Today’s Mortgage Rates – August 30, 2025: 30-Year FRM Plummets by 14 Basis Points

As of August 30, 2025, mortgage rates have notably dropped, with the national average 30-year fixed mortgage rate falling to 6.53%, down 14 basis points from last week’s 6.67% and hitting a 10-month low, according to data from Zillow. Refinance rates have also experienced a slight decline, with the 30-year fixed refinance rate dropping to 6.82%.

Lower mortgage and refinance rates can improve affordability and may encourage some buyers to enter the housing market. Thus, today’s mortgage rates are lower compared to recent weeks, signaling a potential opportunity for homebuyers and refinancers to lock in favorable rates ahead of expected Federal Reserve interest rate decisions.

Today's Mortgage Rates – August 30, 2025: 30-Year FRM Plummets by 14 Basis Points

Key Takeaways

• 30-year fixed mortgage rate dropped to 6.53%, a 10-month low.
• Refinance rates also fell, with the 30-year fixed refinance rate at 6.82%.
• The Federal Reserve is widely expected to cut interest rates in September 2025; this could push mortgage rates lower soon.
• Despite the recent drop, mortgage rates remain above 6%, with projections estimating rates will stay elevated through 2025 and ease slowly into 2026.
• Purchase demand is rising as lower rates improve buyer affordability despite ongoing challenges.
• Government loan rates (FHA and VA) also declined but remained competitive.
• Long-term outlook suggests mortgage rates around 6.1% by 2026 but not below until at least Q3 2026.

Mortgage Rates Overview – August 30, 2025

Mortgage rates in the U.S. have seen a meaningful pullback this week, marking a trend downward after a period of relative stability. Zillow’s latest figures reveal:

Loan Type	Rate (%)	Change From 1 Week Ago	APR (%)	APR Change 1 Week Ago
30-Year Fixed	6.53	↓ 0.14	6.95	↓ 0.17
20-Year Fixed	6.31	↓ 0.12	6.71	↓ 0.21
15-Year Fixed	5.64	↓ 0.13	5.92	↓ 0.14
10-Year Fixed	5.79	0.00	6.09	0.00
7-Year ARM	7.04	↓ 0.15	7.70	↓ 0.04
5-Year ARM	6.83	↓ 0.30	7.54	↓ 0.20

Government Loans (FHA & VA)*

Program	Rate (%)	Change 1 Week Ago	APR (%)	APR Change 1 Week Ago
30-Year Fixed FHA	5.96	↓ 0.06	6.96	↓ 0.07
30-Year Fixed VA	6.18	↓ 0.03	6.43	↑ 0.01
15-Year Fixed FHA	5.50	↓ 0.05	6.46	↓ 0.05
15-Year Fixed VA	5.74	↓ 0.10	6.16	↓ 0.04

Source: Zillow – August 30, 2025

Refinance Rates Also Decline Slightly

Refinancing has become more attractive as rates come down, though they remain relatively elevated. The current national average 30-year fixed refinance rate decreased to 6.82%, down 3 basis points from last week’s 6.85%. The 15-year fixed refinance rate edged up slightly to 5.61%, and the 5-year ARM refinance rate held steady at 7.28%.

Refinance Type	Rate (%)	Change From 1 Week Ago
30-Year Fixed Refinance	6.82	↓ 0.03
15-Year Fixed Refinance	5.61	↑ 0.02
5-Year ARM Refinance	7.28	0.00

Why Are Mortgage Rates Falling? The Fed and Economic Overview

Mortgage rates are closely tied to the broader economic landscape and the Federal Reserve's interest rate policies. After a long series of hikes between 2022 and mid-2023, the Fed has paused and is expected to cut rates soon.

• The Fed raised rates aggressively from March 2022 to July 2023 to combat inflation, pushing mortgage rates to 20-year highs above 7%.
• Since late 2024, rate cuts totaling 1% have been made, with the current Federal Funds rate at 4.25%-4.5%.
• As of mid-2025, rates have been steady, but weak job growth and cooling inflation indicate a September 2025 Fed rate cut is likely (with 89-91% market expectation).
• This expected cut could drive mortgage rates down further in the coming months.

This alignment of economic indicators—sticky but moderating inflation, cooling job growth, and rising unemployment—signals that borrowing costs may continue easing, presenting opportunities for buyers and refinancers.

Impact on Buyers and Market Dynamics

The lower rates have already sparked increased purchase demand as buyers take advantage of improving affordability. However, affordability challenges remain due to still high prices and other factors.

Experts like those at Fannie Mae project that despite recent drops, mortgage rates will generally remain above 6% until at least Q3 2026, with forecasted rates around 6.5% by year-end 2025 and falling gradually thereafter.

Forecast Source	Expected 2025 Year-End Rate (%)	Expected 2026 Rate (%)
Fannie Mae (July 2025)	6.5	6.1
Realtor.com (August 2025)	6.4	–
Mortgage Bankers Assoc.	~6.7	~6.3

Breaking Down an Example: How Rate Changes Affect Payments

Let’s imagine a buyer considering a $350,000 home loan over 30 years.

Rate Scenario	Monthly Principal & Interest Payment
At 6.67% (Last Week)	$2,240
At 6.53% (Today)	$2,218
At 6.30% (Projected)	$2,155 (Estimated)

This $0.14 percentage point drop to 6.53% saves about $22 a month, or roughly $260 a year. Further declines could lead to even more savings, especially for those considering refinancing.

The Role of Adjustable-Rate Mortgages (ARMs) in Today’s Market

While fixed rates have been the focus, adjustable-rate mortgages show mixed trends:

• The 5-year ARM rate dropped notably by 30 basis points to 6.83%.
• The 7-year ARM also decreased by 15 basis points to 7.04%.
• ARMs can offer lower initial payments but come with rate reset risk.

Borrowers considering ARMs should closely watch rate trends and Fed signals, as any uptick in inflation or Fed policy shifts could impact future adjustments.

Federal Reserve’s Influence: Looking Ahead

The Fed’s September 16-17 meeting is pivotal. Expectations are high for the first rate cut of the year. Fed Chair Jerome Powell’s speech at Jackson Hole on August 22 will be analyzed for clues.

• The Fed's “dot plot” earlier predicted two cuts in 2025, starting this September.
• A rate cut could push mortgage rates closer to or just below 6% by year-end.
• Any surprises in economic data (inflation or employment) could adjust these expectations.

Mortgage Rates and Broader Economic Implications

Mortgage rates impact more than homebuyers. Lower rates generally:

• Boost consumer spending by lowering debt servicing costs.
• Spur business investment due to cheaper financing.
• Influence stock and bond markets, especially Treasury yields.

Currently, bond yields sit around 4.23% for the 10-year Treasury, sensitive to Fed signals.

Summary Table: August 30, 2025 Mortgage & Refinance Rate Highlights

Category	Current Rate (%)	Change This Week	Notes
30-year Fixed Mortgage	6.53	↓ 0.14	10-month low
15-year Fixed Mortgage	5.64	↓ 0.13	Stable compared to last week
5-year ARM Mortgage	6.83	↓ 0.30	Largest drop; more volatile rate
30-year Fixed Refinance	6.82	↓ 0.03	Slight decline
15-year Fixed Refinance	5.61	↑ 0.02	Small increase

Mortgage rates are now lower than they were just a week ago, influenced mainly by economic data signaling weakening job growth and persistent but slowing inflation. A Federal Reserve rate cut expected in September 2025 is the key event that could push mortgage rates down further, helping homebuyers and refinancers alike. While rates remain higher than the lows seen earlier in the decade, the downward trend provides some hope for improved affordability over the next year.