Mortgage Rates Predictions Next 90 Days: October to December 2025

Here's the bottom line upfront: Most experts believe mortgage rates will dip slightly over the next 90 days, likely settling in the 6.2% to 6.5% range by mid-December 2025. While this offers a glimmer of hope for potential homebuyers, significant drops below 6% are generally not expected, especially without a more pronounced economic slowdown.

It feels like everyone is talking about mortgage rates these days, and if you're thinking about buying a home or refinancing, you're probably wondering what's going to happen next. I've been digging into what the smart folks who study this stuff are saying, and it looks like we're in for a bit of a breather on mortgage costs, but nothing drastic.

Mortgage Rate Predictions for the Next 90 Days: Will Rates Drop by Year-End?

The Current View: A Welcome Dip

As of mid-September 2025, things are looking a bit more favorable than they have been. The average 30-year fixed mortgage rate is sitting around 6.35%. This is actually a nice drop from just a week ago, the biggest one we've seen this year! For a while there, especially in the summer, rates were stuck in the mid-6% range, and even higher earlier in 2025. Remember those peaks above 7% in late 2024? We've definitely moved past those.

For context, if you're considering a 15-year mortgage, rates are even better, hovering around 5.5%. Adjustable-rate mortgages (ARMs) might offer a slightly lower starting rate, but they come with the risk that your payment could go up later.

It's important to remember that even these “lower” rates are still quite a bit higher than the rock-bottom rates we saw a few years back. Back then, getting a mortgage at 3% or 4% was common. Now, on a $400,000 loan, your monthly payment for just the principal and interest is around $2,500 – that's about 20% more than it was just two years ago. This really makes a difference for affordability.

What's Driving the Rate Movement?

So, why are rates expected to ease a bit in the last quarter of 2025 (October, November, December)? It all comes down to a few key economic ingredients:

1. The Federal Reserve's Moves: The big player here is the Federal Reserve, often called “the Fed.” They control the federal funds rate, which is like the interest rate banks charge each other. Right now, it's sitting between 4.25% and 4.50%. The general feeling in the market is that the Fed will cut this rate by 0.25% at their September meeting. If inflation continues to cool down, they might even cut it again in December. However, if inflation doesn't cooperate, they might hold off on more cuts, which would keep mortgage rates from dropping much further.
2. Inflation and Bond Yields: Inflation is a major concern for the Fed. While the Consumer Price Index (CPI) for August showed some cooling, coming in at 3.3% year-over-year, the “core” inflation (which excludes food and energy) is still higher than the Fed's target of 2%. Mortgage rates are closely tied to the yields on 10-year Treasury bonds. These yields have dipped recently to around 4.2%, and if they keep going down, mortgage rates will likely follow.
3. Jobs and Economic Growth: We're looking for signs that the economy is healthy but not too hot, which can make the Fed nervous about inflation. A weaker jobs report, like the one in August (where fewer jobs were added than expected), can be a good sign for lower mortgage rates. However, if the economy stays strong, the Fed might be less eager to cut rates. Forecasts for economic growth (GDP) in 2025 have been revised down a bit, suggesting a slower pace, which generally supports lower rates.
4. Global Issues and Policies: Things happening around the world, or even new policies here at home, can shake things up. For example, if new tariffs are put in place, that could increase prices and potentially push inflation higher, which is bad news for mortgage rates. Global supply chain issues can also add a layer of unpredictability.

All these factors suggest a careful balance. If the economy cools off a bit without falling into a full-blown recession, we're likely to see rates drift lower.

What the Experts Are Saying: A Nudge Downward

When I look at what major organizations like Fannie Mae, the Mortgage Bankers Association (MBA), and the National Association of Realtors (NAR) are predicting, there's a pretty strong agreement: rates will probably come down a little by the end of the year. The exact numbers vary, but most are forecasting the 30-year fixed rate to be somewhere in the 6.4% to 6.7% range by December.

Here’s a look at some of their predictions:

Forecaster	Predicted Q4 2025 Average Rate	Predicted End-of-2025 Rate	What They're Seeing
Fannie Mae	6.5%	6.5%	Expects slower growth; sees rates falling further into 2026.
Mortgage Bankers Association	6.6%	6.6%	Based on the idea of two Fed rate cuts; rates should stabilize in the mid-6s.
National Assoc. of Realtors	6.7%	6.7%	Highlights how tough affordability is right now.
Realtor.com	6.4%	6.4%	Optimistic about a late-year drop if more homes come on the market.
Wells Fargo	6.67%	–	Cautious due to ongoing inflation worries.
Long Forecast	~5.9%	5.84%	Predicts a more significant drop.

It's interesting to see how some of these institutions revise their forecasts as new information comes out. For instance, Fannie Mae recently lowered its rate predictions because the economy seems to be growing a bit slower than they initially thought.

My take on this is that the consensus points towards a modest easing. We're probably looking at about a 0.1% to 0.5% drop from where rates are now. Getting back to those sub-6% rates we saw a few years ago just doesn't seem likely with the current economic picture.

What This Means for You: Buyers and Sellers

So, what does this mean for people looking to buy or sell homes?

• For Buyers: A small drop in rates can definitely help. It might make that dream home a little more affordable, potentially saving you roughly $60 a month on a $350,000 loan compared to rates a few months ago. This could encourage about 5% to 10% more buyers to enter the market. However, even with slightly lower rates, affordability is still a challenge for many, especially first-time buyers who might be seeing down payment requirements that feel impossible.
• For Sellers: If rates tick down, you might see a little more interest from buyers. However, with the overall low number of homes available for sale – we're talking less than 4 months' supply – home prices are likely to stay pretty firm. You probably won't see huge price drops, but it could mean your home sells a bit faster if priced right.
• For Refinancers: If you took out a mortgage in 2020 or 2021 when rates were super low, a small drop might not be enough to make refinancing worthwhile. You'd likely need a drop of at least 0.75% to truly see significant savings that pay off the costs of refinancing within a few years.

Looking Back: History Repeats Itself?

It's kind of like what happened back in 2018 and 2019. Rates had risen, then started coming down as trade tensions grew. That last period of falling rates led to more home sales. If we see a similar drop now, it could boost sales, but the current shortage of homes for sale and the large number of homeowners “locked in” to their low rates (meaning they don't want to sell their current home and buy a new one with a higher rate) could limit how much the market really picks up.

How to Navigate the Next Few Months

If you're in the market or thinking about it, here are a few things I’d recommend:

• Buyers: If you're serious about buying soon, get your mortgage pre-approval done now. Shop around with at least 3–5 different lenders, as even small differences in rates can add up. Some lenders offer “float-down” options, which let you lower your rate if it falls before you close, which could be a smart move.
• Sellers: Price your home competitively. With the seasons changing, buyers might be a bit more selective, so making your home as appealing as possible is key.
• Anyone thinking about refinancing: Use online mortgage calculators to see if a potential rate drop makes financial sense for you. If your current rate is significantly higher than the projected future rates, it might be worth keeping an eye on.
• Stay Informed: Keep an eye on weekly mortgage rate surveys from sources like Freddie Mac, and pay attention to the Federal Reserve’s meeting minutes. This will give you a clearer picture of what's influencing rates.
• Savings Strategy: If you're saving for a down payment, look into high-yield savings accounts that are offering good interest rates (we're seeing APYs around 4.5% on some of these). This can help your savings grow while you wait for rates to potentially drop.

In the end, the next 90 days look set to bring a bit of relief in the mortgage rate department, but it’s more of a gentle trend than a dramatic shift. Being prepared and informed will be your best bet, no matter what the numbers do.