Category: Mortgage Interest Rates

What’s Really Moving Mortgage Rates Right Now? A Clear Look at the Forces Pushing Up—and Pulling Down

If you’ve been watching mortgage rates lately and wondering, “Why do they seem so unpredictable?” — you’re not alone.

Behind the scenes, investors in the mortgage-backed securities (MBS) market are constantly adjusting expectations. Most recently, we’ve seen a meaningful shift: the probability of a March 2026 Fed rate cut has dropped by more than 10% since Friday.

The primary driver? Rising geopolitical tensions in the Middle East.

But that’s only part of the story.

There are several powerful economic forces applying both upward and downward pressure on mortgage rates — in the short term and the long term. Let’s break this down clearly and logically so you can understand what’s happening and why it matters for you.

1. Iran & Oil Prices (Primary Driver Right Now)

Energy prices influence nearly everything in our economy — transportation, manufacturing, food production, and more.

Short Term Impact

Prolonged high oil prices → Higher inflation expectations → Higher mortgage rates

When energy prices rise, investors anticipate broader inflation. Since inflation erodes the value of bonds (including mortgage-backed securities), rates tend to move higher to compensate.

Long Term Impact

Higher production costs → Sustained inflation → Potential stagflation → Ambiguous rate impact

If inflation remains elevated while economic growth slows, we could face stagflation — a difficult environment where rates don’t have a clear direction. In that scenario, mortgage rates could become more volatile.

2. Pessimistic U.S. Employment Figures

The labor market has been one of the strongest pillars of the economy. When employment weakens, the impact is significant.

Short Term Impact

Worsening employment outlook → Slower economy → Lower mortgage rates

If job growth softens, it reduces inflation pressure. Investors often move money into bonds during uncertain economic periods, which pushes mortgage rates down.

Long Term Impact

Employment crisis → Fed intervention → Lower mortgage rates

If unemployment rises meaningfully, the Federal Reserve would likely cut rates to stimulate the economy — which would typically benefit mortgage rates.

3. Potential Hawkish Fed Leadership (Kevin Warsh)

Markets are also evaluating the possibility that Kevin Warsh could become the next Fed Chair — and he is widely considered hawkish on inflation.

Short Term Impact

“Hawkish” leadership expectations → Rates stay higher for longer → Higher mortgage rates

If investors believe the Fed will prioritize fighting inflation aggressively, they anticipate fewer rate cuts — keeping mortgage rates elevated.

Long Term Impact

Reduced inflation expectations → Stabilized economy → Lower mortgage rates

If strong anti-inflation policy succeeds, inflation expectations fall. Lower inflation expectations typically support lower long-term mortgage rates.

4. Sweeping Global Tariffs

Tariffs aren’t just political headlines — they affect bond supply and federal deficits.

Short Term Impact

Higher tariff revenue → Fewer Treasury bonds issued → Lower mortgage rates

When the government issues fewer Treasuries, bond supply decreases. Lower supply can support bond prices, which helps keep mortgage rates lower.

Long Term Impact

Reduced deficit → Fiscal stabilization → Ambiguous rate impact

A smaller deficit could be positive for rates, but tariffs can also increase consumer prices. The long-term outcome depends on how those forces balance out.

5. Artificial Intelligence

AI is transforming industries rapidly — and markets are paying close attention.

Short Term Impact

AI overvaluation concerns → Flight to safety → Lower mortgage rates

If investors worry about tech market corrections, they often move money into safer assets like bonds — helping mortgage rates.

Long Term Impact

Job displacement from widespread AI adoption → Slower wage growth → Lower mortgage rates

If AI meaningfully disrupts employment or wage growth, inflation pressures could ease — creating downward pressure on long-term rates.

So Where Does That Leave Us?

Right now, the dominant short-term driver is geopolitical tension and energy prices, which are pushing inflation expectations higher and reducing the probability of near-term Fed rate cuts.

At the same time, weaker employment data, AI uncertainty, and potential fiscal shifts are applying downward pressure.

In other words — we’re in a tug-of-war environment.

And in environments like this, mortgage rates can move quickly based on headlines.

What Should You Do?

Trying to “time the market” in a multi-variable environment like this is extremely difficult — even for seasoned investors.

What matters most is:

  • Your financial goals
  • Your timeline
  • Your risk tolerance
  • The right strategy for your specific scenario

With over 25 years of experience and more than 3,500 families served, I believe in making decisions based on facts — not fear, hype, or headlines. We look at the data, evaluate the risk, and build a strategy that protects you both short-term and long-term.

If you’re buying, refinancing, or just trying to understand how today’s rate environment affects your plans, let’s have a conversation.

Let’s Build a Smart Plan Together

📞 Call or text me directly at (404) 791-3155
📧 Email: chriss@fairwaymc.com
🌐 Visit: www.chrisshumatefairway.com

You don’t need to predict the market.
You just need the right strategy in the market we have.

Let’s make a confident move — together.

Top 5 Mortgage Questions Answered

By Chris Shumate, Senior Mortgage Loan Officer at Fairway Home Mortgage

📺 Watch the full video here: https://youtube.com/shorts/LWNrmvshBnE?si=kvBr1yq2aDN1pTvQ

When it comes to getting a mortgage, it’s completely normal to have questions—especially in today’s market. After helping more than 3,500 families finance their homes over the years, I’ve learned that most people share the same core concerns.

So, let’s break down the Top 5 Mortgage Questions I get asked the most—and the clear, simple answers you deserve.

1. What’s the first step to getting a mortgage?

Start with a pre-approval, not just a pre-qualification.
A pre-approval means we’ve reviewed your income, assets, and credit to determine what you truly qualify for. It gives you confidence, and it tells sellers you’re a serious buyer.

2. How much do I need for a down payment?

This is one of the biggest misconceptions. You don’t need 20% down.
Depending on the loan type, you could buy with as little as:

  • 0% down for qualified VA loans,
  • 3% down for some conventional loans, and
  • 3.5% down for FHA loans.

The right option depends on your situation—and I’ll help you find the one that fits your goals.

3. What affects my interest rate?

Mortgage rates depend on several factors: your credit score, loan type, down payment, and the overall market conditions.
Remember, the Federal Reserve doesn’t set mortgage rates directly—rates move based on investor confidence and inflation expectations. That’s why timing and strategy matter.

4. Should I buy now or wait for rates to drop?

The truth is, no one can perfectly time the market. But here’s what we do know: you can refinance later, but you can’t go back and buy the same home at today’s price.
If the home and the payment fit your budget today, that’s worth strong consideration. When rates drop, we can always look at refinancing to lower your payment.

5. How long does the process take?

At Fairway, we pride ourselves on efficiency and communication.
Once you’re under contract, we can often close your loan in as little as 15–20 business days, depending on your situation. My team handles every detail carefully to make sure you stay informed from start to finish.

Final Thoughts

Buying a home doesn’t have to be confusing or stressful. When you have the right team guiding you, every step becomes clear and manageable.

If you’re thinking about purchasing, refinancing, or just want to get pre-approved, my team and I are here to make the process smooth, transparent, and rewarding.

🏡 Let’s get your questions answered and your goals accomplished.

About the Author:
Chris Shumate is a Senior Mortgage Loan Officer with Fairway Home Mortgage, serving clients across Georgia, Alabama, Tennessee, Florida, South Carolina, and North Carolina. Recognized among the Top 1% Mortgage Originators in America, Chris is known for his precision, transparency, and dedication to educating homebuyers.

The Fed Rate Cut: What You Need to Know About Mortgage Rates

When the Federal Reserve announces a rate cut, it always makes headlines — and it’s easy to assume that means mortgage rates are automatically dropping too.
But that’s one of the biggest misconceptions in the housing market.

Let’s break down what a Fed rate cut really means and how it affects your mortgage options.

🎥 Watch my quick video explanation here:
👉 The Fed Rate Cut Explained – YouTube

🏦 What Is the Federal Funds Rate?

The “Fed rate” refers to the Federal Funds Rate, which is the short-term interest rate banks charge each other for overnight loans. It directly impacts credit cards, auto loans, and home equity lines of credit, but not fixed-rate mortgages.

When the Fed cuts rates, it’s a signal that they’re trying to stimulate borrowing and spending — usually because the economy is slowing down or inflation is cooling.

🏠 Mortgage Rates Don’t Move the Same Way

Here’s where it gets tricky:
Mortgage rates are not set by the Federal Reserve.

Mortgage rates are primarily driven by the bond market, especially the yield on the 10-year U.S. Treasury Note. When investors expect slower growth or lower inflation, they move money into bonds — which can push mortgage rates down even before the Fed acts.

So, mortgage rates move based on how the market reacts to what the Fed says and does, not simply on the Fed’s official rate cut.

Sometimes mortgage rates even rise after a Fed rate cut if investors think inflation could come back or the economy will rebound faster than expected.

📊 What This Means for Homebuyers and Homeowners

If you’re thinking about buying or refinancing, here’s the key takeaway:

✅ Don’t wait for a Fed announcement to decide when to act.
✅ Focus on overall mortgage rate trends and your personal financial goals.
✅ Rate cuts can create opportunity — but timing the market perfectly is nearly impossible.

My advice: stay informed, get pre-qualified early, and make decisions based on your long-term goals, not short-term news cycles.

💬 Final Thoughts

After more than 25 years in mortgage lending, I’ve seen how confusion around “the Fed rate” can cause hesitation that costs homebuyers great opportunities.
Remember — the Fed influences the economy, but the market drives mortgage rates.

If you’d like to understand how today’s market impacts your homebuying or refinancing plans, my team and I are here to guide you with clarity, precision, and care.

📞 Contact me anytime at Fairway Home Mortgage.
Let’s make sure you’re positioned for success — no matter what the Fed decides next.

Chris Shumate
Senior Mortgage Loan Officer | Fairway Home Mortgage
Serving GA, AL, TN, FL, SC, and NC