US mortgage rates show mixed movement as refinance activity surges

US mortgage and refinance rates exhibited mixed movement on Tuesday, July 14, 2026, according to data from the Zillow lender marketplace. The average rate for a 30-year fixed mortgage decreased by two basis points to settle at 6.42 per cent. This decline contrasts with upward pressure on other loan products, as the average 15-year fixed rate rose by 10 basis points to 5.92 per cent.

The 5/1 adjustable-rate mortgage (ARM) also saw an increase, climbing 14 basis points from the previous day to reach 6.57 per cent. While ARMs typically feature an initial fixed-rate period followed by annual adjustments based on economic factors, recent trends have seen ARM starting rates occasionally exceed those of fixed-rate offers.

Refinance applications have surged significantly, rising by more than 62 per cent year-on-year. This increase in activity is driven by mortgage rates dropping more than half a point since the end of May 2026. Refinance rates are generally higher than purchase rates, but the recent downward trajectory in overall yields has prompted borrowers to seek lower costs.

Looking ahead, major financial institutions have issued forecasts for the remainder of the year and into 2027. The Mortgage Bankers Association (MBA) projects that 30-year fixed rates will remain near 6.50 per cent through 2026 and into all of 2027. Conversely, Fannie Mae predicts a slightly more optimistic outlook, forecasting an average 30-year rate of 6.4 per cent for the rest of 2026 and approximately 6.3 per cent for most of 2027.

The broader housing market outlook for 2027 suggests marginally lower mortgage rates alongside cooling home prices. While 15-year mortgages generally offer lower interest rates and total interest costs compared to 30-year terms, they require higher monthly payments. Borrowers are advised to consider these trade-offs, as well as the inclusion of property taxes and insurance in total monthly cost estimates, when evaluating their options.