Mortgage Rates Hit 11-Month Low as Fed Cuts Rates

At Rezny Wealth Management, we’re keeping a close eye on mortgage rates—and they dropped again last week. According to Freddie Mac’s Primary Mortgage Market Survey, the average 30-year fixed mortgage rate fell to 6.26%, down from 6.35% the week before. A year ago, the same loan averaged 6.09%.

Freddie Mac’s chief economist, Sam Khater, noted that lower rates are encouraging many homeowners to refinance. In fact, nearly 60% of mortgage applications last week were for refinancing—the highest level since early 2022. The 15-year fixed mortgage rate also fell, dropping from 5.5% to 5.41%. One year ago, that rate averaged 5.15%.

These rate moves came right after the Federal Reserve cut its benchmark interest rate by 0.25%, bringing the federal funds rate to a new range of 4% to 4.25%. This was the first cut since December 2024, after the Fed held rates steady for five straight meetings. Current projections show two more rate cuts later this year, which could lower the federal funds rate to about 3.6% by year’s end.

At Rezny Wealth Management, we expected to see rates move lower in the second half of the year, and we continue to anticipate further declines as the Fed adjusts policy. Looking further out, markets expect the federal funds rate to fall to around 3.0% by mid-2026, though the Fed’s outlook suggests it may stay just above 3% through 2028. For now, borrowers are benefiting as the 30-year mortgage rate hits an 11-month low.