Is This the Start of Lower Mortgage Rates?

The 10-Year Treasury Just Hit a 12-Month Low — Here’s What That Means for You.

The 10-Year Treasury yield has reached its lowest level in 12 months — a key signal that mortgages and Home Loan rates could soon follow.

Over the past year, both buyers, first time home buyers, refinancers and realtors have been watching mortgage rates closely, waiting for signs that relief might finally be on the horizon. This week, we got one. The 10-Year Treasury yield, one of the biggest indicators of where mortgage rates are heading, just dropped to its lowest level in 12 months, around 3.99%. That might not sound dramatic, but in the mortgage world, it’s a big deal, and potentially a turning point.

The 10-Year Treasury Just Hit a 12-Month Low

The 10-Year Treasury yield has long been viewed as a leading indicator for mortgage rates. When it falls, rates often follow. This recent drop marks the first real downward momentum we’ve seen in nearly a year, signaling that the market may finally be shifting in a more favorable direction for borrowers. So, what’s driving it? Cooling inflation data has reduced pressure on long-term bonds. The Federal Reserve’s latest comments suggest rate hikes are likely paused. Investors are pricing in rate cuts for 2026 — adding optimism to the bond market. Together, those factors have pushed yields lower and opened the door for mortgage relief ahead.

What This Means for You

For First Time Homebuyers and repeat Home Buyers: Lower Treasury yields often translate into lower mortgage rates, which means more buying power. Even a 0.5% drop in rates can increase what you qualify for or save you hundreds per month on the same home. If you’ve been waiting for “the right time,” this could be it.

For Realtors: This is the moment to reconnect with past clients who hit pause earlier this year. As affordability improves, they’ll re-enter the market — and being proactive now could mean more closings before year-end. 

For Homeowners: A lower yield also opens the door for refinance opportunities. Whether you’re looking to lower your payment or pull cash out for renovations, it’s worth reviewing your options as rates begin to shift.

The Bigger Picture

Markets are reacting to signs that inflation is cooling and that the Federal Reserve may hold or even reduce rates in 2026. While mortgage rates won’t fall overnight, this 12-month low in the 10-year yield is a strong signal that the worst may be behind us. If that trend continues, we could see mortgage rates settle closer to the mid-6% range in the coming months — a level that could reignite both homebuying and refinancing activity.

The Bottom Line

This is a pivotal moment for the market — one that rewards those who stay informed and act early. At Proper Lending Group, we’re watching the data daily and helping our clients position themselves for what’s next. If you’re wondering how this could impact your next move, call Proper Lending Group at (281) 413-2121 or schedule a quick consultation at https://calendar.app.google/95Np7A4pW9dnoe7y7 . Whether you’re buying, refinancing, or planning ahead, we’ll help you make the most of this opportunity.

About Proper Lending Group 

Proper Lending Group is a Houston-based mortgage brokerage dedicated to helping borrowers and Realtors succeed through fast closings, smart loan options, and unmatched local service. Located in East Downtown Houston, we proudly serve the surrounding communities, offering solutions for all credit types and income situations.

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