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Published: Feb 01, 2021 6 min read
Money; Getty Images

The average rate on a 30-year fixed-rate mortgage was 3.107% on Friday — up from 3.053% Thursday.

Pending home sales reached their highest level ever for the month of December, in spite of a decline from the previous month.

Today’s Mortgage Rates: 30-Year Fixed Loans, 15-Year Fixed Loans, and More

Mortgage Rate Chart
Loan type Average Rate
30-Year Fixed Loan 3.107%
15-Year Fixed Loan 2.339%
30-Year FHA Loan 2.947%
30-Year VA Loan 2.981%
30-Year Jumbo Loan 3.613%
Source: Money | Date: Jan. 29, 2021 | Rates assume a credit score of 700

Money's daily mortgage rates show the average rate offered by over 8,000 lenders across the United States the previous business day. The rates reflect what a typical borrower with a 700 credit score might expect to pay for a home loan right now. These rates were offered to people putting 20% down and include discount points.

Our daily rates are generally higher than the weekly benchmark rate published by Freddie Mac, which are for buyers with the highest credit scores.

Money's daily mortgage data also shows that borrowers with the highest credit scores — 740 and above — were offered a rate of 2.902% on average. People will lower credit scores — 620 or below — were shown rates of 4.131%.

How do I get the lowest mortgage rate?

You may be able to negotiate a better mortgage rate if you shop around or if you have other accounts with the lender. (To get started, take a look at Money's picks for the best mortgage lenders.) Lately, some lenders have been hiking up advertised rates to keep demand in check, so you may be offered a lower rate if you reach out directly.

Mortgage rates vary also from state-to-state. On Friday, borrowers in Illinois were quoted the lowest mortgage rates — at 3.053%. People looking for mortgages in Nevada saw the highest average rate at 3.167%.

Today's Refinance Rates

Today's survey also shows that the offered rate for a 30-year refinance for someone with a 740 credit score was 3.191% on Friday. In February 2020, the average mortgage rate (including fees) was around 3.8%.

Mortgage Refinance Rate Chart
Loan type Average Rate
30-Year Fixed Loan 3.191%
15-Year Fixed Loan 2.594%
30-Year FHA Loan 3.392%
30-Year VA Loan 3.419%
30-Year Jumbo Loan 3.541%
Source: Money | Date: Jan. 29, 2021 | Rates assume a credit score of 740

What else is happening in the housing market today

Pending home sales ticked down in December according to the National Association of Realtors, decreasing by 0.3% from the previous month. It marked the fourth straight monthly decline. However, when compared with December of 2019, pending sales were 21.4% higher.

With the decrease, the Pending Home Sales Index slid to 125.3 — the highest reading ever for the month of December. The index's baseline is 100, which is equal to the level of contract activity in 2001. The month-over-month decline was due to fewer contract signings in the Midwest region. Signings in the Northeast, South, and West regions were either unchanged or slightly higher than in November.

"Pending home sales contracts have dipped during recent months, but I would attribute that to having too few homes for sale," said Lawrence Yun, NAR's chief economist.

Yun went on to point out that buyer demand is still high and that he expects sales to increase when more new listings come on the market. However, until there is more inventory on the market, there should be continued upward pressure on home prices.

Looking forward to the rest of 2021, Yun projects that the economy will experience strong economic growth thanks to low mortgage rates and increased fiscal stimulus. In turn, existing home sales should see a boost. Yun believes existing home sales could reach 6.49 million during the year, which would be an increase of 15% over 2020. He also expects home prices to rise, but at a slower pace than last year.

"There will also be slower home price appreciation, likely 6.6%, as increased confidence from homebuilders will ultimately lead to an increase in housing starts," he added.

Mortgage Term of the Week

Understanding the lingo can be key to avoiding mistakes when you are buying a home or refinancing your mortgage. For more read: Everything You Need to Know About Mortgage Rates in 2020.

High-Ratio Loan: A loan where the value of the loan exceeds 80% of the value of the home. A loan where the down payment is less than 20% is a high-ratio loan.

More from Money:

You're Only Ready to Buy a House if You Can Answer 'Yes' to These 7 Questions

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Rates are subject to change. All information provided here is accurate as of the publish date.