The average U.S. 30-year fixed-rate mortgage dropped to 6.67% in the week ending August 8, 2025, marking its lowest level since early April and triggering a wave of refinancing activity. Refinance applications surged 23%, reaching a four-month high, while purchase applications inched up just 1%, according to the Mortgage Bankers Association (MBA).
What’s happening with interest rates?
- The 30-year fixed mortgage rate fell by 10 basis points to 6.67%, a level not seen since early April.
- Freddie Mac corroborated the trend, reporting the average rate dropped to 6.63% as of August 7, the lowest level in four months.
Refinancing surges, while purchases remain sluggish
- Refinance applications soared 23%, hitting a four-month peak.
- Meanwhile, purchase-related applications rose by a modest 1%, suggesting buyers remain hesitant despite lower rates.
Why the dip—and will it last?
- The rate decline appears tied to a softer-than-expected job market, which has increased expectations that the Federal Reserve might reduce interest rates in September.
- Current Fed officials have left short-term rates steady amid inflation concerns, though several have hinted at openness to rate cuts.
- Note: Mortgage rates tend to follow movements in the 10-year Treasury yield more closely than direct Fed rate moves.
Summary Table
| Metric | Value / Trend |
|---|---|
| 30-Year Mortgage Rate | Fell to 6.67% (week of Aug 8) |
| Refinance Applications | Jumped 23%, four-month high |
| Purchase Applications | Up 1%, showing buyer caution |
| Rate Decline Driver | Weak job data, speculation around Fed action |
TL;DR
- Mortgage rates for 30-year loans fell to their lowest since April, at around 6.67%.
- Homeowners rushing to refinance led to a 23% spike in activity, but buyers aren’t rushing in.
- The dip stems from worries about the labor market and rising bets on a Fed rate cut in September.
- While encouraging, economists caution the decline may be temporary.
Marc has been involved in the Stock Market Media Industry for the last +5 years. After obtaining a college degree in engineering in France, he moved to Canada, where he created Money,eh?, a personal finance website.
