Here's What You Should Know 

What Makes Mortgage Rates Go Up or Down? Here's What You Should Know 

Here’s a quick overview of what actually drives mortgage rate changes: 

1. The Federal Reserve (a.k.a. “The Fed”) 
   While the Fed doesn’t directly set mortgage rates, its policies play a major role. When inflation is high, the Fed often raises the federal funds rate to slow spending—this can lead to higher mortgage rates. If inflation cools, the Fed may lower rates, which can ease mortgage costs. 

2. Inflation 
   Mortgage lenders pay close attention to inflation. Why? Because inflation reduces the future value of the money they’re lending. If inflation is rising, lenders typically increase interest rates to protect their investments. 

3. The Bond Market 
   Mortgage rates tend to follow the yield on 10-year U.S. Treasury bonds. When bond yields rise, mortgage rates usually follow. When yields drop, mortgage rates often decrease too. 

4. The Overall Economy 
   Economic indicators like employment numbers, GDP growth, and consumer spending all impact investor confidence—and that affects mortgage rates. A strong economy often leads to higher rates, while a weaker economy can push rates lower. 

5. Global Events 
   Yes, even things happening halfway around the world—such as geopolitical conflict or financial instability—can impact U.S. mortgage rates. Global uncertainty often causes investors to shift to safer investments like U.S. bonds, which can lower mortgage rates. 

Why It Matters to You 

Mortgage interest rates play a big role in your monthly payment and the total cost of your home over time. But here’s the good news: you don’t have to try to “time the market.” You just need to know your options—and that’s where your Employee Homeownership Program comes in. 

• Understand current rate trends and what they mean for you 

• Explore loan types and payment strategies that fit your budget 

• Get pre-approved and financially ready—whether you're planning to buy this year or next