Mortgage Rates See the Biggest Drop in Over a Year

If you’ve been holding out hope for mortgage rates to finally come down, your patience just paid off. Last week, they fell sharply—marking one of the most significant drops we’ve seen in quite some time.

On Friday, September 5th, the average 30-year fixed rate tumbled to its lowest point since October 2024. Even more, it was the largest single-day decline in over a year, giving homebuyers a big reason to take another look at the market.

What Sparked the Drop?

According to Mortgage News Daily, this was a direct reaction to the August jobs report, which came out weaker than expected for the second month in a row. That sent signals across the financial markets and pushed mortgage rates lower.

In simple terms: when signs point to a slowing economy and markets feel more certain about where things are headed, mortgage rates tend to come down.

Why Buyers Should Pay Attention Now

This isn’t just a headline—it impacts your budget.

Lower rates mean lower monthly mortgage payments. For example, here’s the difference between rates in May (around 7%) and where they are now:

• At 7%, your monthly payment could be nearly $200 more.

• Today’s lower rates could save you about $2,400 per year.

That’s real money back in your pocket.

How Long Will It Last?

No one can predict exactly where rates will go next. They could keep dropping—or inch back up—depending on inflation data, the job market, and upcoming Fed decisions.

What matters is this: rates finally broke free from months of being stuck in the high-6% range.

As CNBC’s Diana Olick explains:

“Rates are finally breaking out of the high 6% range, where they’ve been stuck for months.”

That’s encouraging news for buyers who’ve been waiting on the sidelines.

Bottom Line

This is the shift you’ve been waiting for. Mortgage rates just saw their biggest decline in over a year. And if they stay near this level, a home that felt out of reach just a few months ago could now be within budget.

Curious what today’s rates could save you on a monthly payment? Let’s connect and run the numbers together.