Where Mortgage Rates Stand in Early 2026
As of early February 2026 the 30-year fixed mortgage rate is hovering in the 6.0–6.4% range nationally, down from the 7%+ peaks of 2023–2024 but still well above the pandemic-era sub-3% rates many buyers remember. The Federal Reserve's measured approach to rate cuts throughout 2025 brought some relief, but rates have settled into a new normal that's reshaping buyer behavior.
What's Driving Rates Right Now?
Federal Reserve Policy
The Fed cut its benchmark rate several times in 2025, bringing the federal funds rate down from its peak. However, mortgage rates don't move in lockstep with the Fed—they're more closely tied to the 10-year Treasury yield, which reflects broader economic expectations including inflation, GDP growth, and government borrowing.
Inflation Trends
Core inflation has moderated to the 2.5–2.8% range—closer to the Fed's 2% target but not quite there. Until inflation is firmly under control, mortgage rates are unlikely to dip below 5.5% for any sustained period.
Housing Supply
Colorado's housing inventory has improved since the extreme shortages of 2021–2022, but remains below historical norms. In mountain markets, limited land and strict zoning keep supply constrained, supporting prices even as rates remain elevated.
Spring 2026 Rate Forecast
Most economists and mortgage industry analysts expect rates for the spring buying season to fall in these ranges:
- 30-year fixed: 5.75%–6.25%
- 15-year fixed: 5.0%–5.5%
- Jumbo (30-year): 6.0%–6.5%
- ARM (5/1 or 7/1): 5.25%–5.75%
A meaningful drop below 5.5% would require a significant economic slowdown or a more aggressive Fed cutting cycle—neither of which is the base case.
What This Means for Colorado Buyers
Affordability Math
At 6% on a $600,000 loan the monthly principal and interest payment is approximately $3,597. If rates drop to 5.5% that same loan costs $3,406—a savings of $191/month or about $69,000 over 30 years. Worth waiting for? Maybe, but the risk is that prices rise while you wait.
The "Marry the House, Date the Rate" Strategy
This popular advice holds true in 2026: buy the right property now and plan to refinance when rates improve. In Colorado's mountain markets, limited inventory means the right property may not be available next season.
Rate Locks and Float-Downs
We offer extended rate lock options (45–90 days) and float-down provisions that let you capture rate decreases during your lock period. This gives you certainty while preserving upside if rates improve before closing.
Strategies to Get the Best Rate
- Boost your credit score: Even 20 points can move your rate by 0.125–0.25%. Pay down credit card balances, avoid new credit applications, and correct any errors on your report.
- Increase your down payment: Loan-to-value ratio matters. Going from 10% to 20% down eliminates PMI and typically improves your rate.
- Consider discount points: Paying 1 point (1% of loan amount) upfront can buy down your rate by ~0.25%. If you're keeping the home 5+ years, the math often favors buying points.
- Compare loan types: A 7/1 ARM at 5.5% versus a 30-year fixed at 6.1% saves significantly in the early years. If you plan to refinance or sell within 7 years, an ARM can be smart.
- Get pre-approved early: Multiple pre-approvals within a 14-day window count as a single credit inquiry. Shop rates without penalty.
Our Take
We believe spring 2026 offers a solid buying window for Colorado mountain property. Rates are meaningfully lower than their 2023 peaks, inventory is reasonable, and the long-term value proposition of Colorado real estate remains strong. Waiting for the "perfect" rate often means missing the right property.
Ready to explore your options? Contact Cedar Home Loans for a personalized rate quote and buying strategy tailored to your Colorado market.
