US mortgage rates hit their highest level in three years

Rising borrowing costs have pushed mortgage applications to their lowest level since February 2025. Rising borrowing costs have pushed mortgage applications to lowest level since February 2025. Mortgage rates in the United States have hit their highest level in nearly three years, as cost-of-living concerns weigh on Americans less than a month before the midterm elections. The average cost for a 30-year fixed-rate mortgage jumped 19 basis points to 7.49 percent for the week ending October 2 , according to the Mortgage Bankers Association’s weekly report released on Wednesday. Meanwhile, applications for mortgages tumbled 4.2 percent from the previous week, according to the report. Applications are at their lowest level since February 2025 and have fallen by almost half since the beginning of the year.

“Very few homeowners have an incentive to refinance at these rates, and the jump in borrowing costs has caused many potential borrowers to step back from the purchase market,” Joel Kan, vice president and deputy chief economist at the Mortgage Bankers Association, said in a press release. Mortgage rates are closely tied to US 10-year Treasury notes. Earlier this week, those hit a 24-year high of 5.3 percent amid surging oil prices tied to ongoing tensions with Iran. Meanwhile, the yield on 30-year Treasury bonds rose to its highest level since 2002, at 5.7 percent