The Quick Read: As of September 28, 2026, mortgage costs have risen four weeks in a row, the Fed has made its first hike since 2023, and the 10-year Treasury yield sits at a 19-year high. Buyers who come out ahead this fall will rebuild their budgets at today’s cost of money and hold more cash for closing. They’ll also use a market with more homes for sale to negotiate harder. Waiting for the Fed to rescue your budget is not a plan.
Key takeaways
- Freddie Mac’s weekly average for the 30-year fixed rose four weeks in a row through the week of September 24. The total increase was about 37 basis points.
- Mortgage rates track long-term Treasury yields more closely than the Fed’s policy rate. On September 23, the 10-year yield reached its highest level since July 2007.
- Supply favors buyers. NAR’s August report, released September 10, showed 4.9 months of existing-home supply, the most in over ten years.
- Builders are bargaining. Two in three used sales incentives in NAHB’s September survey.
- Preparing now means three things: a stress-tested budget, a bigger cash cushion, and a clear plan for when to lock.
What Changed in September?
Three things moved at once. The Fed raised its policy rate on September 16, and Freddie Mac’s weekly mortgage average rose for a fourth straight week. The 10-year Treasury yield also climbed to its highest level since 2007. Any one of these would matter on its own. Together, they reset the cost of buying a home this fall.
Start with the Fed. The Federal Reserve raised the federal funds target range by a quarter point to 3-3/4 to 4 percent on September 16, 2026. The vote was 12–0. CNBC called it the Fed’s first increase since 2023 and noted that the committee’s projections point to possible further hikes this year.
Mortgage rates were already rising before the hike. A basis point is one-hundredth of a percentage point, and the weekly moves were measured in those. Freddie Mac’s Primary Mortgage Market Survey put the 30-year fixed at 6.71% for the week of September 3, up from 6.66%. Freddie Mac’s survey then showed 6.76% on September 10. On September 17, in the first reading after the hike, Freddie Mac’s average jumped 19 basis points to 6.95%.
Then came the milestone. Freddie Mac’s survey put the 30-year fixed at 7.03% for the week of September 24, against 6.30% a year earlier. That’s roughly 37 basis points in four weeks. The same Freddie Mac survey had the 15-year average at 6.42%, up from 6.26%.
The bond market is the bigger story. CNBC reported that the 10-year Treasury yield jumped more than 13 basis points to 5.104% on September 23. That was its biggest one-day move in nearly 18 months and its highest level since July 2007. By Friday, September 25, CNBC had the 10-year at 5.23%, up from just under 4.8% earlier in the month. CNBC’s September 26 report also cited futures pricing of roughly a 64% chance of another Fed hike in October.
Borrowers reacted. The Mortgage Bankers Association’s weekly survey, released September 23, showed total applications down 1.5% for the week ending September 18. Refinance applications fell 3% and sat 62% below a year earlier. On the unadjusted measure, purchase applications were 11% below last year. The same survey showed the average 30-year contract rate climbing higher that week.
One more number stood out. CNBC, citing the MBA, reported that adjustable-rate loans made up 9.8% of applications, up from 8.4% two weeks earlier. Borrowers are reaching for relief wherever they can find it.
What It Means for Home Buyers
The budget you built this summer is out of date. The same loan now costs more each month, so the price you can carry has dropped unless your income or cash has grown. The good news is on the other side of the table. More homes are for sale, and sellers and builders have more reasons to deal.
Think about the full monthly carry: principal, interest, property taxes, homeowners insurance, and any HOA dues. When rates rise, taxes and insurance stay where they were, but the largest line in the budget gets bigger. That squeeze falls entirely on how much house you can buy.
Here’s a plain hypothetical. Say you ran your numbers in July at 6.5% and the market reaches 7.5% by the time you’re under contract. That’s a full percentage point on a 30-year loan. Not a rounding error.
Here’s the catch most headlines skip. Freddie Mac’s September 24 release says the survey covers only conventional, conforming, fully amortizing purchase loans for borrowers with excellent credit and a large down payment. If your credit, down payment, or income profile looks different, your pricing will look different too. The survey is a benchmark, not a quote.
The survey also lags. Mortgage News Daily’s daily index hit 7.45% on September 24, the same day Freddie Mac reported its 7.03% weekly average. Mortgage News Daily explains that the difference comes from timing. Freddie Mac’s survey averages rates collected over the prior several days, while the daily index tracks the market as it moves. Two different numbers. Both accurate.
The daily market has kept climbing. On September 28, Mortgage News Daily’s index page said the average lender was at 7.50% for the first time since April 30, 2024. That reading came after a Friday rally faded.
Some buyers won’t fit a conventional file at all. That includes self-employed borrowers, commission earners, and people whose wealth sits in assets rather than a paycheck. Non-QM programs qualify borrowers on other kinds of documentation, subject to lender guidelines. Our loan options page carries the current guidelines for each program. Check it before you assume a program fits your file.
Did the Fed Just Raise Mortgage Rates?
Not directly. Mortgage rates track long-term bond yields, and those moved much more than the Fed’s policy rate did. The quarter-point hike on September 16 mattered mostly as a signal about inflation and future hikes. According to CNBC, the 10-year yield rose roughly 40 basis points in a few weeks, and mortgage pricing followed the bond market.
This misreading causes real damage. A buyer who believes the Fed sets mortgage rates will wait for a Fed cut, assuming rates will drop the next day. Rates don’t work that way. The long end of the bond market can rise while the Fed holds steady, and it can fall before the Fed acts.
Two other misreadings are worth fixing while we’re here.
More inventory does not mean falling prices. NAR’s existing-home sales data for August put the national median price at $429,100, up 1.6% from a year earlier. Inventory is up, and so are prices, just slowly. Negotiating room and falling prices are not the same thing.
Sellers are not obligated to take less. Realtor.com’s release this month found that active listings are still about 11% below pre-pandemic levels nationally. The market has loosened, not collapsed. A lowball offer on a well-priced house can still lose.
Where Is the Negotiating Room?
The room is widest with builders. Census data put new-home supply at 8.5 months in August, compared with 4.9 months for existing homes in NAR’s count. Builders are cutting prices and using incentives more than they have since December. Resale sellers have softened, but they still hold more cards than a builder sitting on finished inventory.
Here’s the side-by-side. The existing-home figures come from the NAR’s August existing-home sales release dated September 10. The new-home figures come from the Census Bureau and HUD’s August new residential sales report.
| Measure (August 2026) | Existing homes (NAR) | New homes (Census/HUD) |
|---|---|---|
| Annual sales pace | 3.98 million | 684,000 |
| Months of supply | 4.9 | 8.5 |
| Homes for sale | 1.62 million | 483,000 |
| Sales vs. a year earlier | Down 1.2% | Down 2.0% |
On the resale side, NAR’s release showed sales down 2.0% from July, with inventory up 5.9% from a year earlier. Supply rose from 4.6 months in July, and NAR said the added supply gives buyers better chances to negotiate. I agree with that read.
On the new-home side, the Census report showed sales up 6.4% from July. Both the monthly and yearly changes fall within the survey’s stated margin of error, so don’t read too much into either one. The supply number is the signal that matters: 8.5 months, down from 9.0 in July, is still a lot of homes.
The builder survey fills in the rest. In NAHB’s September Housing Market Index, builder confidence fell 3 points to 32, its lowest since September 2025. The share of builders cutting prices rose to 38% from 35%, and the average cut held at 6%. Incentive use rose to 66% from 63%, the highest share since December. NAHB said buyer traffic has weakened largely because of rising mortgage rates.
Notice that NAHB counts price cuts and incentives separately. An incentive is not automatically a discount. It might be a closing-cost credit, an upgrade package, or money toward a lower rate. Some of those help your budget more than others.
This is where I have to weigh it out loud. A price cut lowers the loan amount, and you keep that benefit for the life of the loan. A credit toward a rate buydown lowers the monthly carry, which helps you qualify and eases the first years. If rates fall and you refinance, though, the buydown’s value goes away. The price cut is the steadier win. The buydown is the better fix for a tight budget. My lean is the price cut for anyone planning to stay put, and the buydown for anyone stretched on the monthly number (though a builder offering both deserves a very close look).
One more dated detail. Realtor.com named September 27 through October 3 as this year’s best week to buy, with about 13% more active listings than an average week. That week has already passed.
My Take
Eighteen years in lending have taught me that nobody rings a bell at the top of a rate cycle. I can’t tell you where the 10-year goes next, and neither can anyone else. What I can tell you is what the data say about the next month or so: futures are leaning toward another hike, the bond market is still moving, and the daily index is running ahead of the weekly survey.
My read is simple. Price the house at today’s cost of money. If rates drop later, treat it as a bonus. The buyers who get hurt are the ones who stretch their budget on the hope of a refinance.
Refinancing is an option. It is not a strategy. If a future refinance is part of your thinking, first learn how a cash-out refinance differs from a rate-and-term refinance. They solve different problems. Neither is promised to you on any schedule.
The rise in adjustable-rate applications tells me borrowers feel the squeeze. An ARM can make sense when you have a real plan for the reset: a planned move, a known income jump, or a payoff target. It’s a poor fit when the only plan is “rates will come down.” That isn’t a plan. It’s a bet.
I’ll hedge once, because the facts demand it. If inflation cools and the long end rallies, this column will look too cautious. I’d rather be cautious with a mortgage than lucky.
What I’d Do Now
Rebuild the budget at the daily market, not the weekly headline. Then stress-test it higher and hold more cash than you planned. Get a fresh preapproval, compare quotes gathered on the same day, and know your lock plan before you make an offer. Then negotiate for the rate as hard as you negotiate for the price.
Here’s the sequence I’d follow.
1. Rerun the numbers at today’s market. Use a current daily reading, not July’s memory. Mortgage News Daily’s index was well above Freddie Mac’s weekly average on September 24. Budget off the higher number.
2. Stress-test above that. As a plain hypothetical, run your budget again a half point higher and a full point higher. If the house only works at the lower number, it’s the wrong house or the wrong time.
3. Widen the cash cushion. Closing costs, prepaid taxes and insurance, and reserves all come due before you get the keys. Add room to extend a rate lock if the closing slips. If you might buy down the rate yourself, that money comes due at closing too.
4. Refresh your preapproval. A letter issued on summer pricing overstates what you can borrow now. Ask for it to be rerun on current terms.
5. Compare quotes from the same day. Loan Estimates gathered on different days aren’t comparable, because the market moves in between. Mortgage News Daily’s index moved about 19 basis points between September 23 and September 24 alone. Same day, same loan, same assumptions, or the comparison is noise.
6. Know what a lock is before you need one. A rate lock is a lender’s commitment to hold a rate and terms for a set period while the loan is processed. Floating means leaving the rate open and hoping it improves. With the Fed and the bond market both pointing up, floating is a wager. My rule: if you like the numbers once you’re under contract, lock them.
7. Negotiate for the carry. Ask builders and sellers for credits toward the rate or closing costs, not just a lower price. Get every concession written into the contract. How much a credit can cover depends on program rules and lender guidelines, so confirm that before you count on it.
8. Keep the credit file quiet. No new car loan, no new store card, no big unexplained deposits. Skip it until after closing.
None of this depends on guessing where rates go. That’s the point. Preparation works in either direction.
Talk It Through Before You Write an Offer
If you’re weighing a purchase this fall, Lendmire can walk you through how the current programs fit your file. As a non-QM mortgage broker, we compare options across the lenders we work with, and those lenders make every eligibility decision. Call 828-256-2183 and bring your numbers.
For the end-to-end picture of how these loans work — qualification, structures, and the full process — see Lendmire’s complete DSCR loans guide.
Frequently Asked Questions
Why is the rate I’m seeing higher than the Freddie Mac number in the news?
Freddie Mac’s survey lags the market and describes a narrow borrower. According to its September 24 release, the survey covers conventional, conforming purchase loans for borrowers with excellent credit and a large down payment. Mortgage News Daily’s daily index was running well above the weekly average that same day. Your own pricing depends on your credit, your down payment, the loan type, and the day you ask.
Are home prices falling now that there’s more inventory?
Not nationally, at least not yet. NAR’s August data put the median existing-home price at $429,100, up 1.6% from a year earlier, even as supply reached 4.9 months. What you have is more room to negotiate, especially on homes that have sat on the market. Local markets vary, so read your own area’s numbers rather than the national average.
Is a builder incentive as good as a price cut?
Sometimes, but not by default. NAHB’s September survey counts price cuts (38% of builders) separately from incentives (66%). A price cut lowers the loan for its full life. A rate buydown lowers the monthly carry but loses value if you refinance, so match the concession to how long you plan to stay.
Does an adjustable-rate mortgage make sense right now?
It can, if you have a concrete plan for the reset. CNBC, citing the MBA, reported that ARMs reached 9.8% of applications in late September, which shows how many borrowers are hunting for relief. An ARM fits a known timeline, such as a planned move or an expected income change. It fits poorly when the whole plan depends on rates falling.
About Lendmire
Lendmire — NMLS# 2371349 — is a mortgage brokerage whose founder writes this column. DSCR investor programs reach 41 markets, including Washington, D.C.; consumer programs such as bank statement, HELOC and down payment assistance loans are arranged in 16 states; every loan is placed with, and underwritten by, a wholesale lender under that lender’s guidelines. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
1. Federal Reserve FOMC statement, September 16, 2026
2. Freddie Mac Primary Mortgage Market Survey, September 24, 2026
3. Mortgage Bankers Association Weekly Applications Survey, September 23, 2026
4. NAR existing-home sales data
5. NAR August existing-home sales release, September 10, 2026
6. NAHB/Wells Fargo Housing Market Index, September 2026
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: Preparing Financially For Homeownership As Rates Climb, September 2026 · Qualified Opportunity Zone Buyers Face Treasury Yields Near A 19-year High · Timing A Home Purchase In September 2026: If You Like The Rate, Lock It
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Disclosures. The information presented in this article is general market commentary, not financial, legal, or tax advice. Lendmire is a mortgage brokerage (NMLS# 2371349) — not a direct lender or depository institution — and loan placement is subject to lender underwriting. Nothing in this content represents a commitment to lend. Loan terms, pricing, and program availability vary based on borrower qualifications, property characteristics, and state of subject property, and are subject to change at any time. Lendmire complies with Equal Housing Opportunity requirements. Consumer access: nmlsconsumeraccess.org.