Mortgage Rates Update: July 24th, 2025

In this week’s mortgage market update, economist Bill Knudson highlights a subtle shift in borrowing costs as markets digest recent inflation signals and adjust to modest changes in Treasury yields. Despite the headline stability, the spread dynamics point to deeper recalibrations in lender behavior.

---

For a $100,000 loan at 6.74%, the monthly payment is $648

Upcoming releases:

• The next new jobs report is August 1

  
  

• The next CPI release is Aug 12.  Actual July 15 Increases from 2.4% to 2.7% 

• The next Fed meeting is July 30

Mortgage Rates Update: July 24th, 2025

---

Key Takeaways:

• Marginal Decline in Mortgage Rates: The 30-year fixed mortgage rate decreased by 1 basis point (bp), moving from 6.75% to 6.74%. For a $100,000 loan, this lowers the monthly payment by $1 to $648.

• Payment Profile at 6.74%:

  • Interest portion: $393/month (61% of total)

  • Income required to qualify: $27,768

  • Income multiplier: 3.6x

• Spread and Market Positioning:

  • The spread between the 10-Year Treasury (4.43%) and mortgage rate widened slightly to 231bp.

  • This remains 63bp above the historical average (168bp), suggesting lenders are maintaining a conservative pricing buffer.

• Contextual Signals:

  • Treasury yields dropped 4bp over the week.

  • The CPI remains elevated at 2.4%, with continued attention on upcoming Fed and jobs data.

Knudson emphasizes that while rates are holding steady, the elevated spread reinforces caution within the lending sector. For borrowers, this continues to be a favorable but fragile window—where a stable interest rate environment may shift quickly with the next economic release.