Dramatic Drop in Mortgage Rates

Every once in a while I send out a “Newsflash" email when mortgage rates sharply drop. 

This happens to be one of those fortunate occasions; this past Friday, mortgage rates suddenly and dramatically dropped to a 3-year low. 

Mortgage rates are driven by the The Relationship Between Mortgage Bonds and Mortgage Rates, as I discussed in an earlier article. Lenders price mortgages by anticipating the market, based on news that they believe will affect the demand for Mortgage Bonds in the future. Some news about anticipated Mortgage Bond demand hit the markets this past Friday and caused an immediate drop in mortgage prices. 

We don’t know how long these lower rates will last, but I personally believe they could last at least a few weeks. 

If you’ve been thinking about making your move, this is good news for you! 

As of this writing, “conventional” (i.e. W2 tax return) 30-year mortgage loans are currently available at a rate between about 5.2 - 5.5%, and 15-year mortgages are going for about 4.6 - 4.8%. 

If you are self-employed and have been in business for over 5 years, we only need one year of tax returns to prove your income to the lender. That means that if you had a good year in 2024, you can apply right now using your 2024 tax return. If you had a better year in 2025, the earliest time the IRS will accept federal tax filings is Monday January 26. 

If you cannot show your income through tax returns (which applies to many of our clients), 30-year bank statement loans are currently available at a rate of about 6.375 - 6.5%.  

There are other ways of qualifying too, each with their own set of rates. 

If you need help or would like to run through a scenario, feel free to call me, email me or schedule an appointment here.  

Hoping your 2026 has been off to a good start so far.