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If you’ve been a prospective homebuyer in recent years, you might be forgiven for thinking that there were no “good” mortgage interest rates available. That’s because there often weren’t.
At one point in 2023, for example, mortgage interest rates surged to their highest point since 2000. While that would have been remarkable in any climate, it was made more so considering that rates here were hovering near record lows just a few years earlier.
But the economy and, specifically, the mortgage interest rate climate is changing again.
The Federal Reserve issued three rate cuts in the final months of 2024 and, last month, they issued another one. There are also two others widely expected for the central bank’s final 2025 meetings in October and December, opening the door for further mortgage rate declines. And the mortgage rate climate is already responding, with rates here briefly declining to a three-year low in September.
Before getting started with a home purchase, however, it helps to have the proper context for this unique moment. That begins with understanding the mortgage rate climate and, specifically, what’s considered to be a good mortgage interest rate now that the Fed’s cutting rates again.
Start by seeing how low your current mortgage rate offers are here.
What’s a good mortgage interest rate now that the Fed’s cutting rates again?
Mortgage rates on a 30-year term temporarily declined to an average of 6.13% in September, right before the Fed cut interest rates. But they’ve since risen slightly as that cut had a chance to reverberate throughout the broader economy. At 6.30%, according to FreddieMac, rates are not quite as low as they were a few weeks ago, but they’re considerably more affordable than they were earlier this year. So, buyers who act now can realize significant savings compared to what they would have had to spend in January, for example, when rates were around 7%.
In other words, if you can find a 30-year mortgage rate between 6.13% and 6.30% now, you can consider it a good one, even if it’s still not quite as affordable as it was in 2020 or 2021. That said, there are secure and reliable ways to get a rate even lower than 6.13% now, perhaps comfortably in the 5% range.
An adjustable-rate mortgage (ARM), for example, allows owners to lock in a below-average rate now (think between 5.50% and 5.75% approximately). That rate will expire and revert to the then-standard average after a set period of time (five or seven years, for example). But it will allow buyers to secure a low rate now and, hopefully, when it expires in the future, the rate climate will be more affordable then. In the interim, buyers can purchase a home now without having to delay any further.
Mortgage points, on the other hand, may be more appealing to buyers who want to lock in a low rate for the full 30-year term, which ARMs do not allow. By paying a fee to the mortgage lender, either upfront in the closing costs or by rolling it into the larger mortgage loan, homebuyers can secure a lower, fixed rate. It can be worth purchasing, however, especially if it makes the difference between purchasing a home at a rate of 5.75% or having to delay a purchase further with a rate of 6.25%.
Compare all of your current mortgage rate offers and options here to learn more.
The bottom line
A good mortgage rate now, in early October 2025, can be considered to be one in the low 6% range. But this is a fluid definition that can and will change over time, perhaps even sooner than anticipated if driving factors behind mortgage rates adapt. Take the time, then, to shop around for rates and lenders. Consider alternatives like adjustable-rate mortgages and the purchasing of mortgage points, too. And remember that mortgage rates can rise as easily as they can fall, so if you’ve found your dream home now and the budgeting works, it may make the most sense to buy it anyway. You can always refinance to a better rate in the future, but today’s home inventory may not be available for much longer.
