You’ve probably seen the headlines. Or maybe you just checked your banking app and did a double-take. Honestly, the housing market has felt like a fever dream for the last few years, but as of January 15, 2026, things are finally starting to look... well, different.
The big number today? 6.06%.
That is the current national average for a 30-year fixed-rate mortgage, according to Freddie Mac. If you’ve been sitting on the sidelines since 2023, waiting for the sky-high 7% or 8% rates to vanish, this feels like a win. It’s actually the lowest we’ve seen in years. Some lenders are even dipping their toes into the high 5s, especially after the White House recently directed Fannie Mae and Freddie Mac to buy up $200 billion in mortgage-backed securities.
That move essentially forced some oxygen into a room that was running out of it.
Why the 6% mark is such a big deal
It’s mostly psychological. For a long time, 7% felt like a wall. People looked at that number and just stopped looking at houses. But 6%? That’s where the math starts to work again for a lot of families.
Take a typical $400,000 loan. At a 7% rate, your principal and interest payment is about $2,661. At 6%, it drops to roughly $2,398. Saving $263 a month isn't just "nice"—it's the difference between a grocery budget and a "maybe we can't afford this house" conversation.
But don't get it twisted. We aren't going back to the 3% days. Those were an anomaly, a fluke of history caused by a global pandemic. If you're waiting for 3% to come back before you buy, you might be waiting until your grandkids are in college.
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What are mortgage interest rates now across different loans?
Rates aren't one-size-fits-all. They're more like a fingerprint—they depend on your credit score, your down payment, and even which state you’re living in.
- 30-Year Fixed: The gold standard is sitting at 6.06%.
- 15-Year Fixed: If you want to pay off the house fast and can handle a monster monthly payment, these are averaging around 5.38%.
- FHA Loans: These are often slightly lower, currently around 6.09% with an APR of 6.15%, which is great for first-time buyers who don't have a massive 20% down payment.
- Jumbo Loans: If you're buying a mansion (or just a regular house in California), you're looking at about 6.37%.
The gap between these is narrowing, but it’s still there.
The Federal Reserve and the "Trump Effect"
There's a lot of drama behind these numbers. The Federal Reserve spent most of 2025 cutting rates—three times, to be exact. They brought the federal funds rate down to a range of 3.5% to 3.75% by December.
Usually, when the Fed cuts, mortgage rates follow. But they didn't follow as fast as people wanted. There’s this thing called the "spread"—the gap between the 10-year Treasury yield and mortgage rates. In a normal world, that gap is small. Lately, it’s been huge because investors were scared of inflation and government debt.
Then came the January 2026 announcement. President Trump’s social media post about directing the government to buy $200 billion in mortgage bonds acted like a shock to the system. It sent yields tumbling and dragged mortgage rates down with them. It’s a controversial move, and some economists are worried it’s a short-term sugar high that could lead to higher inflation later, but for a buyer today? It’s a discount.
Is the "Lock-In Effect" finally breaking?
For the last three years, the housing market was basically frozen. Nobody wanted to sell their house because they had a 3% mortgage and didn't want to trade it for a 7% one. This was the "lock-in effect."
Well, the ice is cracking.
Recent data from Realtor.com shows an "inflection point." For the first time since the pandemic, the share of people with mortgages above 6% has actually surpassed the share of people with rates below 3%.
What does that mean for you? It means more people are moving. They’re realizing that life doesn't wait for interest rates. People get married, they have kids, they get new jobs in different cities. The market is slowly becoming "normal" again. Inventory is up about 20% compared to last year, so you actually have choices now. You don't have to get into a fistfight at an open house just to put in an offer.
What experts are saying for the rest of 2026
Forecasting interest rates is a bit like forecasting the weather in April—you know it'll be warmer, but you might still get a random snowstorm.
Goldman Sachs expects the Fed to pause its rate cuts in January (which they did) and then cut again in March and June. They think the "terminal rate"—the final landing spot—will be around 3.25%.
If that happens, mortgage rates could settle into the mid-to-high 5% range by the summer. Morgan Stanley is even more optimistic, predicting we might see 5.5% to 5.75% in the first half of the year.
However, there’s a catch. The Congressional Budget Office (CBO) is a bit more cynical. They think the 10-year Treasury yield will actually rise toward the end of the year because of government deficits. If the Treasury yield goes up, mortgage rates go up. It’s a tug-of-war.
Strategies for the 2026 market
If you're looking at these rates and wondering if you should jump in or wait another six months, here’s the reality: you can’t time the market perfectly.
Some people are choosing to "buy the house, not the rate." They get the home they want now and plan to refinance if rates hit 5% next year. It's a gamble, but with home prices starting to rise again (about 2% to 3% growth expected this year), waiting six months might save you 0.5% on interest but cost you $15,000 more on the purchase price.
Watch your DTI. Debt-to-income ratio is the first thing lenders look at. If you’ve got a car payment or a stack of credit card debt, that’s going to hurt your rate more than the Fed’s decisions will.
Shop at least three lenders. I know it’s a hassle. But the "variability" in the market right now is about a 4 out of 10. That means one bank might offer you 6.2% while another is willing to go 5.9% just to get your business. On a 30-year loan, that 0.3% difference is thousands of dollars.
Consider the "buy-down." If you find a seller who is desperate to move, ask them for a "seller concession" to buy down your interest rate. They pay a fee at closing, and your rate drops by 1% for the first year or two. It’s a common move in 2026 to make the monthly payment more bearable.
Actionable Next Steps
Check your FICO score immediately; in 2026, borrowers with a score of 740 or higher are seeing the most aggressive rate discounts from lenders. If you're within 20 points of that threshold, spend the next 30 days paying down revolving credit card balances to give your score a quick "pop" before applying. Once your score is ready, get a Pre-Approval—not just a pre-qualification—which carries more weight with sellers who are finally seeing a bit of competition return to the spring market. Finally, look into Mortgage Credit Certificates (MCCs) if you're a first-time buyer; these tax credits can effectively lower your "real" interest rate by allowing you to claim a portion of your mortgage interest as a dollar-for-dollar credit against your federal income tax.