What is the mortgage rate forecast for fall 2026?

We may receive commissions from some links to products on this page. Promotions are subject to availability and retailer terms. By Aly J. Yale is a contributing writer for the Managing Your Money section for CBSNews.com, covering various personal finance topics, including investing, homebuying, loans and more. Read Full Bio July 29, 2026 / 8:35 AM EDT / CBS News Add CBS News on Google Borrowers searching for affordable mortgage interest rates may encounter a different rate climate this fall. Kenstocker/Getty Images Mortgage interest rates have been in the mid-6% range for much of 2026, and recently, they've jumped even higher. According to Zillow, the average rate on 30-year conventional loans is now at 6.75%, around a full point higher than where it sat in March."Mortgage rates recently reached some of their highest levels of 2026, as renewed conflict between the U.S. and Iran pushed oil prices higher and reignited inflation concerns," says Jeff DerGurahian, head economist at mortgage lender loanDepot. This is a marked change compared to the spring and even most of 2025, when the average rate dropped by around a full percentage point, encouraged by multiple Federal Reserve interest rate cuts in the final months of the year.Will rates stay this high, though, or is there a real possibility for rates to start dropping again this fall? We asked DerGurahian and other experts for their predictions for where mortgage rates could head in the season. Below, we'll examine their predictions.Start by seeing how low a mortgage rate you'd be eligible for here.What is the mortgage rate forecast for fall 2026?The most likely scenario is that rates either stay put in the mid- to high-6% range or increase slightly. Both Fannie Mae and the Mortgage Bankers Association's latest forecasts have rates unchanged for the rest of 2026 (MBA's actually has rates holding steady through next year, too). "Inflation has remained elevated and the Iran conflict continues to drag on, which are key factors keeping rates from dropping," says John Ortega, a senior home loan specialist at Churchill Mortgage. "I am actually surprised oil hasn't gone to higher levels, but my gut tells me that could be coming in the near future."Should those higher oil prices come, DerGurahian says it could "put upward pressure on rates." "If the conflict between the U.S. and Iran continues with no clear resolution in sight, energy prices remain elevated or move even higher, and the labor market continues to show signs of strength, mortgage rates could creep higher this fall," DerGurahian says. Rising oil prices could also push up inflation, which may force the Federal Reserve's hand and necessitate a rate hike. While the Fed is just a single driver behind mortgage rates, it remains a critical one. According to the CME Group's FedWatch tool, there's currently about a 75% chance of a rate hike at the Fed's September meeting.Consider locking a mortgage rate before they rise again here.How can mortgage rates drop this fall?There's always the chance that rates could fall, but certain conditions would have to align for that to happen. "For mortgage rates to drop, we would need to see any combination of these factors coming into play — inflation continuing to cool, the labor market to slow down, or lower 10-year Treasury yields driving investors to seek safety," Ortega says. If that were to happen, experts say it would likely only result in a slight decrease in rates. And it may not be this fall. According to Fannie Mae's forecasts, the rate drop (a reduction of just 0.1%) will happen in 2027. "I still foresee slightly lower rates on the horizon, but that will likely be pushed out to 2027 based on current forecasts," says Andrew Marquis, senior vice president at CrossCountry Mortgage. A more notable decline, he says, would require a "firm resolution to the Iran conflict and a dramatic drop in inflation."While inflation did drop last month to 3.5%, down from 4.2% the previous month, it's still much higher than the Fed's ultimate goal. The central bank aims for a 2% inflation rate for a healthy economy.The bottom lineThough it's largely expected that rates will remain high for the rest of the year, nothing is set in stone. Experts say to watch the data and monitor Fed and inflation moves for a good idea of where rates may be headed."For a window into where mortgage rates are headed, keep an eye on employment growth, unemployment claims, and whether the economy is cooling enough to put pressure on rates," Ortega says. "I can't emphasize enough the importance of inflation reports in this equation, as they are the most important driver of mortgage rates with their influence on bond yields and Fed policy."And if rates do stay high (or even move higher), experts say you can still make buying a home affordable — it just takes some creativity. "There are strategies that can improve affordability in today's higher-rate environment," Marquis says. "Options such as adjustable-rate mortgages, temporary rate buydowns, down payment assistance programs, seller concessions, or choosing a home at a slightly lower price point can help reduce monthly payments." Edited by Matt Richardson