Homeownership And Hurricane Season — The Quick Read: As of September 28, 2026, three things changed for owners at once. The Fed raised its target range on September 16, Fannie Mae said it will align with Freddie Mac on proactive outreach about canceling private mortgage insurance, and the storm season still has two months to run. Record home equity is a real cushion. It is also an average, and it hides a group of owners who have none.
Key Takeaways
- The Fed’s September 16 hike raises the cost of prime-linked debt, such as a variable HELOC. It does not directly reprice a fixed mortgage you already hold.
- Fannie Mae’s PMI change is about outreach. Servicers may contact borrowers who might qualify to cancel. Cancellation is not automatic, and existing rules still apply.
- Tappable equity hit a record in ICE’s August report, but about 813,000 borrowers are underwater, up 44% from a year earlier.
- Standard homeowners policies do not cover flood, and flood policies carry a waiting period. Recheck coverage before you need it.
- The weekly rate surveys are averages, not quotes. They also disagree with each other for good reasons.
What Changed This Month
The Fed raised rates, and nobody was surprised. On September 16, the Federal Reserve’s FOMC statement put the vote at 12–0 to raise the target range by a quarter point, to 3-3/4 to 4 percent. Kiplinger describes it as the first Fed increase since 2023. The July minutes, published August 19, said markets were already fully pricing a September hike.
The next step is less settled. CNBC reports that eight officials see another hike in 2027, six see a hold, and four see cuts. TD Economics says the median projection for this year’s funds rate rose to 4.1%, from 3.8%. It reads that as room for another increase by year-end.
Mortgage rates moved up too. Here is the Freddie Mac path for September:
- Week of September 3: 6.71%, up 5 basis points.
- Week of September 10: 6.76%, up 5 basis points.
- Week of September 17: 6.95%, up 19 basis points.
- Week of September 24: 7.03%, up 8 basis points.
Freddie Mac’s survey put the 30-year fixed at 7.03% for the week of September 24, against 6.30% a year earlier. The 15-year averaged 6.42%. From the 6.66% reading that preceded the September 3 release, that is a 37-basis-point climb in four weeks.
The MBA’s weekly survey, released September 23 for the week ending September 18, shows the same direction. The MBA reported its 30-year contract rate at 7.12%, up from 6.97%. Mortgage News Daily’s index read 7.43% on September 25, down 2 basis points on the day.
Why three different numbers? They measure different things:
- Freddie Mac surveys conforming purchase loans and focuses on borrowers with 20% down and excellent credit.
- The MBA reports contract terms from the applications it tracks.
- Mortgage News Daily publishes a daily market index.
- Each of these measures a different slice of the market, so the differences between them are expected, and none of them reflects a specific lender’s guidelines or a full review of property, leverage, and credit.
I would not average them. Treat each as a gauge and none as a quote. Your own number depends on your file, your property, and the day it is priced.
Demand cooled. In the same MBA release, total applications fell 1.5%. The Refinance Index dropped 3% and sat 62% below a year earlier. The seasonally adjusted Purchase Index fell 1% and was 11% lower year over year.
NAR’s report on existing-home sales, released September 10, showed August sales down 2.0% from July and 1.2% from a year earlier. Inventory rose to 1.62 million homes, or 4.9 months of supply. NAR’s chief economist called that the highest supply in over ten years. The median price rose 1.6% to $429,100.
New homes tell a noisier story. Census data released September 24 showed 684,000 annualized sales, with an 8.5-month supply and a median price of $393,700. Inman notes the Census Bureau did not consider the monthly change statistically significant. It also reports that 38% of builders offered discounts in September. I would not call that a turnaround.
What Does the PMI Change Actually Do?
It changes who makes the first phone call. On September 15, FHFA Director Bill Pulte said Fannie Mae will align with Freddie Mac’s policy, per HousingWire. Servicers may now reach out to borrowers on agency-backed loans who may qualify to cancel private mortgage insurance. That is the monthly premium many buyers pay when they put less than a full down payment on a conventional loan.
Three limits matter:
1. This is outreach, not automatic cancellation. WRE News reports that existing eligibility, payment-history and valuation rules still apply. 2. The announcement carried no implementation date and no estimate of homeowner savings. 3. Some borrowers may find the proof of value is the sticking point. A new appraisal costs money, and a few may decide to keep paying.
The background is the Homeowners Protection Act of 1998. A borrower can request cancellation once the balance falls far enough against the original value, and the law requires it at a lower threshold. Fannie already lets servicers contact borrowers who are approaching it. The new piece covers owners whose home-value gains have put them at or past it.
Here is who should pay attention. If you bought in the last several years, put less than a full down payment on a conventional loan, and your home has risen in value, you may be paying for insurance you no longer need. A call to your servicer costs nothing. I would make it without waiting for the letter.
What Does It Mean for Owners With Equity?
The equity is real, and so are the limits. ICE’s August Mortgage Monitor, summarized by MBA Newslink on August 11, put total homeowner equity at an all-time high of $18 trillion in the second quarter. About 47.5 million holders had $11.7 trillion of it tappable, an average near $246,000 each. Tappable means what an owner could borrow against while keeping a cushion in the home.
That is a big number. It is also a pooled estimate. An average across 47.5 million households says little about the one in your driveway.
The group left out. Per Inman’s coverage of the same ICE data, about 813,000 borrowers are underwater, meaning they owe more than the home is worth. That is up 44% from a year earlier. They are concentrated among FHA and VA borrowers, and mostly people who bought between 2022 and 2025. About 320,000 were both underwater and behind on payments. Texas and Florida account for 39% of underwater homes.
Texas and Florida are also hurricane country. I want to be careful here. The sources do not tie the underwater count to storm risk. The overlap is a fact about geography, not a finding about cause. But an owner with no equity and no rainy-day fund has the fewest options after a loss. That is worth sitting with.
Other ICE figures from August 10, reported by HousingWire: the national delinquency rate was 3.55% in June, and active foreclosure was 0.53%, a six-year high. Annual home price growth was 1.5% in July, and ICE said further acceleration in the second half may be limited.
Where the HELOC fits. A home equity line of credit is a revolving line secured by your home. Most carry a variable rate tied to the prime rate, which moves with the Fed. When the Fed raised its target by a quarter point on September 16, prime-linked debt got more expensive. A fixed-rate first mortgage does not reprice because of that decision. Fixed mortgage rates follow long-term yields and bond spreads instead. CNBC said the 10-year Treasury had already risen about a quarter point since Chair Warsh spoke at Jackson Hole on August 28.
This is why the “my 30-year went up because the Fed hiked” line is a misreading. The Fed hike hits the variable stuff first.
There is a second wrinkle. ICE reported in June that second-lien withdrawals hit an 18-year high in the first quarter. Owners were borrowing against equity to keep their low-rate first mortgages. A higher prime rate takes some of the shine off that move. A closed-end second mortgage, which is a lump sum with a fixed schedule, is typically fixed. A variable line leaves your balance exposed to prime. Existing fixed seconds do not reprice automatically.
If you want to see how the options compare, our HELOC programs page carries the current guidelines, and each is subject to lender guidelines. I’m leaving the figures to that page on purpose.
My Take
I think the headline “record equity” is doing too much work this month. It is true, and it is comforting, and it can mislead an owner who skims it. Three things I’d say plainly.
First, the PMI change is small but useful. It will not rewrite anyone’s budget on its own. With no effective date, no automatic cancellation and no savings estimate, it is a nudge. Still, nudges matter. Many owners pay premiums for years past the point they had to. Servicer outreach could close some of that gap. I would not count on it, though, so ask your servicer directly whether your premium can come off.
Second, the Fed hike is a floating-debt story. If you carry a variable line, your cost moved. If you hold a fixed first mortgage, it did not. The harder question is the one the dot plot leaves open: will there be another hike? Eight officials see one in 2027. Four see cuts. When the people setting policy can’t agree, I’d plan for either outcome rather than bet on one.
Third, a quiet storm season is not a safe one. The PIA’s September 16 post notes the Atlantic season runs through November 30. A strong El Niño has muted it, and no hurricanes had formed as of that date. But one landfall can do heavy damage. The same post makes a point I agree with: your mapped flood zone does not define your risk.
This is a genuine toss-up for some owners. A HELOC opened before a storm is a backstop. It costs more this month than it did last month. Does that outweigh having the liquidity ready? I lean toward having the option, and I would size it modestly. Your situation may point the other way. If you’d have to borrow at a stretch just to repair a roof, the better answer may be a larger cash reserve, not more debt.
What I’d Do Now
None of this is advice to buy or sell anything. It’s a checklist I’d run on my own house.
Check your coverage. FEMA said on June 1 that standard homeowners and renters insurance do not cover flooding. Flood policies carry a waiting period before they take effect. That means the time to ask is now, not when the forecast turns. Read your wind and named-storm deductible too. It is often a percentage of the home’s insured value rather than a flat amount, and that surprises people.
Check your cushion. Count the cash you could reach without borrowing. Then count what you could reach by borrowing. If the second number is most of your plan, rethink it.
Know what you owe and how it reprices. Pull your statements. Is the first mortgage fixed? Is there a line or a second on top of it? Is it tied to prime? Write down which balances move with the Fed and which don’t.
Ask your servicer about PMI. If you pay it, request a cancellation review. Ask what proof of value they accept, and what it costs. Existing eligibility rules still apply, so the answer may be “not yet.” Better to know.
Reading a rate quote. If you are shopping, remember that the weekly surveys are averages of one loan type. Quotes gathered on different days are not comparable, because rates moved 19 basis points in a single week this month. Gather your quotes the same day when you can. And if you see a number you like and the deal is ready, lock it. A lock fixes the quoted rate for a set period. Floating means leaving it open to the market. In a month like this one, floating is a bet, and I would call it that.
If you own rental property. A higher-rate month changes the math on rentals too. Our guide to DSCR loans explains how these investor loans qualify on the property’s rent instead of personal income, subject to lender guidelines.
If you’re weighing a purchase or a refinance this fall, Lendmire can walk you through how the current programs fit your file.
Frequently Asked Questions
Did the Fed’s hike raise my fixed mortgage rate?
No. A fixed-rate mortgage you already hold does not reprice when the Fed moves. Prime-linked debt, such as a variable HELOC, does. Fixed mortgage rates for new loans follow long-term yields and bond spreads, which were already rising before September 16.
Is my PMI now canceled automatically?
No. The policy change lets servicers contact borrowers on agency-backed loans who may qualify to cancel. Existing eligibility, payment-history and valuation rules still apply. There is no implementation date yet, so ask your servicer what documentation they would accept.
Why do the weekly mortgage rate numbers disagree?
They measure different things. For the week of September 24, Freddie Mac’s survey showed 7.03%, the MBA’s September 23 release showed 7.12%, and Mortgage News Daily’s index read 7.43% on September 25. Freddie’s survey centers on borrowers with 20% down and excellent credit. All three are averages, not quotes. Terms vary by lender guidelines, property type, leverage, credit profile, and full file review.
Does record home equity mean I can borrow against mine?
Not necessarily. ICE’s $11.7 trillion tappable figure is a pooled estimate across 47.5 million holders. About 813,000 borrowers are underwater, per ICE’s August data. Whether you can borrow depends on your own balance, your home’s value, and lender guidelines for the product you choose.
Does homeowners insurance cover hurricane flooding?
Usually not. FEMA says standard homeowners and renters policies do not cover flooding. Flood coverage is a separate policy and comes with a waiting period. Check this before a storm is on the map, and read your wind deductible while you’re at it.
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References
1. Federal Reserve FOMC statement, September 16, 2026
2. Kiplinger
3. Federal Reserve FOMC minutes, July 2026 meeting
4. CNBC
5. TD Economics
6. MBA Weekly Applications Survey, September 23, 2026
7. NAR August existing-home sales, September 10, 2026
8. Inman, new-home sales, September 25, 2026
9. HousingWire, FHFA and PMI outreach, September 15, 2026
10. WRE News
11. MBA Newslink on the ICE Mortgage Monitor, August 11, 2026
12. Inman’s coverage of the same ICE data
13. HousingWire
This article is part of Lendmire’s Mortgage News series — every loan program’s qualification details, guidelines, and scenarios live on the loan options page.
Related reading: Why A Local Real Estate Broker Matters As Buyers Gain Leverage, September 2026? · September 2026: Buyers Need A Real Estate Agent As Supply Grows, Rates Climb · Listing Your Home For Sale This Fall As Inventory Climbs And Rates Rise
Brandon Miller
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Important disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage brokerage. Lendmire is not a direct lender, depository institution, or financial advisor. All loan inquiries are subject to lender underwriting; this article does not constitute a commitment to lend. Rates, terms, and program guidelines are subject to change without notice and vary by borrower profile, property type, and state. Information in this article is general in nature and is not financial, legal, or tax advice. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.