Refi Anytime—But Miss That House, and It’s Gone

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Mortgage Rates Have Been Swinging

Shortly before the Federal Reserve’s Sept. 17 rate cut, the 30-year fixed mortgage average fell to 6.44%—its lowest level in 11 months. But instead of dropping further after the Fed’s move, mortgage rates jumped more than a quarter point. They’ve eased a bit since, though they remain higher now than they were two weeks ago.

That swing is a reminder that waiting for the “right” rate can be risky. Even a Fed cut isn’t a guarantee that mortgage rates will move lower—mortgage costs are tied more to the 10-year Treasury yield and the long-term bond market than to the Fed’s short-term rate. That means the two can even move in opposite directions.

Rates Aren’t Forever, but Homes Can Be

Mortgage rates move up and down, but the housing market doesn’t pause while buyers try to time a rate lock. Holding out hope for a lower mortgage payment could mean missing out on a great home that fits your needs and your budget—and is available now.

“You can’t buy what’s not for sale,” says Rich Martin, director of Real Estate Lending Solutions at Curinos. He points out that even when rates ease, housing affordability and a limited inventory remain the bigger hurdles.

Martin notes that when rates briefly touched 6% last year, demand surged almost immediately. “That shows how quickly competition can heat up when financing gets cheaper,” he explains. If rates slip again, millions of additional buyers could rush into the market—all competing for the same houses. 

The takeaway: Waiting for lower rates doesn’t guarantee an easier path to buying—in fact, it may only mean more competition and higher price tags.

Refinancing Later Gives You Buying Flexibility Now

The good news is, your mortgage rate doesn’t have to be yours forever. If you buy now and rates drop later, refinancing can give you another chance—or even several chances—at lowering your payment down the road.

“Interest rates can always go lower, but they can go higher too. And typically, rates go up faster than they come down,” says Chris Carter, VP and Sales Manager at Univest Home Loans.

That’s why a big danger is waiting too long. “If you have an opportunity to lock a rate that works for you, it’s best to take advantage of it when you can,” Carter says. “Holding out for something better may not pan out.”

Also, keep in mind: Refinancing isn’t always about lowering your rate. Carter explains that it can also be useful for removing mortgage insurance, switching from an adjustable-rate loan to a fixed-rate one, or shortening your term to save on interest or to better align with retirement plans.

Home Scarcity Is the Bigger Risk

Even if rates fall later, the bigger challenge may be finding a home in the first place. Lower financing costs bring more buyers off the sidelines, making competition fiercer.

“Lower rates bring more buyers into the market, which means more competition for the same limited number of homes,” Martin explains. In fact, the National Association of Realtors estimates that if mortgage rates were to drop to 6%, it could bring 6.2 million additional potential homebuyers into the market.

That rush of demand could leave you with fewer options—or none at all. This is why both experts emphasize that the smarter move is often to buy when the right home for you is available and use refinancing later to improve the rate.

How We Track the Best Mortgage Rates

The national and state averages cited above are provided as is via the Zillow Mortgage API, assuming a loan-to-value (LTV) ratio of 80% (i.e., a down payment of at least 20%) and an applicant credit score in the 680–739 range. The resulting rates represent what borrowers should expect when receiving quotes from lenders based on their qualifications, which may vary from advertised teaser rates. © Zillow, Inc., 2025. Use is subject to the Zillow Terms of Use.