Unveiling the Cheapest and Most Expensive States for Mortgage Refinance Rates

Tuesday saw California, Florida, Tennessee, Washington, Texas, Hawaii, New Hampshire, and New York registering the lowest 30-year mortgage refinance rates, between 6.80% to 6.95%. However, the highest refinance rates were recorded in West Virginia, Maryland, Alaska, Illinois, Maine, and Missouri, with a range of 30-year refinance averages from 7.03% to 7.07%. Refinance rates are not uniform and tend to vary by state due to differing lenders across regions, state-specific credit score averages, loan sizes, and regulations, as well as lenders' individual risk management strategies. Understanding this, it becomes evident why it is wise to regularly compare rates from different lenders to secure the best mortgage option for yourself. Take note, however, that the published rates may differ from the oft-advertised teaser rates online, which are typically based on repayment with points or are designed for borrowers with exceptional credit scores or for smaller-than-average loans. The actual rate obtained will depend on an individual’s credit score, income, among other factors and may deviate from the averages. On Tuesday, the rate for 30-year refinance mortgages saw a small increase of 2 basis points to a 6.98% average, a considerable rise from the recent four-month low of 6.71%. Current rates stand higher than those in September when the 30-year refi average dipped to a two-year low of 6.01%. Mortgage rates are subject to a sturdy network of macroeconomic and industry factors. Large-scale economic components managed to keep the mortgage market relatively low for a significant portion of 2021, largely due to a bond-buying policy by the Federal Reserve in response to pandemic-related economic strain, which largely influences mortgage rates. However, the tapering of bond purchases from November 2021 resulted in an increase in mortgage rates, with the Fed aggressively raising the federal funds rate to combat soaring inflation. The Federal Reserve opted to hold rates steady at the beginning of this new year, indicating possible rate-hold announcements in 2025. The reported national and state averages come from the Zillow Mortgage API and assume a loan-to-value ratio of 80% and an applicant's credit score in the 680–739 range, which means these rates may vary from advertised teaser rates.