UPDATE: Mortgage rates have plunged to their lowest level since 2022, sparking a surge in home purchases and refinancing! As of January 15, 2026, the average 30-year fixed-rate mortgage has fallen to 6.06%, marking a significant drop from 7.04% a year ago, according to data from Freddie Mac.
This decline comes at a critical juncture for the U.S. real estate market, which had recently shown signs of stagnation. Now, buyers and homeowners alike are seizing the moment, eyeing more favorable financing options after enduring months of high borrowing costs.
The 15-year fixed-rate mortgage also saw a decrease, resting at 5.38%, its lowest since October 2024. The immediate impact is palpable, as consumers react swiftly to these lower rates, breathing new life into the market.
In a surprising twist, President Donald Trump announced on social media that he plans to direct Fannie Mae and Freddie Mac to purchase $200 billion in mortgage-backed securities. This is aimed at further lowering rates for consumers, and it caused the 30-year fixed rate to briefly dip below 6% before slightly rebounding.
The effects of this announcement are already being felt. The Mortgage Bankers Association (MBA) reported a staggering 28.5% increase in total mortgage application volume week over week. Notably, refinancing applications surged nearly 40%, as homeowners rushed to take advantage of the new lower rates.
During the same week, the average contractual 30-year mortgage rate decreased from 6.25% to 6.18% for conforming loans up to $832,750 with a 20% down payment. Points have also slightly declined, which means lower costs for borrowers.
Joel Kan, chief economist at the MBA, emphasized that this shift is not merely seasonal. “This was a real move driven by the decline in rates,” Kan stated. He highlighted that the widening spreads were evident even before the presidential announcement, and this period typically experiences heightened activity post-holidays.
For potential borrowers, this is a crucial time. Consumers can benefit from loans that may cost significantly less than they did just a year ago, presenting a genuine opportunity for both buying and refinancing. However, not all applicants will qualify for the most favorable rates.
How to Secure Better Mortgage Terms:
1. **Credit Score**: A solid credit history can lower perceived risk from lenders. Simple actions like paying bills on time and reducing credit card balances can lead to substantial savings.
2. **Comparison Shopping**: It is essential to compare offers from banks, credit unions, and online lenders. Even a 0.25 percentage point difference can greatly affect mortgage costs.
3. **Loan Term Choices**: Deciding between a 30-year and 15-year mortgage matters. While 15-year loans typically offer lower rates, they come with higher monthly payments.
4. **Down Payment**: Increasing the down payment can improve the loan applicant’s profile, lower the financed amount, and even eliminate private mortgage insurance (PMI).
Karoline Leavitt, White House Press Secretary, shared insights on the market’s current state: “Existing home sales in December rose at their fastest pace in three years… mortgage rates have fallen to their lowest level in years.” Leavitt noted that monthly housing payments are now at their lowest in two years, and the trend is expected to continue.
As mortgage rates reach the best levels seen in over a year, now is the time for homebuyers and homeowners to act. This window of opportunity may not last long, and those who are prepared, compare options, and make timely decisions can secure significant savings on their homes for years to come.
Share this urgent update with anyone considering buying or refinancing to ensure they don’t miss out on these crucial developments!
