Will Interest Rates Go Down in June 2024? | Mortgage Rates Forecast (2024)

Mortgage rate forecast for next week (May 20-24)

Mortgage interest rates came down for the second week in a row.

The average 30-year fixed rate mortgage (FRM) fell from 7.09% on May 9 to 7.02% on May 16, according to Freddie Mac.

“Given the news that inflation eased slightly, the 10-year Treasury yield dipped, leading to lower mortgage rates. The decrease in rates, albeit small, may provide a bit more wiggle room in the budgets of prospective homebuyers,” said Sam Khater, Freddie Mac’s Chief Economist.

In this article (Skip to...)

• Will rates go down in June?
• 90-day forecast
• Expert rate predictions
• Mortgage rate trends
• Rates by loan type
• Mortgage strategies for June
• Mortgage rates FAQ

Will mortgage rates go down in June?

Mortgage rates fluctuated significantly in 2023, with the average 30-year fixed rate going as low as 6.09% on Feb. 2 and as high as 7.79% on Oct. 26, according to Freddie Mac.

The range can be largely attributed to the Federal Reserve’s ongoing fight against inflation, juxtaposed with uncertainty in the banking sector sparked by Silicon Valley Bank’s collapse. However, with duress permeating the financial market and the fallout from U.S. debt ceiling talks, the Fed may continue making hikes to bring interest rates down.

With the economy possibly heading into a recession, we may have already seen the peak of this rate cycle. Of course, interest rates are notoriously volatile and could tick back up on any given week.

Experts from CoreLogic, First American, CJ Patrick and others weigh in on whether 30-year mortgage rates will climb, fall, or level off in June.

Expert mortgage rate predictions for June

Craig Berry, branch manager at Acopia Home Loans

Prediction: Rates will moderate

“With inflation resurging, the Federal Reserve is continuing to refrain from further rate cuts, at least for now, fearing a resurgence in price hikes. Thanks to the perfect storm of dogged inflation, increasing treasury yields and the Fed’s run-off of its mortgage backed securities holdings, mortgage rates are likely to stay on pace with where they’ve been in recent months. The caveat, however, could be a strategy the Fed is implementing in June with hopes of influencing mortgage rates: reducing the amount of money in the banking system and allowing rates to naturally rise. This move could mean lower rates as we get further into June and July.”

Molly Boesel, principal economist at CoreLogic

Prediction: Rates will moderate

“Consumer inflation continues to be a driving force in interest rates. The recent Federal Reserve announcement signals that there isn’t enough confidence that inflation will continue to drop toward the 2% target. While monetary easing should come later in the year, mortgage rates most likely won’t see any meaningful drops in 2024. Look for the 30-year mortgage rate to remain in the low-7% range in June.”

Ralph DiBugnara, president at Home Qualified

Prediction: Rates will moderate

“The Fed signaled this past meeting that they will not be raising rates in the coming quarters, which I believe will be for the rest of 2024. There seemed to be more of a calmness from Fed Chair Powell in regards to current inflation and consumer spending levels. It leaves the door open for a possible rate cut later in the year and we are seeing other countries like England infer that a cut is coming. This could impact our decision making as a country. I believe we will see rates hold steady in June.”

Danielle Hale, chief economist at Realtor.com

Prediction: Rates will moderate

“The biggest tone-setter in the direction of mortgage rates in recent months has been from the inflation data. With inflation still hovering above the Fed’s 2% target, and heading the wrong direction in recent months, mortgage rates had trended higher through May when the Fed meeting and a softer inflation report brought mortgage rates a bit lower. The May inflation data out Wednesday May 15 will give the biggest insight into the likely path ahead for rates.

In the big picture, I anticipate slowing inflation and economic growth that enables mortgage rates to ease back toward the 6.5% range at the end of 2024. Whether we’ll see sufficient improvement in inflation in June to usher in that trend is still unknown. Recent upticks in consumer inflation expectations from several different consumer surveys could be a harbinger of an uptick in price growth in April. If that materializes, we could see mortgage rates reverse course and head back toward the mid-7% range. Because there is such a wide range of very plausible outcomes for mortgage rates in the months ahead, it’s important for home shoppers to rate-test their budget. Shoppers can use mortgage calculators to consider what mortgage rates as low as 6.9% or as high as 7.5% could mean for their monthly payment and home price target.”

Odeta Kushi, deputy chief economist at First American

Prediction: Rates will fall

“Recent dips in Treasury and mortgage rates, triggered by a cooling job market and the slowest pace of wage growth since 2021, hint at potential further reductions in mortgage rates if inflation continues to make progress towards the Federal Reserve’s 2% target. However, should inflation remain stickier than anticipated, it would bolster the Fed’s stance on maintaining higher rates for longer.”

Rick Sharga, CEO at CJ Patrick Company

Prediction: Rates will moderate

“There’s virtually no chance that the Federal Reserve will cut interest rates at its June meeting, and it’s highly unlikely that mortgage rates will decline meaningfully before a Fed Funds rate cut. So the most likely scenario is that while the Fed continues its “higher for longer” strategy, 30-year fixed-rate mortgages will continue to fluctuate between 7.0-7.5% in June, and for the foreseeable future beyond that.”

Mortgage interest rates forecast next 90 days

As inflation ran rampant in 2022, the Federal Reserve took action to bring it down and that led to the average 30-year fixed-rate mortgage spiking in 2023.

With inflation gradually cooling, the Fed adjusted its policies with skipped hikes and cuts are expected this year. Additionally, the economy showing signs of slowing has many experts believing mortgage interest rates will gradually descend in 2024.

Of course, rates could rise on any given week or if another global event causes widespread uncertainty in the economy.

Mortgage rate predictions for 2024

The 30-year fixed-rate mortgage averaged 7.02% as of May 16, according to Freddie Mac. All five major housing authorities we looked at project 2024’s second quarter average to finish below that.

The Mortgage Bankers Association and National Association of Realtors sit at the low end of the group, predicting the average 30-year fixed interest rate to settle at 6.68% for Q2. Meanwhile, the National Association of Realtors had the highest forecast of 7.10%.

Current mortgage interest rate trends

Mortgage rates decreased for the second consecutive week.

The average 30-year fixed rate dropped from 7.09% on May 9 to 7.02%. The average 15-year fixed mortgage rate also fell, going from 6.38% to 6.28%.

Source: Freddie Mac

After hitting record-low territory in 2020 and 2021, mortgage rates climbed to a 23-year high in 2023. Many experts and industry authorities believe they will follow a downward trajectory into 2024. Whatever happens, interest rates are still below historical averages.

Dating back to April 1971, the fixed 30-year interest rate averaged around 7.8%, according to Freddie Mac. So if you haven’t locked a rate yet, don’t lose too much sleep over it. You can still get a good deal, historically speaking — especially if you’re a borrower with strong credit.

Just make sure you shop around to find the best lender and lowest rate for your unique situation.

Mortgage rate trends by loan type

Many mortgage shoppers don’t realize there are different types of rates in today’s mortgage market. But this knowledge can help home buyers and refinancing households find the best value for their situation.

Which mortgage loan is best?

The best mortgage for you depends on your financial situation and your goals.

For instance, if you want to buy a high-priced home and you have great credit, a jumbo loan is your best bet. Jumbo mortgages allow loan amounts above conforming loan limits, which max out at $ in most parts of the U.S.

On the other hand, if you’re a veteran or service member, a VA loan is almost always the right choice. VA loans are backed by the U.S. Department of Veterans Affairs. They provide ultra-low rates and never charge private mortgage insurance (PMI). But you need an eligible service history to qualify.

Conforming loans and FHA loans (those backed by the Federal Housing Administration) are great low-down-payment options.

Conforming loans allow as little as 3% down with FICO scores starting at 620. FHA loans are even more lenient about credit; home buyers can often qualify with a score of 580 or higher, and a less-than-perfect credit history might not disqualify you.

Finally, consider a USDA loan if you want to buy or refinance real estate in a rural area. USDA loans have below-market rates — similar to VA — and reduced mortgage insurance costs. The catch? You need to live in a ‘rural’ area and have moderate or low income to be USDA-eligible.

Mortgage rate strategies for June 2024

Mortgage rates continue to display their famous volatility in 2024. Anticipated Fed cuts provide hope for optimism, but ongoing inflation battles keep driving growth.

The central bank held off on a rate hike in its past five meetings, preferring to see if the economy would keep cooling organically. At the most recent meeting in May, the FOMC projected cuts starting as early as June. As always, the committee said it would adjust its policies as necessary — which could mean additional hikes or possibly none at all.

Here are just a few strategies to keep in mind if you’re mortgage shopping in the coming months.

Be ready to move quickly

Indecision can lead to failure or missed opportunities. That holds true in home buying as well.

Although the housing market is becoming more balanced than the recent past, it still favors sellers. Prospective borrowers should take the lessons learned from the last few years and apply them now even though conditions are less extreme.

“Taking too long to decide to make an offer can lead to paying more for the home at best and at worst to losing out on it entirely. Buyers should get pre-approved (not pre-qualified) for their mortgage, so that the seller has some certainty about the deal closing. And be ready to close quickly — a long escrow period will put you at a disadvantage.

And it’s definitely not a bad idea to work with a real estate agent who has access to “coming soon” properties, which can give a buyer a little bit of a head start competing for the limited number of homes available,” said Rick Sharga.

Buyer demand is lower than a typical year, but the market usually heats up in spring and summer. Being decisive (and prepared) should only play to your advantage.

Shopping around isn’t only for the holidays

Since interest rates can vary drastically from day to day and from lender to lender, failing to shop around likely leads to money lost.

Lenders charge different rates for different levels of credit scores. And while there are ways to negotiate a lower mortgage rate, the easiest is to get multiple quotes from multiple lenders and leverage them against each other.

“For potential home buyers, it’s important to get quotes from multiple lenders for a mortgage, as rates can vary dramatically, especially during such a volatile period,” said Odeta Kushi.

As the mortgage market slows due to lessened demand, lenders will be more eager for business. While missing out on the rock-bottom rates of 2020 and 2021 may sting, there’s always a way to use the market to your advantage.

How to shop for interest rates

Rate shopping doesn’t just mean looking at the lowest rates advertised online because those aren’t available to everyone. Typically, those are offered to borrowers with great credit who can put a down payment of 20% or more.

The rate lenders actually offer depends on:

• Your credit score and credit history
• Your personal finances
• Your down payment (if buying a home)
• Your home equity (if refinancing)
• Your loan-to-value ratio (LTV)
• Your debt-to-income ratio (DTI)

To figure out what rate a lender can offer you based on those factors, you have to fill out a loan application. Lenders will check your credit and verify your income and debts, then give you a ‘real’ rate quote based on your financial situation.

You should get three to five of these quotes at a minimum, then compare them to find the best offer. Look for the lowest rate, but also pay attention to your annual percentage rate (APR), estimated closing costs, and ‘discount points’ — extra fees charged upfront to lower your rate.

This might sound like a lot of work. But you can shop for mortgage rates in under a day if you put your mind to it. And shaving just a few basis points off your rate can save you thousands.

Mortgage interest rate FAQ

What are today’s mortgage rates?

Mortgage rates are rising, but borrowers can almost always find a better deal by shopping around. Connect with a mortgage lender to find out exactly what rate you qualify for.

¹Today's mortgage rates are based on a daily survey of select lending partners of The Mortgage Reports. Interest rates shown here assume a credit score of 740. See our full loan assumptions here.

Selected sources:

• https://www.blackknightinc.com/category/press-releases
• https://www.federalreserve.gov/monetarypolicy/fomccalendars.htm
• http://www.freddiemac.com/research/datasets/refinance-stats/index.page