Mortgage Rates Today, Monday, October 5: A Little Lower

Mortgage rates are a little lower this morning, possibly in response to Friday’s weaker-than-expected jobs report. Coupled with last Wednesday’s maybe-things-aren’t-too-bad inflation data, it’s looking like the Federal Reserve will hold off on a rate hike at its meeting later this month.

The average interest rate on a 30-year, fixed-rate mortgage dropped to 7.31% APR, according to rates provided to NerdWallet by Zillow. This is 10 basis points lower than Friday but six basis points higher than a week ago. (See our chart below for more specifics.) A basis point is one one-hundredth of a percentage point.

So yes, mortgage rates are lower today, but it’s a relative low — rates have moved significantly higher in recent weeks. For more on what’s driving up mortgage rates and how Fed policy fits into the equation, keep reading below the chart.

The Fed has two more meetings in 2026, and based on the bankers’ anonymous predictions last month, at least one additional rate hike is on the table. The timing is still in question. A week ago, the odds of a hike at the Fed’s October meeting were about 70%. Today, they’re roughly 21%.

There’s the rub. Lower interest rates can stimulate employment, but they also encourage borrowing and spending. That risks increasing the rate of inflation. At the opposite end, raising rates can tamp down on inflation, but could also dampen the labor market. The central bankers have to balance their efforts to cool price growth with keeping the labor market healthy.

For now, it’s looking like the Fed will hold steady at this month’s meeting. That removes a bit of upward pressure on mortgage rates, but don’t expect a dramatic drop: The larger forces pushing up long-term borrowing costs aren’t likely to ease soon.

Refinancing might make sense if today’s rates are at least 0.5 to 0.75 of a percentage point lower than your current rate (and if you plan to stay in your home long enough to break even on closing costs).

With rates where they are right now, you could start considering a refi if your current rate is around 7.81% or higher.

There is no universal “right” time to start shopping — what matters is whether you can comfortably afford a mortgage now at today’s rates.

Rate locks protect you from increases while your loan is processed, and with the market forever bouncing around, that peace of mind can be worth it.

In addition to market factors outside of your control, your customized quote depends on your:

Even two people with similar credit scores might get different rates, depending on their overall financial profiles.

Maybe — but even personalized rate quotes can change until you lock. That’s because lenders adjust pricing multiple times a day in response to market changes.

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