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Key Takeaways
- Rates for 30-year mortgages have been drifting lower and now sit near their lowest level in 14 months.
- Though the Fed is widely expected to cut its benchmark rate next week, that’s no guarantee of lower mortgage rates. Lately, the two have moved in opposite directions.
- If you’re financially ready, locking in now could be smarter than waiting. You can always refinance later if mortgage rates fall further.
Mortgage Rates Are Hovering Near Their Lowest Level in 14 Months
Rates on 30-year new-purchase mortgages have fallen in the past week to almost their lowest level since October 2024. On Black Friday this year, the 30-year average dropped to 6.36%, just a basis point above the 2025 low of 6.35% registered in late October. Though the flagship average has ticked up slightly in the past few days, it remains at 6.39%.
In early October of last year, the 30-year average was as low as 6.32%, though that was an increase from high-5% rates in mid-September. But in early 2025 and again in May, 30-year mortgage rates climbed well above the 7% mark.
Why This Matters to You
Mortgage rates have fallen to almost their lowest level in over a year, but there’s no guarantee that they’ll keep falling after the Fed’s expected rate cut next week. If you’re financially ready, locking in now can help you secure today’s savings without trying to time the market.
A Fed Rate Cut Is Widely Expected—But It May Not Push Mortgage Rates Lower
The Federal Reserve is widely expected to announce another quarter-point rate cut next Wednesday, following cuts of that size in both September and October. Many homebuyers believe that a Fed cut will lead to lower mortgage rates. But that’s not how it works.
The federal funds rate most directly affects short-term borrowing costs, like credit cards, personal loans, and bank deposit rates—not necessarily long-term loans such as mortgages.
Fixed-rate mortgages are shaped by broader forces: inflation trends, housing demand, and the overall economy. Most importantly, they tend to move with the bond market, especially the 10-year Treasury yield. In October, those yields sank to an almost 13-month low.
This complex web of factors is why mortgage rates can move independently of the Fed—and even in the opposite direction. Case in point: In late 2024, the Fed cut rates by a full percentage point between September and December. Yet 30-year mortgage rates surged almost 1.25 points higher by mid-January. More recently, the Fed’s two rate cuts this fall were both followed by a mortgage rate rise.
How To Time Your Mortgage Rate Lock—and When Waiting Can Backfire
With 30-year mortgages at almost their cheapest level in more than a year, this could be a great opportunity for homebuyers who have been waiting to lock in. A lower rate means a lower monthly payment and a welcome break after months of elevated borrowing costs.
But with the Fed widely expected to cut its benchmark rate next week, some buyers may be wondering if it’s smarter to wait and see whether mortgage rates fall even further.
The trouble is that mortgage rates are notoriously unpredictable. Even with a Fed cut, there’s no guarantee lender rates will improve. As recent swings have shown, they could instead jump higher after these lows.
That’s why it’s often better to buy when you’re financially ready and have found the right home, rather than trying to time the market. You can always refinance later if rates fall further—but you can’t rewind to grab a home that’s slipped away.
