Mortgage Rates Climb to 6.40% as June Jobs Report Disappoints; Fed Rate Outlook Pressures Borrowers

Mortgage rates rose meaningfully on Thursday, July 2, dealing a setback to prospective homebuyers and refinancers. The average rate on a 30-year fixed mortgage climbed to 6.40% APR, according to data provided to NerdWallet by Zillow. This represents an increase of 12 basis points from the previous day and 15 basis points higher than a week ago.

Despite daily fluctuations, mortgage rates have remained largely stable throughout June, holding near 6.34% compared to May’s 6.35% average. With markets closed tomorrow for the July 4th holiday, regular daily updates will resume Monday.

Kate on Rates: June 25, 2026

What influences mortgage rates?

Mortgage rates fluctuate constantly, driven by reactions to economic data, employment reports, Fed policy moves, and global events. Even minor shifts in bond markets can impact pricing.

The latest Bureau of Labor Statistics jobs report showed June hiring of 57,000—well below expectations of 115,000. This follows three consecutive months of stronger-than-forecast job growth. Were June’s reading also above target, the case for a July Fed rate hike would be firmer.

Last week, the Fed’s preferred inflation gauge—the Personal Consumption Expenditures index—showed a 4.1% annual pace, the highest in three years. Given the latest data, the Fed is positioned to maintain current policy through its July meeting, potentially delaying tightening until September.

While the Fed doesn’t set mortgage rates directly, its decisions shape broader borrowing costs. Market expectations around future rate moves influence today’s mortgage pricing—even anticipated hikes can push rates upward.

Looking ahead, the June Existing Home Sales report (released July 9) will offer insight into current housing demand. For now, refinancing may be worthwhile if your current rate exceeds 6.90%, or if today’s rates are 0.5–0.75 percentage points below yours and you plan to stay put long enough to recoup closing costs.

When weighing options, consider your goals: reducing monthly payments, shortening term length, or accessing equity. A cash-out refinance may carry a higher rate than rate-and-term but still make sense if total costs are lower than a HELOC or second mortgage.

Should I start shopping for a home?

There’s no universal “right” time to buy—only whether you can comfortably afford today’s rates. If yes, focus on getting preapproved, comparing offers, and finding a payment that fits your budget. You can always refinance later.

If purchasing isn’t feasible yet, use the time to pay down debt and boost your down payment. These steps free up cash flow and improve your rate eligibility.

Should I lock my rate?

If you’ve received a quote you like, locking your rate offers protection against further increases while your loan processes. Some lenders also provide float-down provisions, allowing you to benefit if rates improve during your lock period.

In volatile markets, the certainty of a locked rate often outweighs the risk of waiting.

Nerdy Reminder: Rates update daily. If you’re satisfied with your offer, committing is perfectly reasonable.

Why is the rate I saw online different from the quote I got?

Advertised rates are samples—for borrowers with strong credit, substantial down payments, and sometimes discount points. Your personalized quote reflects your specific financial profile.

Even two borrowers with similar credit scores can receive different quotes based on their overall financial picture.

If I apply now, can I get the rate I saw today?

Potentially—though personalized quotes can shift until you lock. Lenders adjust pricing multiple times daily in response to market conditions.

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