Mortgage rates fall to 6.13% — $400,000 loan now costs $2,431.74/month (PI)
30-year mortgage rates have dropped to about 6.13% — the lowest since 2022 — as 10‑year Treasury yields fell and markets priced in a 25–50 basis‑point Fed cut. The move has triggered a surge in purchase and refinance activity (Freddie Mac and the MBA report strong year‑over‑year gains and refis nearly half of applications, with MBA noting a 59.8% week‑over‑week jump in refi apps), and a $400,000, 30‑year fixed at 6.13% carries a principal‑and‑interest payment of $2,431.74 (about $240/month less than at January’s 7.04% and about $445/month less than at October’s 7.79%).
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🔍 Key Facts
- 30‑year fixed mortgage rates have moved lower in September: Freddie Mac reported a drop to 6.35% (from 6.50%, the lowest since Oct. 2024) and Mortgage News Daily reported an average of 6.13% (a three‑year low, the lowest since 2022).
- The decline is tied to falling 10‑year Treasury yields (around 4%) and markets pricing in an imminent Federal Reserve cut (market expectations ranged roughly 25–50 basis points); markets often move ahead of Fed decisions, so further mortgage rate drops are not guaranteed even after an official cut.
- Borrower demand has surged: MBA and Mortgage Bankers Association data show both purchase and refinance applications rising week‑over‑week and year‑over‑year (purchase apps at their highest since July; refis accounted for nearly half of applications), with refinance applications up as much as 59.8% week‑over‑week for the week ending Sept. 12 and average refinance loan sizes at record highs; Freddie Mac said purchase app year‑over‑year growth is the strongest in more than four years.
- Economic context driving markets includes softer labor data (August payrolls +22,000 and a BLS revision that overstated prior hiring by about 911,000) and still‑elevated inflation (2.9% year‑over‑year in August).
- Concrete payment examples at the 6.13% rate (principal & interest only): $250,000 → $1,519.83/month; $300,000 → $1,823.80/month; $400,000 → $2,431.74/month. For a $400,000 loan this is about $240/month less than at 7.04% (Jan. 2025) and about $445/month less than at 7.79% (Oct. 2024).
- Lifetime and refinance illustrations: a $250,000 loan at the lower rate was shown to save roughly $54,000 in interest over 30 years; a $300,000 loan yields roughly $65,000 in lifetime savings versus Jan. 2025 rates and roughly $120,000 versus Oct. 2024 rates. A 15‑year refinance example cited: for $250,000 at ~5.98% the P&I would be about $2,106.94 (illustrating payoff vs. monthly‑cost tradeoffs).
- How rates move and consumer advice: fixed mortgage rates generally track long‑term bond yields (especially the 10‑year Treasury) while adjustable rates follow short‑term indexes like SOFR; analysts note bond markets price anticipated Fed moves. Coverage advised borrowers to weigh timing, credit score improvement, pre‑approval, and refinance strategy rather than assuming rates will fall further.
📰 Sources (9)
Here's how much a $300,000 mortgage costs monthly now that the Fed cut interest rates
New information:
- Calculation that a $300,000, 30-year fixed mortgage at 6.13% costs $1,823.80 per month in principal and interest.
- Comparison to earlier averages: January 2025 (7.04% → $2,003.97/month) and October 2024 (7.79% → $2,157.54/month).
- Explicit dollar savings quantified: roughly $180/month versus January 2025 (about $2,160/year; nearly $65,000 over 30 years) and about $334/month versus October 2024 (about $120,000 over 30 years).
- Discussion that the Fed cut spurred higher purchase and refinance application activity and that the article frames savings both monthly and over the life of the loan.
What are the monthly payments on a $400,000 mortgage after the Fed's rate cut?
New information:
- Principal-and-interest monthly payment on a $400,000, 30-year fixed mortgage at 6.13%: $2,431.74.
- Comparison figures: at 7.04% (Jan 2025) the payment would have been $2,671.96; at 7.79% (Oct 2024) it would have been $2,876.71.
- Estimated monthly savings versus January 2025: about $240/month (≈ $2,882/year); versus October 2024 peak rates: about $445/month (≈ $5,340/year).
- Refinance example: 15-year refinance at 5.98% produces a principal-and-interest payment of $3,371.11 per month.
What would the monthly payments be on a $250,000 mortgage now that the Fed has cut rates?
New information:
- Monthly principal & interest payment for a $250,000, 30‑year mortgage at 6.13% is $1,519.83.
- Comparison math: at a 7.04% rate (early January average) the same loan would have been $1,669.98 — about $150 more per month.
- Estimated lifetime interest savings from the lower rate: roughly $54,000 over 30 years.
- Refinance example: a 15‑year refi at 5.98% would carry a $2,106.94 monthly P&I payment (illustrating payoff/interest tradeoffs).
Mortgage refinancing demand surges. Here's who can benefit now.
New information:
- MBA reports refinance applications rose 59.8% week-over-week for the week ending Sept. 12.
- Average refinancing loan amount is now at a record high, per the article’s summary of recent data.
- Reiterates the 30-year fixed average at 6.13% (lowest since 2022) and ties the move to a dip in Treasury yields and expectations of a Fed rate cut.
Mortgage interest rates just fell to a 3-year low. Here's why (and what to do now).
New information:
- Average 30-year fixed mortgage rate is 6.13% per Mortgage News Daily, the lowest since 2022 (three-year low).
- The drop is linked to falling 10-year Treasury yields and markets anticipating a 25–50 bps Fed cut at today's meeting.
- MBA’s seasonally adjusted index shows both purchase and refinance applications have surged alongside the rate decline.
How the Federal Reserve decision could influence mortgage rates
New information:
- Provides the latest 15-year fixed mortgage average at 5.5%, down from 5.6% last week and 5.27% a year ago.
- Explains that fixed mortgage rates track long-term bonds, especially the 10-year Treasury, while ARMs are tied to SOFR.
- Quotes from Realtor.com’s Jake Krimmel and Bankrate’s Stephen Kates on investor expectations and how bond markets price anticipated Fed moves.
- Notes the 10-year Treasury yield was about 4% on Thursday afternoon.
- Cites a historical example: mortgage rates fell ahead of an unusually large 0.50-point Fed cut in Sept. 2024, underscoring that markets often move before official decisions.
Want to buy a home now? Don't forget these 4 things.
New information:
- CBS frames the current decline as bringing mortgage rates to their lowest level in roughly 11 months and notes another weekly drop this week.
- Mentions there is a "small but substantial" chance the Fed could cut by 50 basis points next week (not just 25 bps).
- Reiterates MBA’s Sept. 10 note that mortgage applications jumped nearly 10% in one week.
- Adds contextual analysis that last September rates plunged before a Fed cut and then rose in the weeks and months after, suggesting timing considerations for buyers.
- Mortgage rates at their lowest in ~11 months after consecutive weekly declines.
- MBA reported nearly a 10% week-over-week jump in applications as of Sept. 10.
- Speculation of a larger‑than‑expected 50 bps Fed cut next week.
- Advises buyers on timing, credit scores, pre‑approval, and refinancing strategy.
3 mortgage interest rate questions to ask now
New information:
- Average 30-year mortgage rate around 6.35%, near one-year low
- Decline tied to Fed cut expectations and lower 10-year Treasury yield
Home mortgage demand surges as rates drop to 6.35%
New information:
- Average 30-year fixed mortgage rate fell to 6.35% from 6.5% week-over-week, the lowest since October 2024 and the biggest weekly drop in the past year (Freddie Mac).
- Freddie Mac’s Sam Khater says purchase applications hit their highest year-over-year growth rate in more than four years.
- Mortgage Bankers Association data: both purchase and refinance applications rose week-over-week and year-over-year; refinances made up nearly half of applications; purchase apps reached their highest level since July.
- Context drivers: weakening labor data (August payrolls +22,000; BLS revision shows hiring overstated by 911,000), and inflation at 2.9% YoY in August.
- The Fed is expected to cut rates next week, but markets may have already priced it in, so mortgage rates may not fall further solely due to that move.
- 30-year average: 6.35% (down from 6.5%)—lowest since Oct 2024.
- Refis nearly 50% of all applications; purchase apps highest since July.
- August jobs +22,000; BLS says prior-year hiring overstated by 911,000.