Are Home Loan Rates Going Down? What Buyers Should Know in 2026

Genevieve Flieger
4 days ago
2 min read

If you’re thinking about buying a home or refinancing, one big question on everyone’s mind is: “Are mortgage rates finally going down?”

Where Rates Are Now

Right now, mortgage rates have pulled back from their near-7% highs seen in recent years. Many lenders are reporting that the average 30-year fixed mortgage rate is hovering around or just under 6%, a level we haven’t seen consistently since 2023.

Why Rates Are Trending Lower

There are a few reasons rates have eased:

Market forces and economic data — Investors expect slower inflation and continued efforts by lenders to price loans more competitively.
Federal Reserve policy changes — Although the Fed doesn’t set mortgage rates directly, cuts or expectations of stabilizing inflation tend to put downward pressure on long-term borrowing costs.Experts, including housing analysts and forecasts from groups like Fannie Mae, project rates could continue inching lower through 2026, potentially dipping below 6% more often than not.

Did the Government Try to Lower Rates?

Yes — earlier in January 2026, President Trump announced a plan aimed at lowering mortgage rates. He said he would instruct mortgage giants Fannie Mae and Freddie Mac to buy up to $200 billion in mortgage bonds. The idea is that more demand for these bonds could push prices up and, in turn, bring mortgage rates down.

This kind of bond-buying strategy echoes how the Federal Reserve has worked in the past — but through private government-sponsored entities rather than the central bank.

Will This Really Bring Down Your Rate?

Here’s the honest answer: possibly, but not dramatically.

Yes, markets reacted quickly: mortgage rates dipped below 6% right after the announcement.
But experts are cautious. Many analysts say the move might only shave off a small amount — perhaps a quarter-point or so — rather than a large drop that would suddenly make buying a home much easier for everyone.

In other words, the measure might help modestly, but it’s not a guarantee of a big rate plunge.

What This Means for You

If you’re ready to buy: Don’t wait forever hoping rates will fall a lot — they might move lower, but timing the market perfectly is very hard.
If you’re refinancing: Check rates often. Even a small drop (like from 6.25% to 5.75%) can significantly lower your monthly payment.
Watch economic signals: Inflation, Federal Reserve policy, and housing supply trends all affect rates — and those factors will continue shaping rate movement throughout 2026.

Bottom line: Mortgage rates have been trending down and there’s some momentum behind further decreases, but large swings are unlikely. Recent government actions may help nudge rates lower, but buyers should make decisions based on their personal goals more than trying to time the market.