Today’s Mortgage, Refinance Rates: Oct. 8, 2022

Insider’s experts choose the best products and services to help make smart decisions with your money (here’s how). In some cases, we receive a commission from our our partners, however, our opinions are our own. Terms apply to offers listed on this page.

Mortgage rates have inched back up after briefly falling earlier this week.

Rates have been rising rapidly this year largely due to inflation. The Federal Reserve has been raising the federal funds rate to try to slow the economy, and it will continue to do so until inflation shows sustained signs of slowing to its target annual rate of 2%.

Fed Chair Jerome Powell has indicated that the Fed is closely watching the labor market for signs of softening, which it believes will take some of the upward pressure off prices. 

“The labor market continues to be out of balance, with demand for workers substantially exceeding the supply of available workers,” Powell said in a press conference following the Fed’s September meeting.

The labor market has so far remained relatively strong, though it’s showing signs of cooling. In September, the economy added 263,000 jobs, the Bureau of Labor Statistics announced Friday. This was a deceleration from the 315,000 jobs added in August, but still higher than expected. The unemployment rate also dropped to 3.5%.

A still-strong labor market means the Fed has room to enact more large hikes to the federal funds rate, which means a 75-basis-point increase is possible at its next meeting.

What does this mean for mortgage rates? The federal funds rate doesn’t directly impact mortgage rates, but investor expectations around how Fed policy will impact the economy can. Rates are likely to remain at their current levels, and they could trend up further this year — possibly past 7%.

Today’s mortgage rates

Today’s refinance rates

Mortgage calculator

Use our free mortgage calculator to see how today’s interest rates will affect your monthly payments:

By clicking on “More details,” you’ll also see how much you’ll pay over the entire length of your mortgage, including how much goes toward the principal vs. interest.

Are mortgage rates going up?

Mortgage rates started ticking up from historic lows in the second half of 2021 and have increased significantly so far in 2022.

In the last 12 months, the Consumer Price Index rose by 8.3%. The Federal Reserve has been working to get inflation under control, and is expected to increase the federal funds target rate two more times this year, following increases at its last five meetings.

Though not directly tied to the federal funds rate, mortgage rates are sometimes pushed up as a result of Fed rate hikes and investor expectations of how those hikes will impact the economy.

Inflation remains elevated, but has started to slow, which is a good sign for mortgage rates and the broader economy. 

What do high rates mean for the housing market?

When mortgage rates go up, home shoppers’ buying power decreases, as more of their anticipated housing budget has to go toward paying interest. If rates get high enough, buyers can get priced out of the market completely, which cools demand and puts downward pressure on home price growth.

Home prices have continued to rise this year, just at a slower pace than what we’ve seen in the past couple of years.

What is a good mortgage rate?

It can be hard to know if a lender is offering you a good rate, which is why it’s so important to get preapproved with multiple mortgage lenders and compare each offer. Apply for preapproval with at least two or three lenders.

Your rate isn’t the only thing that matters. Be sure to compare both what your monthly costs would be as well as your upfront costs, including any lender fees.

Even though mortgage rates are heavily influenced by economic factors that are out of your control, there are some things you can do to help ensure you get a good rate:

• Consider fixed vs. adjustable rates. You may be able to get a lower introductory rate with an adjustable-rate mortgage, which can be good if you plan to move before the intro period ends. But a fixed rate could be better if you’re buying a forever home because you won’t risk your rate going up later. Look at the rates your lender offers and weigh your options.
• Look at your finances. The stronger your financial situation, the lower your mortgage rate should be. Look for ways to boost your credit score or lower your debt-to-income ratio, if necessary. Saving for a higher down payment also helps.
• Choose the right lender. Each lender charges different mortgage rates. Picking the right one for your financial situation will help you land a good rate.