Mortgage Rates Today: 30-Year Fixed Refinance Rate Drops by 5 Basis Points

Are you keeping an eye on mortgage rates like I am? It's a wild ride, but here's the good news: the average 30-year fixed refinance rate has dipped slightly. As of today, August 28, 2025, the national average stands at 6.83%, according to Zillow. That's a 5 basis point drop from last week's average of 6.88%. While it's not a massive plunge, any decrease is welcome news for homeowners considering a refinance.

Mortgage Rates Today: 30-Year Fixed Refinance Rate Goes Down by 5 Basis Points

What the Current Mortgage Rate Picture Looks Like

Let's break down the specifics a little further. While the 30-year fixed rate saw a modest decrease, other popular refinance options are holding steady:

• 30-Year Fixed Refinance Rate: 6.83% (down 5 basis points)
• 15-Year Fixed Refinance Rate: 5.61% (unchanged)
• 5-Year ARM Refinance Rate: 7.32% (unchanged)

While the drop in 30 year fixed rate maybe a reason to cheer up, there will be some questions popping in your head about the economic outlook. Let's get them clarified subsequently to help you build your knowledge.

Is Refinancing at 6.83% a Smart Move?

That's the million-dollar question, isn't it? The answer, as always, depends entirely on your individual circumstances. Here's what I consider when advising people I know:

• Your Current Mortgage Rate: If you're paying significantly higher than 6.83%, refinancing could save you money over the long term.
• How Long You Plan to Stay: Refinancing involves costs. If you plan to move in a year or two, the savings might not outweigh the fees.
• Your Financial Situation: Lenders will look at your credit score, debt-to-income ratio, and overall financial health.
• Closing Costs: These can add up! Factor them into your calculations to see if refinancing makes sense.

A Quick Example

Let's say you have \$300,000 left on your mortgage at 7.5%. Refinancing to 6.83% could potentially save you hundreds of dollars per month. Use a mortgage refinance calculator to get a personalized estimate. Do you know that as rates fluctuate, the savings also change?

Peering into the Crystal Ball: Mortgage Rate Forecasts

No one has a perfect crystal ball, but economic forecasts can give us a general idea of where mortgage rates might be headed:

• National Association of REALTORS®: Expects rates to average 6.4% in the second half of 2025 and 6.1% in 2026. They see lower rates as a “magic bullet” for the housing market.
• Realtor.com: Anticipates a slow easing of rates, potentially reaching 6.4% by year-end.
• Fannie Mae: Projects rates to end 2025 at 6.5% and 2026 at 6.1%. They've also revised their mortgage origination forecasts slightly downwards.
• Mortgage Bankers Association: Predicts rates will remain around 6.8% through September 2025, then settle in the mid-6% range for the rest of the year, ending near 6.7%. They foresee rates holding steady around 6.3% into 2026.

Forecasts Table

Source	End of 2025	End of 2026
National Association of REALTORS®	6.4%	6.1%
Realtor.com	6.4%	Not Provided
Fannie Mae	6.5%	6.1%
Mortgage Bankers Association	6.7%	6.3%

The Fed's Role: More Important Than Ever

The Federal Reserve's actions are the biggest influence on mortgage rates. Here's a recap of how they've impacted rates recently:

• Pandemic Era: The Fed's bond-buying program kept rates artificially low.
• 2022-2023: To combat inflation, the Fed aggressively raised the federal funds rate, pushing mortgage rates to 20-year highs.
• Late 2024: After holding steady, the Fed cut rates three times.
• 2025 (So Far): The Fed has paused rate hikes, but internal divisions suggest a potential shift.

The market currently anticipates a rate cut at the Fed's September 16-17 meeting. This expectation is based on:

• Cooling Inflation: CPI has moderated, moving closer to the Fed's target.
• Weakening Labor Market: Unemployment is rising, and job growth is slowing.
• Predicted Slowdown: Economic forecasts point to a cooldown.

All you have to do is keep an eye on Fed Chair Jerome Powell's speech at the Jackson Hole Economic Symposium on August 22.

What a Fed Rate Cut Could Mean for You

A September rate cut is widely expected to finally trigger a more sustained decline in mortgage rates. This could:

• Lower borrowing costs across the economy.
• Spur business investment.
• Create movements in stock and bond markets.

Keep in Mind!!!

While a September cut is highly probable, it's not guaranteed. Lingering inflation or unexpected economic strength could change the Fed's mind.

Key Dates and Scenarios to Watch

• September 16-17 Meeting: The next critical point. Watch for updated economic projections.
• December Meeting: Another potential opportunity for a rate cut.
• Long-Term: The Fed anticipates gradually easing, with rates potentially near 2.25%-2.5% by 2027.

What does all this mean for different people?

Current Buyers: Relief might be on the horizon! Be ready to act when rates drop.

Refinancers: If you're paying over 7%, keep a close eye on the September meeting. A rate cut could be your sign to refinance.

Investors: Bond markets are volatile, so stay informed of Fed rhetoric. A confirmed rate cut would likely push yields lower.

My Final Thoughts

While a 5 basis point drop is modest, it's a step in the right direction. The upcoming Fed meeting is a crucial event that could significantly impact mortgage rates. As always, do your research, consider your individual circumstances, and consult with a financial advisor before making any decisions. I'll be keeping my eye on the market and will update you with any more interesting developments!