Average long-term US mortgage rate ticks up for second straight week, to
6.34%
[October 03, 2025] By
MATT OTT
WASHINGTON (AP) — The average rate on a 30-year U.S. mortgage ticked up
for the second straight week following a string of declines that had
brought down home borrowing costs to their lowest level in nearly a
year.
The average long-term mortgage rate rose this week to 6.34% from 6.3%
last week, mortgage buyer Freddie Mac said Thursday. A year ago, the
rate averaged 6.12%.
Mortgage rates are influenced by several factors, from the Federal
Reserve’s interest rate policy decisions to bond market investors’
expectations for the economy and inflation. They generally follow the
trajectory of the 10-year Treasury yield, which lenders use as a guide
to pricing home loans.
The 10-year yield was at 4.10% at midday Thursday, down from 4.19% the
same time last week. Much of that decline has come in the past few days,
driven by discouraging reports on the U.S. economy, particularly the job
market.
In late July, mortgage rates started declining in the lead-up to the
Federal Reserve’s widely anticipated decision last month to cut its main
interest rate for the first time in a year amid growing concern over the
U.S. job market.
However, Fed Chair Jerome Powell has since signaled a cautious approach
to future interest rate cuts. That’s in sharp contrast with other
members of the Fed’s rate-setting committee, particularly those who were
appointed by President Donald Trump, who are pushing for faster cuts.
The housing market has been in a slump since 2022, when mortgage rates
began climbing from historic lows. Sales of previously occupied U.S.
homes sank last year to their lowest level in nearly 30 years. So far
this year, sales are running below where they were at this time in 2024.
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 The second straight bump in rates
could signal a repeat of what happened last year after the Fed cut
its benchmark rate for the first time in more than four years. Back
then, mortgage rates fell for several weeks prior to the Fed’s
September rate cut. In the following weeks however, mortgage rates
began rising again, eventually reaching just above 7% in mid-January
this year.
Like last year, the Fed’s rate cut doesn’t necessarily mean mortgage
rates will keep declining, even as the central bank signals more
cuts ahead.
Still, the late-summer decline in mortgage rates has already
encouraged many homeowners who bought in recent years after rates
climbed well above 6% to refinance to a lower rate.
Mortgage rates will have to sink below 6% to make refinancing an
attractive option to a broader swath of homeowners, however. That’s
because about 81% of U.S. homes have a mortgage with a rate of 6% or
lower, according to Realtor.com.
Economists generally forecast the average rate on a 30-year mortgage
to remain near the mid-6% range this year.
Borrowing costs on 15-year fixed-rate mortgages, popular with
homeowners refinancing their home loans, also inched up this week.
The average rate rose to 5.55% from 5.49% the previous week. A year
ago, it was 5.25%, Freddie Mac said.
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