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Tim Maxwell is a freelance writer covering investing, real estate, banking, credit education and other personal finance topics.
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Mortgage rates have fluctuated greatly over the past year and were particularly volatile from late 2025 through the first half of 2026. Case in point? The average 30-year fixed rate fell to 5.98% at the end of February 2026, then rose again to 6.53% by the end of May. And mortgage rates are now hovering around 6.5% as of mid-July.
If you’re hoping for further cuts in these rates, you can assume that a potential rate cut will largely depend on what the Federal Reserve does next. But while the Fed’s rate changes affect borrowing costs, the central bank does not directly set mortgage rates. And with the Fed expected to keep its benchmark rate on pause this summer or perhaps even raise it, many potential buyers are wondering whether without a Fed rate cut.
To get a sense of where things are heading, we asked several mortgage and housing experts whether mortgage rates could fall without Fed action and what factors are influencing rates right now. That’s what they said.
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Could mortgage rates fall without the Fed cutting rates? What the experts say
The short answer: Yes, mortgage rates could fall—but they could also rise or stay the same—regardless of the Fed’s rate decisions, experts say.
“The Fed never touched rates in 2026, and 30-year mortgages were still moving half a point back and forth. This is all the evidence needed that mortgage rates are not waiting for the Fed,” says former Wall Street capital markets strategist Anupam Satyasheel, founder and CEO of Occams Advisory.
One of the main reasons mortgage rates could change is that fixed-rate mortgages more directly track the 10-year Treasury yield rather than reflecting the Fed’s policy rate.
“Your 30-year quote is based on the 10-year Treasury note, and the 10-year quote is essentially the market’s live consensus forecast of the entire trajectory of Fed policy and inflation over the next decade,” Satyasheel says.
When investors expect inflation to begin to decline, the 10-year Treasury yield could fall. Because mortgage rates often move along with these yields, these rates could also fall, even without the Fed cutting rates.
This doesn’t mean the Fed doesn’t influence mortgage rates. Yes, but the influence is indirect. The Federal Reserve sets the federal funds rate, and banks use short-term rates to charge each other for overnight loans. This helps set the rate you pay on things like personal loans, credit cards, auto loans and home equity lines, and mortgages often move in the same direction as the federal funds rate.
Of course, there are exceptions, such as when the Fed cut rates three times at the end of 2024 and mortgage rates rose instead.
“Mortgage rates could fall regardless of the Fed cutting rates for several reasons,” says Jeremy Schachter, branch manager at Fairway Independent Mortgage Corporation.
He points out that Fannie Mae and Freddie Mac purchased $200 billion in mortgage-backed securities in early 2026, briefly driving down mortgage rates.
“This purchase immediately lowered rates. Perhaps he could do it again, which would lead to lower interest rates,” says Schachter.
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What factors are influencing mortgage rates right now?
Many experts say that inflation is the main factor keeping mortgage rates high today. According to the latest report, inflation rose to 4.2%, well above the Fed’s target of 2%. Electricity costs alone jumped 23.5% as the conflict with Iran drove up fuel prices, according to the Bureau of Labor Statistics.
“Inflation is the main culprit as to why mortgage rates did not fall further during the year. If consumer spending declines, as we are seeing with gasoline prices, rates could also drop slightly this summer,” Schachter says.
Fed Chairman Kevin Warsh said the central bank is unlikely to cut rates this year as long as inflation remains high.
Another factor currently affecting mortgage rates is the gap between mortgage rates and the 10-year Treasury yield. When you take out a mortgage, your lender generally will not hold it. Instead, the loan is usually sold to investors and the money can be used to fund the next loan.
Instead, these investors may prefer to put their money into safe government bonds, so that they only buy a mortgage if it pays them more than the 10-year Treasury. This difference is known as the spread, and it is the main factor that helps set your mortgage rate. When this spread widens, mortgage rates typically rise as well.
“There are two independent paths to lower mortgage rates that require nothing from the Fed: cooler inflation data, which would likely pull the 10-year down, and calmer bond markets, which would tighten that spread,” Satyasheel says.
What to do if you’re waiting for mortgage rates to drop
Experts often caution against waiting for mortgage rates to fall, largely because home prices could rise while you wait, negating the benefits of lower mortgage rates.
“The timing of the bet is the bet, not the plan, and most people lose that bet by waiting too long,” says Jeff Judge, a certified financial planner at Chesapeake Financial Planners.
Judge had a client last year who wanted to wait for another half-point cut in mortgage rates before buying. He crunched the numbers and saw that home prices in the client’s market were rising rapidly, which would have negated the savings from a lower rate. The client bought a home and then refinanced eight months later when rates dropped.
If you find the right home, waiting for a small drop in rates could be costly.
After all, “a mortgage can be refinanced. A lost home, especially in a market where inventory is limited, typically cannot be recovered at the same price,” says Judge.
Waiting only makes sense if you really can’t afford the payment now, Judge says, or you’re waiting for something specific, like a bonus or a house deal.
What really matters is that you can comfortably cover your mortgage and all of your home-related expenses. This should still leave room for an emergency fund, saving for retirement, and paying other bills without leaving you home poor.
“The lender gives you the right to get the loan,” Judge says. “I’m looking to see if credit still allows you to finance your real life.”
Bottom line
If you’re waiting for mortgage rates to fall, don’t focus solely on the Federal Reserve’s expectations. The Fed’s rate does affect rates indirectly, but keep an eye on inflation as well as the 10-year Treasury yield, which could move mortgage rates even if the Fed leaves rates unchanged.
It’s also wise to look for ways within your control to get a lower mortgage rate. For example, visiting several lenders can help you find the best terms available. Strengthening your credit, making a larger down payment or purchasing mortgage points can also lower your rate.
Edited by Angelika Leicht