Mortgage and refinance rates for May 2, 2025: Average rates fall across all loan terms ahead of key jobs report

Average mortgage rates are dropping across popular terms as of Friday, May 2, 2025, rounding out the week with the 30-year fixed benchmark under 6.80%. An anticipated employment report due out today is expected to show weaker job growth for April and a steady 4.2% unemployment rate. It may not have as much influence on the Federal Reserve’s decision for benchmark interest rates next week, with traders betting on a 95% chance the Fed holds rates at 4.25% to 4.50%, according to CME FedWatch. Stable job growth is critical to the Fed’s ability to keep interest rates unchanged while policymakers monitor the impact of President Trump’s first 100 days in office, including evolving tariffs, tax cuts and immigration enforcement.

If you’re aspiring to buy a home this spring, now’s the time to shop around for a mortgage and lock in the lowest rate you’re eligible for to hedge against future swings.

The current average rate for a 30-year fixed mortgage is 6.76% for purchase and 6.70% for refinance, down 9 basis points from 6.85% for purchase and 10 basis points from 6.80% for refinance this time last Friday. Rates on a 15-year mortgage stand at an average 5.93% for purchase and 6.11% for refinance, down 13 basis points from 6.06% for purchase and 5 basis points from 6.06% for refinance over the past week. The average rate on a 30-year fixed jumbo mortgage is 6.80%.

⭐️ Must read: 6 ways to get the lowest rate on your next mortgage right now

Purchase rates for Friday, May 2, 2025

Refinance rates for Friday, May 2, 2025

Source: Bankrate lender survey

Mortgage rates are determined by many factors that include inflation rates, economic conditions, housing market trends and the Federal Reserve’s target interest rate. Lenders also consider your personal credit score, the amount available for your down payment, the property you’re interested in and other terms of the loan you’re requesting, like 30-year or 15-year offers.

Because rates can fluctuate daily, it’s best to lock in a mortgage rate when you’re comfortable with the overall conditions of your mortgage or home loan.

Dig deeper: How to shop for a mortgage: A step-by-step guide for smart homebuyers in 2025

Freddie Mac weekly mortgage report: Rates continue decline

Freddie Mac reports an average 6.76% for a 30-year fixed-rate mortgage, down 5 basis points from last week’s average 6.81%, according to its weekly Prime Mortgage Market Survey of nationwide lenders published on May 1, 2025. The fixed rate for a 15-year mortgage is 5.92%, down 2 basis points from last week’s average 5.94%. These figures are lower compared to a year ago, when rates averaged 7.22% for a 30-year term and 6.47% for a 15-year term.

“Mortgage rates again declined this week,” says Sam Khater, Freddie Mac’s chief economist, of the latest data. “In recent weeks, rates for the 30-year fixed-rate mortgage have fallen even lower than the first quarter average of 6.83%.”

Freddie Mac updates its Prime Mortgage Market Survey data weekly on Thursdays at noon ET.

4 top factors that affect your mortgage rate

The difference of even half a percentage point on your interest rate can save you hundreds of dollars a month and thousands of dollars over the life of your mortgage, but the mortgage rate you’re ultimately offered depends on the mortgage you’re interested in, payments you’re willing to pay up front and your overall financial health.

• Your credit score. Knowing your credit score can help you shop around for lenders you’re likely to get approval through, as well as understand the type of mortgage for your lifestyle and income. The best mortgage rates go to borrowers with good to excellent credit — typically a FICO credit score of at least 670 — though even with fair credit, you may be able to find a mortgage offering decent rates.

• Your down payment. The more money you can put down toward your home, the better it benefits your interest rate. Paying at least 20% of your home’s purchase price up front generally results in a lower interest rate — and you can avoid mortgage insurance, which increases your total cost.

• Your loan term. While the 30-year mortgage remains a popular way for Americans to purchase homes, you can find terms of 20 years, 15 years and 10 years. Shorter loan terms usually come with lower interest rates, though with higher monthly payments. Longer mortgage terms can result in smaller monthly payments, though you’ll pay higher total interest over the life of your loan.

• Interest rate type. Mortgage rates come with two basic types of rates — fixed and variable. Fixed-rate mortgages offer a consistent interest rate over the life of your loan, whereas adjustable-rate mortgages (ARMs) often start with a lower fixed rate for an agreed-on time and then adjust to a variable rate based on market conditions for the remainder of your term. Choosing between these two rates depends on your financial goals and tolerance for risk.

Prequalification vs. preapproval: What’s the difference?

Both processes help you determine how much house you can afford, though each in a different way. Think of prequalification as a quick peek into your wallet: It gives you a rough idea of what you can borrow based on the most basic information only. Preapproval, on the other hand, is when a lender takes a deeper dive into your finances to give you a more precise and reliable estimate of how much they’re willing to lend you. Learn more about these important steps of the homebuying journey in our comprehensive guide to prequalification and preapproval.

Dig deeper: How much does a change in mortgage rates actually matter?

Mortgage rates in the news

Mortgage lenders keep a close eye on the benchmark federal funds target interest rate set by the Federal Reserve, the U.S.’s central bank. Called the Fed rate, it’s the benchmark that affects rates on deposit accounts, loans and other financial products. Typically, as the fed rate rises, so do APYs on savings products like CDs, high-yield savings accounts, money market accounts and home equity loans. Mortgage rates don’t follow the Fed rate as closely, but they do reflect the same elements the Fed evaluates when making decisions on the benchmark — especially inflation — which means as the Fed rate increases, mortgage rates also tend to rise.

After increasing the target interest rate 11 times from March 2022 to July 2023 in an effort to combat the highest inflation in four decades coming out of the pandemic, the Federal Reserve announced a highly anticipated half-point cut to its federal funds target interest rate on September 18, followed by two additional quarter-point cuts after its November and December policy meetings.

March 19, 2025: Fed pauses rate cuts for a second time

At the end of its second rate-setting policy meeting of the year, on March 19, 2025, the Fed announced holding the federal funds target interest rate steady at a range of 4.25% to 4.50%. It marks the second time the Fed’s paused a rate change since its three back-to-back cuts in September, November and December, dropping the Fed rate by a full percentage point in its continued focus on getting the inflation rate closer to an average 2%.

In its post-meeting statement, the Federal Reserve said it was maintaining the target range in its continuing effort to achieve “maximum employment” and tame inflation to 2%.

“The unemployment rate has stabilized at a low level in recent months, and labor market conditions remain solid,” the Fed said in its statement, noting, “Uncertainty around the economic outlook has increased.”

“In considering the extent and timing of additional adjustments,” the Fed said it would “carefully assess incoming data, the evolving outlook, and the balance of risks.”

The Fed also updated its economic projections that show officials expecting to make two quarter-point cuts in 2025 against an uncertain outlook that anticipates slower growth and higher inflation ahead.

What to expect at the Fed’s next policy meeting: May 6–7, 2025

The Federal Reserve is expected to hold the Fed rate at 4.25% to 4.50% after its policy meeting on May 6 and May 7, 2025. The CME FedWatch Tool, which measures market expectations for Fed fund rate changes, predicts a more than 90% chance that the Fed will keep rates where they are.

Economists are keeping a close eye on inflation and labor reports amid speculation as to timing of future cuts to the Fed rate, with data indicating sticky inflation from a peak of 9.1% in June 2022 to rates that have ranged from 2.5% and 4% since May 2023.

Fresh jobs data released on April 4 from the Bureau of Labor Services showed employers adding 228,000 jobs to payrolls in March — far surpassing projections and exceeding 151,000 posted for February. Unemployment rose slightly higher to 4.2% in March, up from 4.1% in February but within the narrow range of fluctuation since May 2024.

The consumer price index released on April 10 showed the annual inflation rate easing to 2.4% in March, cooler than forecast and lower than the 2.8% reported in February. Overall prices fell 0.1% for the month — the first monthly decline since May 2020 — driven by lower energy costs as gasoline prices dropped 6.3% and decreases in travel expenses. This cooling trend was reinforced by the producer price index released on April 11, which showed wholesale prices falling 0.4% in March — the largest monthly decline since October 2023 — with gasoline prices plunging 11.1%. The PPI’s annual increase slowed to 2.7%, adding to signs of moderating inflation. While economists welcomed this inflation reprieve, many caution that President Trump’s trade developments and 90-day pause on “reciprocal” tariffs will lead to faster price growth.

During prepared remarks in Chicago on April 16, Federal Reserve Chair Jerome Powell acknowledged the difficult situation of President Trump’s sweeping tariffs on the Fed’s future policy decisions: “For the time being, we are well positioned to wait for greater clarity before considering any adjustments to our policy stance.”

The Powell-led rate-setting panel will announce a rate decision at the conclusion of its meeting next week on Wednesday, May 7, 2025, at 2 p.m. ET.

Dig deeper: When’s the next Federal Reserve meeting? What to expect — and how it affects your finances

Other stories in our mortgages and homebuying series

• How to shop for a mortgage: A guide for homebuyers in 2025

• 4 popular mortgage loans for homebuyers: Conventional, FHA, VA and jumbo loans

• When should you refinance your mortgage?

• How much does a 1% rate change matter to your mortgage?

• What is a mortgage rate lock?

• How to refinance your ARM into a fixed-rate mortgage

Frequently asked questions about mortgage rates

Learn more in these common questions about how mortgages work when narrowing down the best for your budget and financial goals. And take a look at our growing library of personal finance guides that can help you save money, earn money and grow your wealth.

What are mortgage lenders?

Lenders are financial institutions that loan money to homebuyers. A lender is different from a loan servicer, which typically handles the operational tasks of your loan, like processing payments, talking directly with borrowers and sending monthly statements.

What does it mean to refinance a mortgage?

Refinancing is a process of trading in your current mortgage to another lender for lower rates and better terms than your current loan. With a refinance, the new lender pays off your old mortgage and you then pay your monthly statements from the new lender. Learn more about how the process works in our guide to timing your refinancing.

I’ve owned a home in the past. Can I still qualify for homebuyer assistance?

Yes. While many homebuyer assistance programs are for first-time buyers, both the IRS and the Department of Housing and Urban Development (HUD) consider you a first-time homebuyer if neither you nor your spouse has owned a principal residence within the past three years. Learn more about programs that might be available to you — even if you’ve already owned a home — in our guide to homebuyer assistance.

What is an adjustable-rate mortgage?

An adjustable-rate mortgage — commonly called an ARM — is a type of home loan with a variable rate. Unlike a fixed-rate mortgage, which locks in an interest rate and predictable payments that apply over the full loan term, an ARM starts at an initial fixed rate for a period of three years or longer, after which it adjusts to a higher rate and then further adjusts periodically over the remaining life of the loan.

For a 5/1 adjustable-rate mortgage, the first number indicates the number of years at the fixed rate — or five years — and the second number indicates the rate at which the mortgage rate readjusts after — in this case, each year or annually. Learn more about how to convert your ARM to a fixed-rate mortgage in our guide to refinancing your adjustable-rate mortgage.

Can I negotiate my mortgage rate?

It’s not likely — lenders consider the market conditions and other financial factors when determining rates. You can, however, ask about how you can reduce costs in other ways when comparing mortgage lenders. For instance, many lenders offer lower rates in exchange for “mortgage points” — upfront fees you pay to your lender. A mortgage point could cost 1% of your mortgage amount, which means about $5,000 on a $500,000 home loan, with each point lowering your interest rate by about 0.25%, depending on your lender and loan. Learn more in our guide to getting the lowest rate on your next mortgage.

What happens to my mortgage after I die?

Your home’s mortgage is treated a little differently from your other debt, which is typically settled through your estate before any assets are passed along to your heirs. Most mortgages aren’t transferable, which means the home must be paid off in full to transfer the property title.

But that also means only those who signed on to the loan can be held liable for a mortgage. Learn more about what happens to your mortgage after death.

I already own a home. Can I borrow against my home’s equity to cover a high-dollar or unexpected cost?

Yes. If it’s cash you’re after to pay for home renovations, pay off high-interest credit card debt or cover an emergency, tapping into your home’s value is a way to unlock lower rates without refinancing — and without losing your low-rate mortgage. You typically need good to excellent credit and to have built enough equity in your home. Learn how to get equity out of your home as rates come down.

Editor’s note: Rates shown are as of Friday, May 2, 2025, at 6 a.m. ET. APYs and promotional rates for some products can vary by region and are subject to change.

Sources

• Mortgage Industry Insights, Bankrate. Accessed May 2, 2025.

• Primary Mortgage Market Survey, Freddie Mac. Accessed May 2, 2025.

• Employment Situation Summary, U.S. Bureau of Labor and Statistics. Accessed April 7, 2025.

• Consumer Price Index Summary, U.S. Bureau of Labor and Statistics. Accessed April 11, 2025.

• Producer Price Index News Release summary, U.S. Bureau of Labor and Statistics. Accessed April 14, 2025.

• CME FedWatch Tool, CME Group. Accessed May 2, 2025.