Does the Fed Meeting Change Mortgage Rates? What the Oct 28 Decision Means for You
The Fed met this week, and my phone did what it always does on Fed day. "Did rates go down?" "Should I wait?" "My cousin said the Fed raised rates again."
So here's what actually happened on October 28, what it did (and didn't do) to mortgage rates, and what I'd think about if you're buying or refinancing right now.
What the Fed decided on October 28
The Federal Reserve held its benchmark rate steady at 3.75% to 4%. The vote was 10 to 2, and both dissenters, Governor Lisa Cook and Cleveland Fed President Beth Hammack, wanted to raise rates another quarter point. (Federal Reserve statement)
A little background: this hold comes after the Fed raised rates a quarter point in September. The statement said the economy is growing at a strong pace, the job market is steady, and inflation "remains elevated." In plain English, the Fed is in wait-and-see mode, and it hasn't ruled out raising rates again. Several economists are already watching the December meeting for another possible hike. (CNBC)
So did mortgage rates move?
Barely. Mortgage News Daily's daily index had the average 30-year fixed at 7.35% on October 28, up just 0.02% from 7.33% the day before. Their take was that the Fed announcement itself had no impact on mortgage rates that day. The small bump came from bond market moves earlier in the day. (Mortgage News Daily)
Freddie Mac's weekly survey had the 30-year at 7.32% for the week ending October 22, 2026. (Freddie Mac PMMS) A year ago, rates were closer to the low 6s, so if you're feeling like things got more expensive, you're not imagining it.
These are national averages, not a quote. Your rate depends on your credit, down payment, loan type, and property, and rates change every day.
Why the Fed doesn't set your mortgage rate
This is the part most people get wrong, and I don't blame them. The headlines say "the Fed sets interest rates," so it sounds like the Fed sets mortgage rates too. It doesn't.
The Fed controls a short-term rate, the one banks charge each other overnight. A 30-year mortgage is a long-term loan, so its rate follows long-term money: mainly the 10-year Treasury yield and the market for mortgage bonds. Those move on inflation reports, jobs data, oil prices, and what investors expect the economy to look like years from now.
Here's proof from this fall. When the Fed raised rates a quarter point in September, mortgage rates rose by more than that in the month after, because investors were worried about inflation, not because of the hike itself. And this week, a "no change" from the Fed meant almost no change in mortgage rates, because the market had already expected it. (Inman)
The 10-year Treasury has been sitting right around 5% lately. As long as it stays up there, 30-year mortgage rates are likely to stay in the 7s. That's not a prediction, just how the math has been working.
What it does affect: HELOCs and credit cards
The Fed's rate matters more for loans that adjust with the prime rate. That includes most home equity lines of credit (HELOCs) and credit cards. Prime usually runs about 3 percentage points above the Fed's rate, so a hold means those rates stay where they are for now. If the Fed raises again in December, expect those to go up with it.
If you've got a HELOC balance you've been meaning to pay down or roll into something fixed, this is a good time to look at your options.
What a small rate change really costs (an example)
Here's a quick way to put Fed-week headlines in perspective. Say you're borrowing $400,000 on a 30-year fixed. These rates are examples only, not a quote.
- At 7.35%: about $2,756 a month principal and interest
- At 7.10% (a quarter point lower): about $2,688 a month, roughly $68 less
- At 7.60% (a quarter point higher): about $2,824 a month, roughly $68 more
A quarter point is real money, about $800 a year on that loan. But a 0.02% move like we saw on Fed day is a couple of bucks a month. Don't let the headlines rush you, and don't let them freeze you either. You can run your own numbers on our mortgage payment calculator.
What I'd do if you're buying or refinancing
- Under contract and closing soon: the Fed meeting is behind us, but rates can still move on the next inflation or jobs report. If the payment works, I'd lean toward locking. I walked through that decision in Should I Lock My Mortgage Rate Today or Wait?
- Still house hunting: don't plan your purchase around a Fed rate cut that may not come soon. Plan around a payment you're comfortable with today. If you're not sure what that number is, start with How Much House Can You Actually Afford?
- Want a lower payment up front: with rates in the 7s, sellers and builders are more open to paying for a temporary buydown. Here's how that works: What Is a 2-1 Buydown?
- Thinking about a refinance: if your rate is well above today's averages, it can still be worth a look. If you locked in the 6s or lower, you're probably better off keeping that loan.
FAQ
Did the Fed raise interest rates in October 2026?
No. On October 28, 2026, the Fed held its benchmark rate at 3.75% to 4%. Two members voted for a quarter-point increase.
Do mortgage rates go down when the Fed holds or cuts rates?
Not automatically. Mortgage rates follow the 10-year Treasury yield and mortgage bond market, which react to inflation and the economy. Markets often price in a Fed decision before it happens.
When is the next Fed meeting?
The next meeting is scheduled for December 2026. You can see the dates on the Fed's meeting calendar.
Does the Fed decision affect my HELOC?
Usually, yes. Most HELOCs are tied to the prime rate, which moves with the Fed's rate. Fixed-rate mortgages don't change once you've closed.
Should I wait for rates to drop before I buy?
Nobody can tell you for sure where rates are headed, me included. If you find the right home and the payment fits your budget, waiting for a rate drop is a gamble.
Questions about your own numbers?
Headlines are general. Your situation isn't. If you want to know what this week's news means for your purchase or refinance, whether it's a conventional, FHA, or VA loan or something on our loan programs page, reach out through our contact page. I'll give you a straight answer.
Jerry Kindig, NMLS #2397823 | Loan Factory, NMLS #320841 | Equal Housing Opportunity
This article is for general information only. It is not a commitment to lend or an offer of credit. Rates and programs change daily and are subject to credit approval, underwriting, and property eligibility. Example rates and payments are for illustration only. Market rate data is from Mortgage News Daily (October 28, 2026) and Freddie Mac's Primary Mortgage Market Survey (week ending October 22, 2026).
