Mortgage Rates This Week – October 1, 2026

Mortgage rates moved higher again this week as a continued selloff in the bond market pushed long-term Treasury yields to their highest levels in decades. The 30-year fixed mortgage rate at the time of this post is 7.000%, with a 7.212% APR and 1.953 points, or 7.375% with a 7.411% APR and 0.202 points, for top-tier borrowers who put 25% down and have a credit score of 780 or higher. The 15-year fixed mortgage rate for the same category of borrowers is 6.250%, with a 6.654% APR and 2.370 points; or 7.000%, with a 7.051% APR and 0.169 points.

The bond market remained under significant pressure this week, extending the rise in Treasury yields that began in September. The 10-year Treasury yield reached approximately 5.34% on Thursday, its highest level in roughly 24 years, as investors continued to adjust to the prospect of higher interest rates lasting longer than previously expected. Persistent inflation concerns, strong economic activity, rising energy costs, and broader pressure across global bond markets have all contributed to the move.

Wednesday’s inflation report offered some encouraging news but was not enough to reverse the broader trend in the bond market. The Federal Reserve’s preferred inflation measure, the Personal Consumption Expenditures price index, showed that core PCE inflation increased 0.2% in August and 3.0% from a year earlier. The annual core reading was unchanged from July, while the monthly increase came in slightly below expectations.

Consumer spending, however, remained strong. Personal consumption expenditures increased 0.9% in August, while personal income rose only 0.2%. The combination of resilient spending and inflation that remains above the Federal Reserve’s 2% target leaves policymakers with a difficult balance between controlling inflation and avoiding unnecessary pressure on economic growth.

For mortgage borrowers, the impact is particularly visible in national rate trends. Mortgage News Daily’s daily index showed the average top-tier 30-year fixed rate climbing from 7.45% last Thursday to 7.58% on Monday, September 29, after reaching 7.50% the previous trading day. This continues the sharp increase that began during September and illustrates how quickly mortgage rates have responded to the rise in Treasury yields.

Mortgage application activity has weakened substantially as borrowing costs have risen. Total mortgage applications declined 6.0% for the week ending September 25, according to the Mortgage Bankers Association. Purchase applications fell 4%, while refinance applications declined 9%. MBA’s average conforming 30-year fixed mortgage rate increased for the sixth consecutive week, reaching 7.30% from 7.12%, its highest level in nearly three years. Adjustable-rate mortgages accounted for 10.3% of applications, their highest share since October 2025, as borrowers increasingly looked for alternatives to higher fixed rates.

The outlook for mortgage rates remains closely tied to Treasury yields and expectations for Federal Reserve policy. The softer August inflation data reduced some of the immediate pressure for another rate increase, but inflation remains above the Fed’s target and the broader bond market continues to price in a higher-rate environment. Until Treasury yields stabilize, mortgage rates are likely to remain volatile and sensitive to incoming inflation, employment, and economic-growth data.

Fall Buying Season

As the housing market moves into October, higher mortgage rates continue to create affordability challenges for buyers. At the same time, the seasonal slowdown in housing activity can provide opportunities for qualified borrowers who remain active. With fewer buyers competing for available homes than during the peak spring and summer months, buyers may have more negotiating leverage even as financing costs remain elevated.

In Washington state specifically, buyers may still benefit from increased inventory and greater negotiating flexibility compared with tighter markets in recent years. Motivated sellers may be more willing to negotiate on price, closing costs, seller concessions, or rate buydowns as the market moves deeper into fall. A fully underwritten pre-approval can strengthen an offer when the right property appears, while rate buydowns and ARM products remain worth modeling for buyers with a defined time horizon. With mortgage rates responding quickly to Treasury yields and economic data, comparing the full cost of different financing structures remains more useful than waiting for a specific headline rate.

Current Mortgage Rates This Week for WA, OR, ID, CA, and CO From Sammamish Mortgage
10/01/2026

**Conforming assumptions – $800k Purchase Price, 25% Down, 800+ Credit
**Jumbo assumptions – $1.5MM Purchase Price, 25% Down, 800+ Credit

Washington State mortgage rates

Mortgage rates In Oregon

Mortgage rates in Idaho

Mortgage Rates for Colorado

California Mortgage Rates

National Average Mortgage Rates:

(State-specific rates sourced from Sammamish Mortgage – National Average rates sourced from Zillow)

Consumer Price Index, Consumer Sentiment & Inflation

Inflation is undoubtedly the most significant driver of interest rates. With that in mind, we continue to focus on inflation data and expectations going forward to gauge what we can expect to see in interest rates in the coming months. Inflation is re-accelerating above the Fed’s target of 2% as of March 2026. While current inflation numbers would typically warrant a lower Fed Funds Rate, the Fed has indicated that it wants to see the impact of tariffs before considering additional rate cuts.

Consumer Price Index (CPI) March = 0.9% – Annual = 3.3%  

Producer Price Index (PPI) March = 0.5% – Annual = 4.0%

Personal Consumption Expenditures (PCE) February = 0.4% – Annual = 2.8% 

Overall, it is difficult to predict what will happen with mortgage rates in the near term. With global economic turmoil, banking issues, inflation, and thus far a far more resilient economy than many expected, trying to predict rates from one day to the next to time a rate lock is almost impossible or at least requires luck. However, looking at a longer time horizon, it’s much easier to see that there is an excellent chance we could see rates move lower from current levels, providing an opportunity for recent and existing buyers to potentially refinance in the future.

See Current Rates

What the Fed rate hike means for borrowers, savers, and investors

When the Federal Reserve raises interest rates, it affects various aspects of the economy, including the housing market, savings, and investment.

For potential homebuyers, a Fed rate hike typically leads to an increase in mortgage rates in the early stages of a tightening cycle; however, if the market thinks the Fed rate increases will hurt the economy and cause inflation to decrease, mortgage rates can improve when the Fed raises the Fed Funds Rate. It’s important to note that the Fed does not control mortgage rates. Fed rate increases do directly impact credit card rates, car loans, and commercial loans, which are shorter in duration than a typical 30-year fixed mortgage.

For savers, a Fed rate hike may lead to higher returns on savings accounts and certificates of deposit (CDs). In addition, banks and other financial institutions may increase the interest rates they pay to savers to remain competitive, which can benefit savers looking to earn more on their savings.

A Fed rate hike may impact the stock and bond markets for investors. Typically, when interest rates rise, the value of stocks and bonds can fall as investors may shift their money to fixed-income investments with higher returns. However, the impact of a rate hike on the markets can be complex and depends on various factors, such as the overall state of the economy, inflation expectations, and global events.

Loan Limits Increased For 2026

Loan limits have increased for 2026. Each county in every state has its loan limit. That said, the new standard conforming loan limit is $832,750, and high balance limits in select high-priced areas can go up as high as $1,063,750 for 1-unit properties in 2026.

Visit our 2026 conforming loan limit pages for Washington State, Oregon, Idaho, California, and Colorado.

For FHA loan limits, see our 2026 FHA pages for Washington State, Idaho, Colorado, California, and Oregon.

Check out our mortgage loan limit tool for conventional, FHA, and VA loans.

Instant Mortgage Rate Quote

Ready to Apply For a Mortgage?

Do you have questions about rates this week and home loans? Or are you ready to apply for a mortgage to buy a home? If so, Sammamish Mortgage can help. We are a local mortgage company from Bellevue, Washington, serving the entire state, as well as Oregon, Idaho, California & Colorado. We offer many mortgage programs to buyers all over the Pacific Northwest and have been doing so since 1992. Our programs include the Diamond Homebuyer Program, Cash Buyer Program, and Bridge Loans. Contact us today with any questions you have about mortgages.