Will mortgage rates drop below 5% in 2026? Here's what experts say.

Mortgage rates have been on a slow but noticeable decline over the past year. And in recent months, they actually reached their lowest point in over three years. There are no multiple ways in which qualified borrowers can secure rates under 6% now.

It's great news for hopeful homebuyers, as well as existing homeowners who have been eyeing a refinance. But it also begs the question: How low can mortgage rates actually go? Could they fall below the 5% mark at some point in the near future?

There's no hard-and-fast answer, so we asked some mortgage pros what they think — and how to get the lowest possible rate you can in today's market. 

Start by seeing how low your current mortgage rate offers are here.

Will mortgage rates drop below 5% in 2026?

Rates would need to fall more than a full percentage point to get below 5%, according to Freddie Mac's most recent numbers, although Zillow has a few options listed already in the high-5% range. And while that's possible, "a number of pieces would need to fit into the puzzle," according to Jeff DerGurahian, chief investment officer and head economist at loanDepot.

"We'd need to see inflation falling to pre-COVID levels, significant weakness in the labor market, and data that signals slower economic growth," DerGurahian says. 

President Trump's recent announcement of a potential $200 billion in mortgage-backed securities (MBS) purchases could also push rates lower, some experts say. 

"There are several indicating factors that cause mortgage interest rates to rise and fall, and two key ones come from the bond market - the 10-year treasury and mortgage-backed securities," says Lynette Arrasmith, a mortgage advisor for Churchill Mortgage. "It certainly is not a tick-for-tick situation, but I liken the movement of mortgage interest rates to that of a teeter-totter. If we see mortgage-backed securities gaining value, we will likely see mortgage interest rates decrease."

Compare mortgage rates and lenders online to learn more.

What could keep mortgage rates from dropping below 5% in 2026?

While many mortgage experts think rates will fall this year, they say a drop below the 5% level is highly unlikely. As David Kakish, a home loan expert at Anchor Home Loans, explains, "There's a path to sub-5 percent rates, but it's a very low-probability outcome. Sticky inflation, resilient growth, or large-scale government borrowing could all keep pressure on long-term yields."

Right now, the two major industry forecasts — ones from Fannie Mae and the Mortgage Bankers Association, predict that rates will finish out the year at 6% and 6.4%, respectively. Those predictions get updated monthly and can change based on market conditions. 

"While labor and inflation data have gradually shown signs of softening, the pace so far is still supportive of lower mortgage rates but not pronounced enough to drive them below the 5% threshold," DerGurahian says. "If this trend continues, it's unlikely we'll see rates drop below 5%. Little to no action from the Fed will also prevent them from falling significantly."

How to get the lowest mortgage rate possible right now

Whatever direction rates move, there are ways to ensure you're getting the lowest possible rate offered at the moment. And right now, DerGurahian says, opting for an adjustable-rate mortgage is a great option. 

"ARMs can provide about a 50- to 75-basis point advantage over 30-year fixed rates, which can significantly reduce your monthly payments in the near term," he says. 

You can also look to shorter-term loans. According to Freddie Mac, 15-year loans currently have an average interest rate of just 5.38% right now — nearly .70 lower than on 30-year loans. 

Shopping around for your lender or working with a mortgage broker can also help.

"Mortgage brokers can often access wholesale pricing across multiple lenders, which gives them a real edge over banks and retail channels," Kakish says. "That edge can be especially significant on government loans, where rate spreads of a full percentage point or more aren't unusual."

The bottom line

Experts and industry forecasts don't expect rates to go below 5% anytime soon, but only time will tell. Watch inflation, pay attention to purchases of mortgage-backed securities, and monitor the 10-year Treasury yield, which 30-year mortgage rates tend to follow.

Most importantly, have your ducks in a row so you can act fast when rates are right. Rates can change quickly, and locking your rate at the right time can mean a big difference in your monthly and long-term costs.