Today’s Mortgage Rates – August 28, 2025: Rates Drop, 30-Year FRM Punges by 15 Basis Points

Mortgage rates today, August 28, 2025, show a modest but noteworthy drop across various loan types. The average 30-year fixed mortgage rate decreased to 6.52% from 6.67% the previous week, signaling a slow downward trend in borrowing costs. Refinance rates mirrored this dip with the 30-year fixed refinance rate falling slightly to 6.83%. These changes suggest a cautious optimism amid economic signals pointing toward a possible Federal Reserve rate cut in September 2025. This update is critical for buyers and refinancers assessing their mortgage options.

Today's Mortgage Rates – August 28, 2025: Rates Drop, 30-Year FRM Punges by 15 Basis Points

Key Takeaways

• 30-year fixed mortgage rates fell to 6.52%, down 15 basis points from last week.
• 15-year fixed rates also dropped, now averaging 5.58%.
• 5-year ARM mortgage rates decreased to 6.77%.
• Refinance rates are slightly lower with the 30-year fixed refinance rate at 6.83%.
• Experts expect mortgage rates to remain above 6% for the next several quarters.
• Market anticipates a likely Federal Reserve rate cut in September, potentially pushing rates lower.
• Fannie Mae forecasts mortgage rates to dip below 6% only by Q3 2026.
• Economic indicators such as inflation and employment data heavily influence mortgage rate trends.

Understanding Mortgage Rates Today: August 28, 2025

Mortgage rates fluctuate based on various economic factors—primarily inflation, Federal Reserve policies, and job market strength. As of today, the typical rate for a 30-year fixed mortgage is 6.52%, down from last week’s 6.67% (Zillow 2025). This subtle decline marks the first movement after several months of relatively stable but elevated rates between 6.6% and 6.8%.

The drop in mortgage rates follows weak job growth data in recent months, which tempered inflation expectations. Likewise, inflation remains sticky but has cooled enough to hint that the Federal Reserve may lower its benchmark interest rates soon—the first possible cut since a series of hikes during 2022-2023. The market currently prices in a 91% chance of a 25 basis point cut in September.

Mortgage Rate Trends in 2025

A quick look back: Mortgage rates surged after the Federal Reserve aggressively increased the federal funds rate by over 5 percentage points from March 2022 through July 2023 in response to inflation. These increases pushed mortgage rates to two-decade highs. However, in late 2024, the Fed shifted course, easing rates and holding them steady through 2025, while the market anticipated potential rate cuts as economic growth slowed.

Current Mortgage Rates by Loan Type (August 28, 2025)

Loan Program	Rate (%)	Weekly Change	APR (%)	APR Weekly Change
Conforming Loans
30-Year Fixed	6.52	-0.15%	6.94	-0.18%
20-Year Fixed	6.43	0.00%	6.94	+0.03%
15-Year Fixed	5.58	-0.19%	5.86	-0.21%
10-Year Fixed	5.79	0.00%	6.09	0.00%
7-Year ARM	6.63	-0.57%	7.59	-0.16%
5-Year ARM	6.77	-0.37%	7.49	-0.24%
Government Loans
30-Year Fixed FHA	5.75	-0.27%	6.76	-0.27%
30-Year Fixed VA	6.03	-0.18%	6.25	-0.18%
15-Year Fixed FHA	5.25	-0.30%	6.21	-0.30%
15-Year Fixed VA	5.68	-0.16%	6.04	-0.16%

Source: Zillow Mortgage Rates, August 28, 2025

This detailed breakdown shows the variety of mortgage options and their respective rate movements. Fixed-rate loans have eased slightly with the biggest drops noted in the 15-year and ARM options, particularly the 7-year ARM loan which saw a larger decline of 0.57%. Government-backed loans remain competitive, with FHA and VA loans offering some of the lowest rates, especially on 15-year fixed terms.

Refinance Rates Today: What Borrowers Should Know

Refinancing rates also experienced a slight decline but remain relatively stable compared to purchase mortgage rates.

Refinance Program	Rate (%)	Weekly Change	APR (%)	APR Weekly Change
30-Year Fixed Refinance	6.83	-0.05%	—	—
15-Year Fixed Refinance	5.61	0.00%	—	—
5-Year ARM Refinance	7.32	0.00%	—	—

Even though the refinance rate stayed mostly stable, the 5-basis-point drop in the 30-year fixed refinance rate is encouraging for homeowners. The 5-year ARM refinance rate remains the highest at 7.32%, reflecting the general upward pressure on adjustable loan rates. Homeowners should monitor these rates closely, especially as a rate cut by the Fed could make refinancing more attractive in the coming weeks.

What Does the Federal Reserve Mean for Mortgage Rates in 2025?

The Federal Reserve's monetary policy is the single largest influence on mortgage rates. The Fed’s aggressive rate hikes in 2022 and early 2023 pushed mortgage rates higher, reflecting broader economic conditions.

By late 2024, the Fed shifted gears, lowering rates three times by a total of 1% in an attempt to stimulate slowing growth. The Fed then held rates steady through much of 2025 amidst mixed economic signals:

• Inflation remains above the target, but is easing.
• Employment data shows slowing job growth and a slight uptick in unemployment to 4.2%.
• The market now overwhelmingly expects a rate cut in September 2025 to kick-start economic momentum.

Analysts point out that if the Fed follows through with this anticipated cut, mortgage rates could fall toward or even below 6% before year-end. Still, it is crucial to remember that uncertainties remain—unexpected inflation or strong jobs data could delay or reduce the size of any cut.

Mortgage Rate Forecasts and Market Expectations

Various industry leaders have shared their forecasts for mortgage rates in late 2025 and beyond:

Institution	Rate Projection 2025	Rate Projection 2026	Commentary
National Association of REALTORS®	6.4% (H2 2025)	6.1%	Rate cuts expected; rates seen as key to affordability and demand
Realtor.com	~6.4% year-end 2025	—	Slow easing expected; rates steady matching prior years
Fannie Mae	6.5% (end of 2025)	6.1%	Slight upward revision in forecasts; mortgage originations rising
Mortgage Bankers Association	~6.7% (end of 2025)	6.3%	Rates stable in mid-6% range; inflation concerns persist

Consistent across these projections is the consensus that rates will mostly remain above 6% through 2025, with moderate easing in 2026 as inflationary pressures subside. The dynamics of monetary policy, labor markets, and inflation will continue to shape the rate environment going forward.

How Do These Rates Affect Homebuyers and Refinancers?

While mortgage rates remain historically high compared to the pandemic-era lows, the recent drops and forecasted Federal Reserve cuts suggest the market is at a crossroads. Buyers might find opportunities if the anticipated rate cuts push borrowing costs lower in upcoming months. Refinancers holding loans above 7% should watch closely, as refinancing could become more economical.

For some perspective, consider an example:

• A 30-year fixed mortgage of $300,000 with a current rate of 6.52% results in a monthly principal and interest payment of about $1,895.
• If rates fall to 6.0%, the same loan monthly payment drops to roughly $1,799, saving nearly $96 per month or $1,152 annually.

Such savings underscore why small basis point changes in rates matter a great deal when taking on a new mortgage or refinancing an existing one.

Final Thoughts on Mortgage Rates Today – August 28, 2025

Today’s mortgage and refinance rates are falling slowly but steadily after a prolonged period of elevated borrowing costs. The data from Zillow and the broader economic context suggest that we may see more lasting declines if the Federal Reserve cuts rates in September as widely expected. Long-term projections point to a future where rates will gradually ease but likely remain above 6% until mid-2026 or later.

Given this environment, understanding these subtle shifts, market predictions, and the Fed’s actions can help borrowers make more informed decisions aligned with their financial goals.