Mortgage rates are down today as Treasury yields eased ahead of Friday’s inflation report — but don’t expect that to indicate a larger downward trend.
The average interest rate on a 30-year, fixed-rate mortgage dropped to 6.65% APR this morning, according to rates provided to NerdWallet by Zillow. This is 17 basis points lower than yesterday and 13 basis points lower than a week ago. (See our chart below for more specifics.) A basis point is one one-hundredth of a percentage point.
That sounds like a big drop, but honestly, lenders’ rates are kind of all over the place today. (Yes, I am a real human who looks at these things over my morning coffee. ☕) And considering the messy mix of economic signals right now, that tracks. Every lender is going to set their prices differently, considering these uncertainties:
Markets are split over whether the Federal Reserve will raise its benchmark rate next week, though a slightly larger majority expects that they will.
Oil prices nearly hit $100 a barrel this morning as conflict drags on in the Strait of Hormuz.
Your takeaway: When economic news is pinging nonstop and lenders are reacting differently, don’t treat the first mortgage rate you see as your only option. Rates vary widely by lender, so shopping around could save you thousands over the life of your loan.
Average mortgage rates, last 30 days
🤓 Kate on Rates: September 3, 2026
📈 What influences mortgage rates?
Mortgage rates are constantly changing, since a major part of how rates are set depends on reactions to new inflation reports, job numbers, Fed meetings, global news … you name it. For example, even tiny changes in the bond market can shift mortgage pricing.
There’s been a lot pushing mortgage rates higher recently. Let’s do a quick recap of three of the biggest influences, which all kinda boil down to one thing: Inflation.
One, we’ve got the war in Iran. After a weekslong stretch of relative peace, tensions have flared into actual aggression once again — and pretty much every time that’s happened, we’ve seen mortgage rates rise. Mortgage rates are pegged to the yield (essentially the return) on the 10-Year Treasury note. Concerns about the Iran war impeding trade, pushing up oil prices and overall, spurring inflation, keep driving bond yields higher. As yields go up, so do rates.
Two, Fed chatter. Chair Kevin Warsh has made abundantly clear that he would like Fed officials to communicate less, and he’s already made significant changes to the central bankers’ post-meeting statements. But that doesn’t mean he can stop anyone from talking, or stop markets from parsing the bankers’ every word.
Back on Aug. 28, which sounds like forever ago but really wasn’t, Warsh made his first official speech as chair. As always, he kept his remarks pretty high level. But he sounded just aggressive enough on inflation for Fed watchers to decide a quarter-percentage-point rate hike is likely at the Sept. 15-16 meeting (BTW that’s next week). The Federal Reserve doesn’t set mortgage rates, but its decisions are highly influential — and rates spiked upward following Warsh’s remarks.
But markets are fickle. Last week, a couple of Federal Reserve officials made public remarks that a rate hike may not be needed. That was enough to bring down those odds, and shave a few basis points off of Friday’s average mortgage rates.
Speaking of Friday: Last week closed with the case for maintaining the funds rate getting a little weaker, as August’s Employment Situation Summary (better known as the jobs report) showed a shockingly strong labor market. In August, the U.S. economy added 162,000 jobs, more than three times what economists had predicted. The unemployment rate continued to hold steady.
This was especially stunning coming off of July, which originally showed the economy losing 23,000 jobs. That stat’s been revised upward, and while it’s still way lower than August — 21,000 jobs gained — at least now it’s a positive number.
If the labor market were struggling, that would discourage the Fed from hiking rates. The central bankers raise the federal funds rate (that’s the overnight borrowing rate the Fed sets) to curb inflation. Part of that reasoning is that higher rates discourage businesses from expansion and hiring. If the labor market’s in bad shape, it’s risky to raise rates even if inflation’s high. But if it seems like the job market’s strong, the Fed can feel more confident about choosing to tackle inflation.
And back to inflation, because but certainly not least on the list of what’s driving mortgage rates, we’ve got actual inflation stats. If you’ve bought gas, groceries, or really anything you had a sense of the price history on lately, you’ve been feeling the pinch of rising prices. The Federal Reserve targets a 2% rate of inflation as healthy for the economy, but we’ve been above that since March 2021.
We’ll get brand new inflation data to close out this week, with August’s Consumer Price Index set for release on Friday, Sept. 11. If CPI comes in at or above expectations, that could tilt the odds back toward a rate hike from the Fed at its meeting next week.
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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 7.15% or higher.
Also consider your goals: Are you trying to lower your monthly payment, shorten your loan term or turn home equity into cash? For example, you might be more comfortable with paying a higher rate for a cash-out refinancethan you would for a rate-and-term refinance, so long as the overall costs are lower than if you kept your original mortgage and added a HELOC or home equity loan.
If you’re looking for a lower rate, use NerdWallet’s refinance calculator to estimate savings and understand how long it would take to break even on the costs of refinancing.
🏡 Should I start shopping for a home?
There is no universal “right” time to start shopping — what matters is whether you can comfortably afford a mortgage now at today’s rates.
If the answer is yes, don’t get too hung up on whether you could be missing out on lower rates later; you can refinance down the road. Focus on getting preapproved, comparing lender offers, and understanding what monthly payment works for your budget.
NerdWallet’s affordability calculator can help you estimate your potential monthly payment. If a new home isn’t in the cards right now, there are still things you can do to strengthen your buyer profile. Take this time to pay down existing debts and build your down payment savings. Not only will this free up more cash flow for a future mortgage payment, it can also get you a better interest rate when you’re ready to buy.
🔒 Should I lock my rate?
If you already have a quote you’re happy with, you should consider locking your mortgage rate, especially if your lender offers a float-down option. A float-down lets you take advantage of a better rate if the market drops during your lock period.
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.
🤓 Nerdy Reminder: Rates can change daily, and even hourly. If you’re happy with the deal you have, it’s okay to commit.
🧐 Why is the rate I saw online different from the quote I got?
The rate you see advertised is a sample rate — usually for a borrower with perfect credit, making a big down payment, and paying for mortgage points. That won’t match every buyer’s circumstances.
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.
👀 If I apply now, can I get the rate I saw today?
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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