Mortgage Interest Rates Today: Rates Drop to 6.15%—the Lowest Level of 2025

Mortgage rates ticked down Wednesday in the final hours of 2025 after Treasury yields eased amid relatively calm market conditions during the festive season.

The average rate on 30-year fixed home loans decreased to 6.15% for the week ending Dec. 31, down from 6.18% the week before, according to Freddie Mac. This marks the lowest mortgage rate for 2025. For perspective, rates averaged 6.91% during the same period in 2024.

"After starting the year close to 7%, the average 30-year fixed-rate mortgage moved to its lowest level in 2025 this week, an encouraging sign for potential homebuyers heading into the new year," said Sam Khater, Freddie Mac’s chief economist. 

Holiday trading saw the yield on the 10-year Treasury note soften, offering mortgage rates, which closely track the benchmark, some breathing room to close out the year.  

“There is little indication that the Federal Reserve will make any major changes to interest rates in January, and the market is responding favorably to a period of relative stability,” says Realtor.com® senior economist Joel Berner.  

The Federal Open Market Committee (FOMC) will meet next on Jan. 27-28, 2026, but financial markets currently put the probability of another rate cut at just 16%, according to CME FedWatch.

The Fed’s increasingly divided policymakers reduced the benchmark interest rate three times in 2025, each by a quarter of a point, lowering it to a 3.5%-3.75% range as of December, but the housing market remained constrained.

“Affordability was the primary constraint on the housing market in 2025, with mortgage rates clocking in the mid-6% range for most of the year and home prices remaining elevated, which kept many buyers on the sidelines,” says Berner. 

However, the second half of the year saw mortgage rates retreat in a meaningful way, signaling that 2026 could be a year of rebound for the housing market. 

“If this momentum continues into the peak buying season of 2026, we could see much stronger sales figures than we saw for much of 2025,” says Berner. “Already, pending home sales have responded to the relief from mortgage rates and are helping the market to pick up steam through what is traditionally the slowest part of the year."

How mortgage rates are calculated

Mortgage rates are determined by a delicate calculus that factors in the state of the economy and an individual’s financial health. They are most closely linked to the 10-year Treasury bond yield, which reflects broader market trends, like economic growth and inflation expectations. Lenders reference this benchmark before adding their own margin to cover operational costs, risks, and profit.

When the economy flashes warning signs of rising inflation, Treasury yields typically increase, prompting mortgage rates to go up. Conversely, signs of falling inflation or weakness in the labor market usually send Treasury yields lower, causing mortgage rates to fall.

The mortgage rates you’re offered by a lender, however, go beyond these benchmarks and take some of your personal factors into account.

Your lender will closely scrutinize your financial health—including your credit score, loan amount, property type, size of down payment, and loan term—to determine your risk. Those with stronger financial profiles are deemed as lower risk and typically receive lower rates, while borrowers perceived as higher risk get higher rates.

How your credit score affects your mortgage

Your credit score plays a role when you apply for a mortgage. A credit score will determine whether you qualify for a mortgage and the interest rate you'll receive. The higher the credit score, the lower the interest rate you'll qualify for.

The credit score you need will vary depending on the type of loan. A score of 620 is a "fair" rating. However, people applying for a Federal Housing Administration loan might be able to get approved with a credit score of 500, which is considered a low score.

Homebuyers with credit scores of 740 or higher are typically considered to be in very good standing and can usually qualify for better rates.

Different types of mortgage loan programs have their own minimum credit score requirements. Some lenders have stricter criteria when evaluating whether to approve a loan. They want to make sure you're able to pay back the loan.