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s of August 24, 2025, mortgage rates have dropped across the board compared to last week. The national average 30-year fixed mortgage rate fell slightly to 6.61% from 6.67%, according to Zillow. Refinancing rates also saw a noticeable decline, with the 30-year fixed refinance rate falling to 6.78% from 6.91%. These decreases come amid economic data showing weak job growth and sticky inflation, leading markets to expect a Federal Reserve interest rate cut in September.

    Key Takeaways:

    - 30-Year Fixed Mortgage Rate: Dropped to 6.61% from 6.67%.

    - Refinance Rates: 30-year fixed refinance rates fell to 6.78%, down 13 basis points from last week.

    - Market Outlook: 91% chance of Fed cutting interest rates by 25 basis points in September 2025.

    Experts generally expect mortgage rates to stay above 6% through the next several quarters, but a downward trend is expected due to economic indicators suggesting slower job growth and persistent inflation. The current environment increases market confidence that the Federal Reserve will cut benchmark interest rates soon.

    Here's a detailed look at the rates as of August 24, 2025:

    - Loan Type: Rate (%): Weekly Change: APR (%): Weekly APR Change

    - 30-Year Fixed: 6.61: Down 0.06%: 7.04: Down 0.08%

    - 20-Year Fixed: 6.43: Down 0.24%: 6.94: Down 0.04%

    - 15-Year Fixed: 5.72: Down 0.05%: 6.01: Down 0.06%

    - 10-Year Fixed: 5.79: Up 0.31%: 6.09: Up 0.25%

    Refinance rates have also experienced a decline this week, offering potential savings to homeowners seeking to lower monthly payments or reduce their mortgage terms.

    The recent easing in mortgage rates is tightly linked to broader economic signals and Federal Reserve policies:

    - Weak Job Growth: The July jobs report highlighted slower-than-expected employment gains.

    - Inflation Trends: Inflation remains sticky but is slightly below expectations.

    - Fed Rate Cut Probability: Market tools like CME FedWatch show a 91% chance of a 25 basis point rate cut at the Fed's September 16-17 meeting.

    The current environment of slowly declining mortgage and refinance rates might not mean a dramatic drop but signals growing affordability on the horizon. Experts predict a gradual decline in mortgage rates for the remainder of 2025 and into 2026, albeit rates will likely remain above 6%. Sudden large drops are unlikely due to ongoing inflation concerns and economic uncertainty.

    Forecasts from leading organizations include:

    - National Association of REALTORS: expects mortgage rates averaging 6.4% in the latter half of 2025, dipping to 6.1% in 2026.

    - Fannie Mae's August 2025 Forecast projects rates ending 2025 and 2026 at approximately 6.5% and 6.1%, respectively.

    - Mortgage Bankers Association predicts rates will hover near 6.8% through September, easing slightly to mid-6% range by year-end 2025.

    The Federal Reserve remains the key player influencing mortgage rates by setting short-term interest rates and guiding market expectations. The recent switch towards rate cuts is fueling investor optimism.