Executive Summary
NO SIGNIFICANT MOVEMENT IN RATES. Next week's Fed meeting almost certain to deliver no change. Markets aren't pricing probable cuts until mid-year. Contrary to the news, mortgage rates are NOT plummeting; what is plummeting is the spread between the 10 year and mortgage rates.
Interest rate premium on a 30 year mortgage compared to the 10 year treasury has dropped significantly in the last 3 weeks. Assuming this continues, mortgage rates will decrease slightly if the 10 year remains flat.
Current Rates
(Sources: Optimal Blue, Freddie Mac PMMS - January 23, 2026)
Consumer Mortgage Rates:
30-Year Conventional: 6.088% ↓ −0.015
30-Year Jumbo: 6.297% ↓ −0.013
15-Year Conventional: 5.342% ↓ −0.015
30-Year FHA: 5.918% ↓ −0.055
30-Year VA: 5.774% ↓ −0.012
Investor Mortgage Rates:
30-Year DSCR: 6.1% (assuming 75% LTV and 1.7 DSCR)
Fix & Flip: 10% to 11% (assuming 80% LTC)
Benchmarks:
10-Year Treasury: 4.231% ↓ −0.02
Fed Funds Rate: 3.50–3.75% (target range)
December CPI: 2.7% annual inflation
Events to watch
This Week:
Jan 27-28 (2:00 PM ET): FOMC Meeting + Press Conference
95.6% probability of NO CHANGE
Upcoming:
Feb 18: FOMC Minutes Release
Mar 17-18: FOMC Meeting + Economic Projections
Jun 17: First probable rate cut (60.7% odds)
Fed Rate Cut Probabilities
(CME FedWatch Tool)
Jan 28: 4.4% chance of cut
Mar 18: 15.4% chance of cut
Jun 17: 60.7% chance of cut (first probable cut)
Recommended Readings
Trump is expected to announce his choice to succeed Fed Chair Jerome Powell within the next few weeks. - The Hill.
At Davos Trump proposed a limit of 10% interest on credit cards and discussed banning Wallstreet from buying homes on Mainstreet. Link To Interview At Davos.
Commentary
With December inflation stable at 2.7% and the labor market resilient, the Fed has no urgency to cut rates. Chair Powell is expected to hold policy steady through spring, with another rate cut probably on June 17.
Practical takeaway: Current rates represent reasonable financing costs—nearly a full point below last year. Waiting for significant drops is speculative and unlikely. Consider jumbo and DSCR products as the rates are considerably favorable.
Data: Optimal Blue, Freddie Mac, BLS, Federal Reserve, CME Group
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