States With Lowest Mortgage Rates Today – May, 14 2025

If you're on the hunt for the best mortgage rates, you're probably wondering which states are offering the most attractive deals. As of today, May 14, 2025, the states with the lowest 30-year new purchase mortgage rates are New York, California, North Carolina, New Jersey, Texas, and Washington, followed by a tie that includes Florida and Pennsylvania. These states boast average rates ranging from 6.82% to 6.99%, according to Zillow. Keep reading to explore why these rates vary so much and what it means for you.

States With Lowest Mortgage Rates Today – May 14, 2025

Why Do Mortgage Rates Vary by State?

It's easy to assume that mortgage rates would be fairly uniform across the country, but that's not the case. Several factors contribute to these differences:

• Lender Presence: Not all lenders operate in every state. The level of competition between lenders can drive rates down in certain areas. A smaller pool of lenders could potentially mean higher rates.
• Credit Score Averages: States with higher average credit scores may see lower rates overall. Lenders perceive borrowers in these states as less risky.
• Average Loan Size: The average loan size in a state can also impact rates. States with higher property values (and therefore larger loan amounts) might see different rates than states with smaller average loan sizes.
• State Regulations: State-specific regulations can influence the cost of doing business for lenders, which can then be reflected in mortgage rates.
• Risk Management Strategies: Each lender has its own risk management policies. This can influence the rates they're willing to offer in different markets.

Knowing all these factors, it makes perfect sense why rates differ by state. This is precisely why you need to look at the rates being offered in the state you want to buy a property from.

The Cheapest States Right Now (May 14, 2025)

Let's break down the states where you might find the most favorable mortgage rates today:

• New York: Known for its vibrant real estate market, New York consistently offers competitive mortgage rates.
• California: The Golden State, with its high property values, often sees a lot of competition among lenders, leading to lower rates.
• North Carolina: This state is becoming a more popular choice for new home buyers and investors. As more mortgage companies compete, North Carolina residents can secure attractive rates.
• New Jersey: Close to New York, this densely populated state's robust real estate market helps keep rates in check.
• Texas: With a booming economy and population growth, Texas's mortgage market is highly competitive, resulting in favorable rates.
• Washington: Fueled by the tech industry and strong job growth, Washington's real estate market offers decent mortgage rates.
• Florida & Pennsylvania (Tie): Both these states are pretty attractive, with rates remaining relatively low compared to the national average.

The Most Expensive States Right Now (May 14, 2025)

On the other end of the spectrum, some states have higher average mortgage rates. As of today, these are the states where you might encounter the most expensive rates:

• Alaska
• West Virginia
• Mississippi
• Nevada
• Maine
• Montana
• North Dakota
• South Carolina
• Wyoming

The average rates in these states range from 7.06% to 7.15%. A few factors might be contributing to the higher mortgage rates including lower population density (resulting in fewer lenders), challenging economic conditions, and/or high insurance costs.

National Mortgage Rate Trends: A Quick Look

It's not just about state-by-state differences; it's also crucial to understand the overall national mortgage rate trends. Here's a quick rundown:

• Recent Increase: 30-year new purchase mortgages have seen a slight increase, climbing to an average of 7.01%.
• Mid-April Peak: Rates surged in mid-April, hitting 7.14%, the highest since May 2024.
• March Low: Earlier in 2025, in March, rates dipped to a low of 6.50%.
• September Dip: In September of last year, 30-year rates reached a two-year low of 5.89%.

Here's a snapshot of the national averages for different loan types:

Loan Type	Rate
30-Year Fixed	7.01%
FHA 30-Year Fixed	7.37%
15-Year Fixed	6.10%
Jumbo 30-Year Fixed	7.00%
5/6 ARM	7.31%

Understanding “Teaser Rates”

You've probably seen those enticingly low mortgage rates advertised online. These are often teaser rates— rates that are cherry-picked to look attractive but might not reflect what most borrowers will actually qualify for. These rates may require you to pay points upfront, or they might be based on a borrower with an exceptionally high credit score or a very small loan (Investopedia).

Always remember that the actual rate you secure will depend on your individual circumstances, including your:

• Credit score
• Income
• Down payment
• Debt-to-income ratio

What Factors Influence Mortgage Rate Fluctuations?

Mortgage rates are a moving target, influenced by a complex interplay of factors:

• Bond Market: The direction of the bond market, particularly 10-year Treasury yields, plays a significant role.
• Federal Reserve Policy: The Fed's monetary policy, especially bond buying and funding of government-backed mortgages, affects rates.
• Competition: Competition between lenders and across different loan types can drive rates up or down.

Because multiple factors can shift simultaneously, it's difficult to pinpoint one single cause for rate changes.

My Personal Take: Expect Continued Volatility

Based on my experience in the real estate market, I expect we'll continue to see some volatility in mortgage rates throughout 2025. The Federal Reserve's decisions will remain a key driver. While they made some initial rate cuts, their hesitance to cut further suggests a cautious approach. This means we might see periods of stability followed by unexpected shifts.

As a prospective homebuyer or homeowner looking to refinance, it's vital to:

• Stay Informed: Keep a close eye on economic news and Federal Reserve announcements.
• Shop Around: Don't settle for the first rate you see. Get quotes from multiple lenders to find the best deal.
• Improve Your Credit: Even a small improvement in your credit score can lead to a lower interest rate.
• Consider Different Loan Types: Explore different loan options, such as fixed-rate, adjustable-rate, and FHA loans, to see which best suits your needs.
• Work with a Mortgage Professional: A qualified mortgage broker or lender can provide personalized advice and help you navigate the complexities of the mortgage market.

Estimate Your Mortgage Payment

To get a better sense of what you can afford, use a mortgage calculator. Here's how your monthly payment breaks down based on the example from Zillow:

• Home Price: $440,000
• Down Payment (20%): $88,000
• Loan Term: 30 years
• APR: 6.67%

In this scenario, your estimated monthly payment would be $2,649.04, including:

• Principal & Interest: $2,264.38
• Property Taxes: $256.67
• Homeowners Insurance: $128.00

Over the 30-year loan term, the total mortgage interest paid would be $463,176.16, bringing the total mortgage paid to $815,176.16.

Keep in mind that these figures are estimates. Your actual mortgage payment may vary based on your specific loan terms and circumstances.

Final Thoughts

Finding the best mortgage rate requires patience, research, and a willingness to shop around. By understanding the factors that influence rates and staying informed about market trends, you can position yourself to secure a favorable deal.

As of today, the states with the lowest mortgage rates offer a glimmer of hope for homebuyers and those looking to refinance. However, it's essential to remember that rates can change quickly, so don't delay if you find an offer that works for you.