Mortgage Rates Today July 21, 2025: Purchase Rates Stable, Refinance Rates Rise

As of today, July 21, 2025, mortgage rates show a slight decrease or stability in most categories, with the national average 30-year fixed mortgage rate holding steady at 6.87%, down just 0.01% from the previous week. However, refinance rates have inched up somewhat, with the 30-year fixed refinance rate climbing slightly to 7.17%, up 0.04% from last week. These figures indicate a market where purchase mortgage rates are steady or slightly improving, but refinancing has grown a bit more costly recently.

Mortgage Rates Today July 21, 2025: Purchase Rates Stable, Refinance Rates Rise

Key Takeaways

• 30-Year Fixed Mortgage Rate: Stable at 6.87%, minor decrease from last week.
• 15-Year Fixed Mortgage Rate: Stable around 5.90%.
• 5-Year ARM Mortgage Rate: Slight decrease to 7.76%.
• 30-Year Fixed Refinance Rate: Increased to 7.17%.
• 15-Year Fixed Refinance Rate: Increased to 5.98%.
• Market Outlook: Experts predict mortgage rates may slightly drop in late 2025 and 2026.
• Loan Types: Government-backed loans typically offer lower rates than conforming loans.
• Rates Impact: Slight increases in refinance rates may affect homeowners looking to tap equity.

Overview of Current Mortgage Rates

Mortgage rates are a critical factor for homebuyers and those looking to refinance. Today’s mortgage environment reflects some stability in purchase mortgage rates but a mild rise in refinance costs.

Loan Type	Rate (July 21, 2025)	Weekly Change	APR	APR Change
30-Year Fixed (Conforming)	6.87%	Down 0.01%	7.32%	Down 0.02%
20-Year Fixed (Conforming)	6.87%	Up 0.16%	7.36%	Up 0.33%
15-Year Fixed (Conforming)	5.90%	Down 0.03%	6.19%	Down 0.03%
10-Year Fixed (Conforming)	6.03%	No change	6.12%	No change
7-Year ARM (Conforming)	7.96%	Up 0.38%	8.36%	Up 0.39%
5-Year ARM (Conforming)	7.76%	Down 0.07%	8.10%	Down 0.02%

Source: Zillow (July 21, 2025)

Government-backed loans, such as FHA and VA loans, generally offer slightly lower interest rates.

Government Loan Type	Rate (July 21, 2025)	Weekly Change	APR	APR Change
FHA 30-Year Fixed	6.58%	Down 0.69%	7.63%	Down 0.68%
VA 30-Year Fixed	6.32%	Down 0.05%	6.54%	Down 0.04%
FHA 15-Year Fixed	5.44%	Down 0.02%	6.46%	Down 0.01%
VA 15-Year Fixed	5.81%	Down 0.08%	6.17%	Down 0.07%

Understanding Why Government Loan Rates Tend to Be Lower Than Conforming Loans

Government loans such as FHA and VA loans generally have lower rates because:

• They are insured or guaranteed by the government, which reduces lender risk.
• They often target first-time homebuyers or veterans, groups that may have less access to traditional credit.
• They come with limits on loan amounts and borrower criteria which affect risk profiles.

This lower risk to lenders translates to more favorable interest rates for borrowers.

Current Refinance Rates Overview

Refinancing allows homeowners to replace their existing mortgage with a new one, often to benefit from lower rates or tap into home equity. Recent trends show a modest increase in refinance rates:

Refinance Loan Type	Rate (July 21, 2025)	Weekly Change
30-Year Fixed Refinance	7.17%	Up 0.04%
15-Year Fixed Refinance	5.98%	Up 0.05%
5-Year ARM Refinance	7.91%	Up 0.02%

This rise is noteworthy because refinancing costs more even as purchase mortgage rates are steady or slightly lower. Homeowners will need to weigh these differences carefully.

Example: Impact of Mortgage Rate Changes on Monthly Payments

Let’s consider a $350,000 loan for a home purchase with a 30-year fixed mortgage:

• At today's rate of 6.87%, the monthly principal and interest payment is roughly $2,306.
• If rates drop to the predicted 6.4% later this year, monthly payments could decrease to about $2,197, saving $109 per month.
• Conversely, if refinancing rates climb to 7.17%, the monthly payment on the same amount would be around $2,371, costing $65 more than the current purchase mortgage rate.

Long-Term Mortgage Rate Predictions and Market Insights

Several industry experts and organizations have put forward forecasts based on economic data, inflation trends, and housing market conditions.

• National Association of Realtors (NAR): Chief Economist Lawrence Yun forecasts mortgage rates to average 6.4% in the second half of 2025 and fall to 6.1% in 2026. This optimistic forecast is tied to expectations of increased home sales and supply improvements.
• Fannie Mae: Predicts rates will top out near 6.5% in 2025 and decrease slightly to 6.1% in 2026, paralleling GDP growth projections.
• Mortgage Bankers Association (MBA): Expects mortgage rates to stay in the mid-6% range through 2025, ending near 6.7%, and stabilizing around 6.3% in 2026.
• Morgan Stanley: Suggests that mortgage rates might drop with Treasury yields if the U.S. GDP slows down, offering potential improvement in affordability, especially if rates fall closer to 6.25%.

The consensus is that while rates have stabilized somewhat, the potential for moderate declines exists, benefiting homebuyers in the near future.

How Mortgage Rates Affect the Housing Market

Mortgage rates influence buying power and market dynamics profoundly:

• Higher rates tend to reduce affordability, slowing home sales.
• Rate declines can stimulate demand, boosting sales and construction.
• Continued stable or slightly dropping rates may encourage more buyers off the sidelines compared to last year when buyers waited for rate drops.
• Refinance rate increases may limit homeowners' appetite to tap home equity or reduce monthly payments.

These dynamics interact with broader economic factors like inflation, wage growth, and housing supply to shape the market landscape.

Conforming vs. Government Loans: APR Differences

In addition to interest rates, APR (annual percentage rate) includes fees and points, offering a fuller picture of borrowing cost.

Loan Type	Interest Rate	Typical APR Difference	Reason
Conforming 30-Year Fixed	~6.87%	~+0.40%	More fees, broader lender risk
FHA 30-Year Fixed	~6.58%	~+1.00%	Upfront mortgage insurance
VA 30-Year Fixed	~6.32%	~+0.22%	Funding fees vary by case

Note: FHA loans often have lower interest rates but higher APR due to mortgage insurance costs.

Refinancing Trends and Why Refinance Rates May Rise While Purchase Rates Stay Steady

Refinancing involves different risks and market factors than purchase mortgages:

• Lenders price refinance loans higher due to increased risk of borrower default.
• Homeowners refinancing today may have older mortgages with lower locked-in rates, reducing their incentive to refinance unless rates drop significantly.
• Market liquidity and mortgage-backed securities demand affect refinance rate pricing.
• Inflation and Fed policy changes impact borrowing costs differently over time.

Final Thoughts on Mortgage Rates Today

The mortgage market as of July 21, 2025, presents a mixed picture: purchase mortgage rates show slight improvements or stability, while refinance rates have edged upward. The data suggest a market still influenced by economic variables but moving toward a phase of rate moderation.

Those monitoring mortgage and refinance rates today will want to stay informed of economic indicators, Federal Reserve signals, and housing inventory trends, as these will continue shaping mortgage rate movements going forward.