Mortgage Rate Watch
Mortgage Rates Recover Some of This Week's Lost Ground Fri, 31 Oct 2025 19:43:00 GMT
After hitting the highest level in several weeks on Thursday, mortgage rates managed to move moderately lower on Friday. Counterpoint: Friday's rates are still the 2nd highest of the past 2 weeks and still meaningfully higher than last Friday's (6.28% vs 6.19% in terms of MND's rate index). The improvement makes it clear that lenders were setting rates defensively on Thursday. We know this because the level of improvement in rates is greater than that suggested by the underlying bond market. In other words, Thursday's rates had a bit of a cushion and lenders removed that cushion on Friday. Another caveat is that Friday's bond market movement argued for a mid-day adjustment toward higher rates, but it wasn't sharp enough for the average lender to go to the trouble of changing rates. In these scenarios, we can safely assume that if bonds are unchanged by Monday morning, most lenders will be offering slightly higher rates.   This is a big "if," of course. There's never any way to know exactly what bonds will do in the future, but all things being equal, there's a slight disadvantage that would need to be overcome if rates are to hold steady or improve.
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Mortgage Rates Are Anything But Lower This Week Thu, 30 Oct 2025 19:42:00 GMT
Every now and then, a Thursday comes along where we have to set the record straight on what is actually going on with mortgage rates. That's because Freddie Mac releases its weekly mortgage rate survey on Thursdays and its methodology can cause confusion in the mortgage market.  This particular Thursday is an especially treacherous minefield of misinformation due to the juxtaposition with yesterday's Fed rate cut.  There are already too many people out there repeating the faulty notion that the Fed rate cut means lower mortgage rates. Adding fuel to that fire are various headlines today (quoting Freddie's data) saying that mortgage rates have fallen to the lowest levels in more than a year. Mortgages rates certainly WERE at the lowest levels in more than year when we reported that fact on Tuesday. But what a difference 2 days make... Actual daily average rates are up 0.20% since then--the fastest 2 day rise since the exact same thing happened after last month's Fed rate cut. We'd urge those who didn't absorb the lesson back then to do so today.  Bottom line: mortgage rates had already responded to all of the news and data that resulted in the Fed rate cuts.  By the time those cuts actually happen, they have no additional power to influence rates (other than the Fed Funds Rate itself, which is not a mortgage rate except in limited cases specific to Home Equity Lines of Credit based on the Prime Rate). How does Freddie get it so wrong?  They don't.  They just get it "so late." Freddie is reporting their rate as an average of last Thursday through this past Wednesday, and 4 out of those 5 days saw exceptionally low rates. As we noted yesterday, mortgage rates were already surging higher, but not until the afternoon. This means even yesterday's rate spike was too late in the day to push Freddie's average any higher.  In other words, it was perfectly bad timing for Freddie's Thursday release to be as low as it possibly could have been.
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Yet Again, Mortgage Rates Surge Higher After Fed Rate Cut Wed, 29 Oct 2025 20:02:00 GMT
Today was not a foregone conclusion and there was no way to know ahead of time that it would end like this, but the outcome is exactly why we've gone to such lengths to warn you about the potentially paradoxical reaction to a Fed rate cut.  Too many people repeat the fallacy that mortgage rates will benefit from a Fed cut.  We have several recent examples of the exact opposite happening, and now today adds another strong reminder with the average lender moving higher at the fastest pace since the day after the last Fed meeting. Why does this happen?  It has nothing to do with the rate cut itself.  As we warned, volatility would come from Fed Chair Powell's press conference. In today's case, Powell said that another rate cut in December was not a foregone conclusion.  This was at odds with the market's expectations, so there was a rush to reprice those expectations.   As always, today's rates instantly adjust to expectations for rates in the future (the main reason that Fed rate cuts do little-to-nothing to impact market rates).   In relative terms, rates are still lower than most of the past year, but back up to similar levels seen on October 14/15th. 
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Lowest Rates in a Year. Tomorrow's Fed Announcement Could Push Them in EITHER Direction Tue, 28 Oct 2025 20:11:00 GMT
Rates have been flirting with long term lows over the past 2 weeks, but today made it official.  Today's average top tier 30yr fixed rate perfectly matched that seen on September 16th, 2025.  That's the lowest it's been since September 2024, and we're so close to those lows that it's just as fair to say rates are the lowest they've been in over 3 years.  Today's move didn't come in response to anything specific. In fact, most of the justification for it was seen in yesterday's trading session and simply didn't have an opportunity to impact the average lender until this morning.  Incidentally, there are similar vibes this afternoon as bonds have once again improved too late in the day for most lenders to go to the trouble of adjusting mortgage rates. That means that if bonds (upon which rates are based) manage to hold their current levels through tomorrow morning, rates could be a bit lower again tomorrow.  Of course, after that, there's a fair amount of potential volatility associated with the Fed announcement at 2pm ET.  We already know the Fed will be cutting rates tomorrow and that rate cut has no bearing on what happens to mortgage rates going forward. Rather, it would be the tone of the Fed's press conference, or the nature of any changes in the Fed's bond buying policies (something that might be included in tomorrow's statement). Bottom line: rates are already low today. The Fed rate cut won't make them go any lower.  Other info from the Fed could make them go EITHER higher or lower, depending on what's said.  
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Mortgage Rates Perfectly Flat to Start The Week Mon, 27 Oct 2025 19:15:00 GMT
Mortgage rates fell to the lowest levels in a month last Tuesday and barely budged through the rest of the week. Now, at the start of the new week, the average lender is perfectly unchanged from last Friday. This means there are only a small handful of days with meaningfully lower rates going all the way back to late 2022. As the government shutdown continues, the bond market (which dictates rates) continues missing out on the bulk of relevant economic reports that normally help guide momentum throughout the month.  Depending on the day, however, there can be other sources of inspiration. In today's case, the bond market took some solace from a well-received auction of US Treasuries. When it comes to auctions, when demand is stronger than expected, it can put some downward pressure on rates. This happened today, and it prompted a small handful of lenders to issue mid-day improvements, but it wasn't enough to change the average rate.
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Mortgage Rates Little-Changed Despite Decent Inflation Data Fri, 24 Oct 2025 18:45:00 GMT
This morning brought the release of the much-anticipated Consumer Price Index (CPI). This is one of the two biggest inflation reports from the U.S. government, and the only government inflation report that's coming out during the shutdown.  With big government data being a key consideration for interest rates, this special release got extra attention. Core monthly inflation was lower than expected (.227% vs 0.3 forecast) as was the annual level at 3.0% versus a median forecast of 3.1%. Inflation is the nemesis of interest rates, so the lower-than-expected result is rate-friendly at face value. The underlying bond market agreed to some extent.  The first reaction was stronger, thus implying lower mortgage rates. But mortgage lenders don't tend to publish rates for the day until around 10am ET, 90 minutes after CPI came out.  In that time, bonds had second thoughts about how strong their reaction would be--possibly due to internal components of the data that suggested non-tariff-related inflation remains elevated outside after removing the impact from housing payments. Bonds remained in just barely stronger territory, but didn't quite make it back to yesterday morning's levels. As such, most mortgage lenders were just a hair higher in rate compared to yesterday--a completely logical outcome based on how bonds were trading. The best way to view today's rate move (or lack thereof) in the context of the inflation data is to say that rates would have been more noticeably higher in the absence of CPI.
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Mortgage Rates Seeing Some Underlying Pressure Ahead of Inflation Data Thu, 23 Oct 2025 19:22:00 GMT
Mortgage rates were effectively unchanged on Thursday with the average lender very close to the best levels in over a year. But when it comes to the underlying bond market and the rates available to consumers, there are some dislocations that suggest risk is increasing. Specifically, bonds lost ground today. This normally implies higher mortgage rates. But the timing and magnitude of bond market losses can dictate the size of mortgage rate changes as well as the timing. In today's case, bonds were in better shape this morning when mortgage lenders published their daily rate offerings.  There was additional bond market weakness as the day progressed, but not enough to trigger a mid-day rate change from lenders (mortgage lenders prefer to avoid mid-day changes unless bonds make bigger moves). Bottom line: instead of going into tomorrow with a cushion from the bond market, mortgage lenders will have to raise rates a bit in order to catch up.  NOTE: this assumes that bonds hold their exact same levels through tomorrow morning.  That's certainly NOT a guarantee considering we'll get the release of September's CPI inflation data at 8:30am ET.  There's no way to know how CPI will come in. Markets have already positioned for everything they think they know about the data.  In other words, there is a consensus expectation that monthly core CPI will be 0.3% and non-core (headline) CPI will be 0.4%. If the actual numbers are higher, rates would be more likely to rise tomorrow, but if they're lower, bonds could bounce back enough that mortgage rates continue to hold steady, or actually improve. 
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Mortgage Rates Steady At Long Term Lows Wed, 22 Oct 2025 19:14:00 GMT
Mortgage rates were perfectly unchanged today, on average.  With that, they remain in line with the lowest levels in more than a year and very close to the lowest levels in more than 3 years.  Recent momentum has been moderate and favorable. In the absence of big economic reports that are on hold due to the shutdown, bonds have taken cues from other developments like the new tariffs announced 2 weeks ago and the regional bank drama seen last week.  These market movers would normally be operating in the background--perhaps not even meriting discussion--but the dearth of data and the generally narrow range makes their effects more noticeable.  In thinking about the relatively uneventful return to long-term lows, it's good to remember that momentum comes and goes when it comes to rates and the bond market that drives them.  Sometimes, a string of good luck is the only required catalyst for a token pull-back.  Bonds are showing some fatigue as 10yr yields have pushed just under 4.0%. It may take some more convincing in the form of data or other events to motivate additional improvement. 
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Another Winning Day For Mortgage Rates Tue, 21 Oct 2025 20:29:00 GMT
The bonds that underly mortgage rates were only slightly stronger today, but that's never a bad thing when they closed near the best levels in a year the previous day. Additionally, those bonds improved by the end of the day yesterday, meaning that mortgage lenders were going into today with a bit of a cushion. When lenders set rates, they are basically looking at a constantly-moving bond market and locking in rates that will be in effect for the rest of the day.  Mid-day changes only happen if bonds make a big enough move and yesterday's wasn't big enough for most lenders. Yesterday's cushion combined with today's modest additional improvement for fairly decent drop in the average top tier 30yr fixed rate.  We're also now in the zone of rates where movement happens more quickly due to the underlying architecture of the mortgage bond market.  In not so many words, this causes rates to accelerate toward levels that end in 0.125 or .625 for reasons that are too esoteric to dig into today (if you want to nerd out, here you go: Why Mortgage Rates Move in Jumps Instead of Straight Lines). Some lenders are offering their lowest rates in over a year, and some in over 3 years.  The average lender is right in line with 1-year lows and close enough to 3-year lows.
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Another Boring Day With Mortgage Rates Near 3-Year Lows Mon, 20 Oct 2025 19:23:00 GMT
Mortgage rates ended last week at the lowest levels in just over a month. It was the 3rd best day in over a year and the 24th best day in over 3 years. The other 23 days weren't too much lower either. The only difference today is a microscopic improvement that makes it the 2nd best day in over a year. In other words, we're hanging out near 3 year lows with minimal volatility. In order to see sharper, more sustained momentum, we'd likely need the government shutdown to end. That would allow the most consequential economic reports (like the jobs report) to be released. It would also allow data collection to resume for future jobs reports. Between now and then, there is other data to guide the rate market, but it's just not as heavy hitting. This week is particularly light in that regard, but there's one exception. The BLS received an exception to compile September's CPI inflation data, to be released this Friday. It's not quite on par with the jobs report, but it can certainly get rates moving (for better or worse, depending on the details).
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