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Mortgage rates took their biggest step up in a month. Freddie Mac's September 17 survey put the 30-year fixed at 6.95%, up from 6.76% a week earlier, and the 15-year at 6.26%, up from 6.09%. A year ago those averages were 6.26% and 5.41%. That's four straight weekly increases, and the 30-year is now within a whisker of 7%.
The number itself gets the headlines. What I want to talk about is the quieter problem it creates.
Most pre-approval letters are written at a specific rate. When rates climb almost two-tenths of a point in a week, the payment behind that letter climbs with them, and the maximum price your lender signed off on can quietly shrink. A $350,000 loan at 6.95% runs about $2,317 a month in principal and interest. The same loan at last year's 6.26% was about $2,157. If your lender qualified you on a payment ceiling, that gap has to come from somewhere, and it usually comes out of your price range.
Here's why that matters in Houston right now. Sellers and listing agents read pre-approval letters closely. A letter dated six weeks ago, at a rate that no longer exists, is a weaker letter than it was when it was written. I've watched buyers lose a negotiation not because their offer was bad but because the seller's side had doubts about whether the financing would still hold at closing.
So this week's homework is simple. Call your loan officer and ask two questions. First, what does my approval look like at today's rate? Second, if I'm ready to go under contract, what does a rate lock cost, and does it come with a float-down option if rates ease before we close? A lock protects you if rates keep climbing. A float-down gives you a shot at the better number if they don't. Not every lender offers one, and that alone is a good reason to compare two or three.
The usual caveat, and I mean it: these are national averages for borrowers with strong credit and 20% down. I'm a real estate broker and REALTOR®, not a lender. Your credit, loan type, and down payment all move the number, so get a real quote before you plan around it.
What I don't want you to do is treat a rate near 7% as a stop sign. Houston still has more homes to choose from and more room to negotiate than it did two years ago, and a seller credit toward your closing costs can buy down a meaningful piece of that rate. The buyers who win in weeks like this are the ones whose paperwork is current and whose lender is already on speed dial.
If you're weighing a move anywhere in the Houston area, I'm glad to talk it through with no obligation. Reach me, Kevan Pewitt, at Houston Prime Realty. Call or text (281) 500-7077.
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