S
eptember 21, 2025 – Mortgage rates climbed across all major loan types. The national average for a 30‑year fixed mortgage rose to 6.60 %, up 0.08 % from the previous day and 0.15 % from the week before, while the 15‑year fixed rate moved to 5.86 %. Adjustable‑rate mortgages (ARMs) also edged higher; the 5‑year ARM is now 7.19 %. Refinance rates eased slightly, with the 30‑year fixed refinance at 7.00 %, but remain well above recent lows.
**Why rates moved despite the Fed cut**
* The Federal Reserve lowered its benchmark rate by 25 bps on September 17, 2025, to 4.00‑4.25 %.
* Mortgage rates track the 10‑year Treasury yield and inflation expectations, not the Fed’s short‑term rate.
* After the cut, long‑term Treasury yields rose as investors priced in higher future inflation and a slower economic outlook.
* Market expectations of a more aggressive Fed move than actually occurred pushed rates higher.
* Recent inflation data exceeded forecasts, reinforcing upward pressure.
**Current national averages**
| Loan type | Current rate | Change from last week |
|-----------|--------------|-----------------------|
| 30‑year fixed | 6.60 % | +0.15 % |
| 20‑year fixed | 6.00 % | –0.21 % |
| 15‑year fixed | 5.86 % | +0.35 % |
| 10‑year fixed | 5.84 % | +0.06 % |
| 7‑year ARM | 6.94 % | +0.56 % |
| 5‑year ARM | 7.19 % | +0.19 % |
**Government‑backed loans**
| Loan type | Current rate | Change |
|-----------|--------------|--------|
| 30‑year FHA | 7.50 % | +1.84 % |
| 30‑year VA | 6.13 % | +0.22 % |
| 15‑year FHA | 5.49 % | +0.26 % |
| 15‑year VA | 5.82 % | +0.25 % |
**Refinance rates**
| Loan type | Current rate | Change |
|-----------|--------------|--------|
| 30‑year fixed refinance | 7.00 % | –0.01 % |
| 15‑year fixed refinance | 5.88 % | +0.03 % |
| 5‑year ARM refinance | 7.29 % | no change |
**Impact on borrowers**
A $300,000 loan at 6.60 % over 30 years yields a monthly payment of about $1,916, versus $1,895 at 6.45 %. The increase adds roughly $21 per month, or $7,560 over the life of the loan.
**Forecasts**
* NAR: 6.4 % average in H2 2025, dropping to ~6.1 % by 2026.
* Fannie Mae: 6.5 % end‑2025, 6.1 % 2026.
* Mortgage Bankers Association: 6.7 % by end‑2025, 6.5 % 2026.
* Realtor.com: gradual easing to ~6.4 % by year‑end.
**Fed’s role**
The Fed’s recent cut was aimed at cushioning a slowing labor market. While short‑term rates fell, mortgage rates remain tied to long‑term Treasury yields and inflation expectations. Fixed‑rate borrowers see no immediate change unless they refinance; ARM holders may benefit from reset rates that follow Fed policy.
**Takeaway**
Mortgage rates are driven more by long‑term Treasury yields and inflation sentiment than by the Fed’s benchmark. The recent rise reflects persistent inflation concerns and market expectations. Homebuyers and refinancers face higher costs, but strategic real‑estate investments—such as turnkey rental properties in resilient markets—can still offer stable cash flow and hedge against borrowing volatility.
For guidance on navigating these rates, contact a Norada investment counselor at (800) 611‑3060.
