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re you thinking about buying a home, refinancing your mortgage, or keeping an eye on the market? If so, you're likely wondering what will happen with mortgage rates in the next couple of months. Good news: all indications suggest that mortgage rates are expected to modestly decline between September and October 2025.
Currently, 30-year fixed mortgage rates are around 6.56% as of late August 2025. Anticipate a slight easing due to anticipated Federal Reserve rate cuts. Let's break down the factors shaping this forecast and what it means for you.
The current mortgage rate landscape has 30-year fixed rates at 6.56%, with jumbo loans at around 6.80% and FHA rates at approximately 6.28%. This means you'll pay $6.56 in interest for every $100 borrowed over 30 years, with payments spread out.
In the coming months, a few key factors will influence mortgage rates:
Federal Reserve rate cuts: The Fed's meetings on September 16-17 and October 28-29 may lead to rate cuts, potentially dropping mortgage rates by 0.1% to 0.2%.
Inflation: Although cooling down, inflation remains a major factor, with the Consumer Price Index (CPI) at 2.8% annually in July 2025.
Unemployment: The stable unemployment rate of 4.2% (as of July 2025) may lead to calm Fed decisions.
Global events and the 10-Year Treasury Yield will also play a role.
Experts' forecasts vary, but most predict rates will decline:
Mortgage Bankers Association (MBA): 6.8% for July to September 2025, and 6.7% for October to December.
Fannie Mae: Rates ending the year close to 6.4%.
National Association of Realtors (NAR): Rates around 6.7% for the second part of 2025.
Given this information, our prediction is a slight decline in September and October 2025, with rates landing around 6.4% in September and 6.3% in October.
This forecast assumes the Fed cuts rates by 0.25% and no big shockers happen in the stock markets.
The impacts on homebuyers, sellers, and investors will be:
Homebuyers: Rates between 6.3 – 6.4% could make monthly payments less, improving affordability.
Sellers: If rates drop, some people might list their homes.
Investors: Cheaper financing can improve returns for rental properties.
Advice for navigating September and October 2025:
Buyers: Lock in a rate early! Consider adjustable-rate mortgages (ARMs) for short-term savings.
Refinancers: Pay attention to news from the Fed. If they cut rates, take action!
Investors: Keep an eye out for areas with strong demand.
A look at historical data shows recent trends in 30-year fixed rates:
Month/Year
Average Rate (%)
Jan 2024
6.64
Feb 2024
6.78
Mar 2024
6.87
Apr 2024
7.10
May 2024
7.02
Jun 2024
6.95
Jul 2024
6.84
Aug 2024
6.84
Sep 2024
6.81
Oct 2024
7.03
Nov 2024
6.90
Dec 2024
6.85
Jan 2025
6.91
Feb 2025
6.82
Mar 2025
6.75
Apr 2025
6.70
May 2025
6.68
Jun 2025
6.65
Jul 2025
6.63
Aug 2025
6.57
To wrap it up, while no one can say for sure what will happen, things are pointing to at least a slight easing in mortgage rates over the next couple of months. The Fed's decisions, inflation levels, and overall employment rates will be the biggest indicators. It's time to stay alert and make smart choices!
