like California and New York for cities in Arizona, Texas, Florida and North Carolina.

"The Democratic presidential candidate could win Arizona for the first time in 24 years, in part due to this year's pandemic driven migration," said Taylor Marr, Redfin economist. "The rise in remote work means people with a wide variety of political views have the freedom to leave heavily blue cities like New York and San Francisco for more affordable places like Phoenix. There is evidence from polling and voter registration trends that some liberal people who have left California since the last election are landing in Arizona and bringing their votes with them."

The allure of areas that have typically been viewed as red is much more likely to be related to the pandemic than anything else. Red areas tend to be more rural, which means more space but also more affordable. The typical home in a blue county sold for $346,000 during the month of August, compared to $209,000 in red counties and $259,000 in swing counties. At a time when social distancing is necessary and remote work is making proximity to workplaces less important, rural areas are much more attractive.

“It seems like there is a growing sense of nostalgia among homebuyers. I’ve heard several buyers express the desire to raise their family in a quiet small town like the one where they grew up, especially now that city living is less attractive with the closure of stores and restaurants and civil unrest," said Brian Callahan, a Redfin managing broker in Wisconsin. "One buyer is looking for a farm to recapture memories from his grandparents’ property and recreate the experience for his children.”

Bottom line:

Procrastinators, It's Not Too Late to Refinance Your Mortgage and Save Thousands

Everyone Wants to Buy a House Right Now. 9 Experts Predict How Long Demand Will Soar

Get to Know the 'Leaseback,' the Pandemic House Selling Trend Where no Move Is Required