From my perspective as someone who has observed the Korean real estate office in the Burke area for a long time, it has become apparent that more than half of the recent buyer consultations start with inquiries about mortgage rates.

In the past, buyers would first ask about the location of properties and school districts, but now the order has changed to checking rates first and then determining their budget. Based on my long experience in the market, I will carefully outline how mortgage rates are formed.

There are several factors that influence mortgage rates. The main elements include:

• 10-year Treasury yield - the benchmark for long-term fixed-rate products
• The Federal Reserve's benchmark interest rate and monetary policy direction
• Trends in inflation indicators
• Demand in the MBS (Mortgage-Backed Securities) market
• Personal credit scores, DTI, and down payment ratios

Among these, the movement of the 10-year Treasury yield is the most frequently referenced indicator for gauging the overall direction of the market. Even when the Federal Reserve adjusts the benchmark interest rate, we have seen several instances where mortgage rates do not move in tandem, as mortgage rates are more closely linked to the long-term Treasury market than to short-term policy rates.

According to Freddie Mac PMMS statistics from mid-2026, the average rate for a 30-year fixed mortgage is observed to be in the mid to high 6% range. The 15-year fixed rate is typically about 0.5 to 1 percentage point lower, due to the structural reason that the risk burden on lenders decreases with shorter repayment periods.

I recommend a cautious approach to ARM products. While they start with lower rates for the first few years, there is a risk that payments may increase according to market rates after the fixed period ends. In areas like Burke, where many purchases are for long-term residency, fixed rates are often seen as a more stable choice.

The rate differences based on credit scores are also frequently observed in consultations. Rates are relatively favorable for those in the 760 and above range, while those dropping to the 620 to 680 range see noticeably higher rates under the same conditions. The exact difference can vary depending on the lender and timing, making it difficult to generalize.

Burke is a region within Fairfax County that has a high preference for school districts, resulting in a significant proportion of long-term purchases for residential purposes. Due to this regional characteristic, many buyers prioritize the stability of monthly payments, leading to a higher preference for fixed rates.

There are two main preparations I would recommend for Korean households. First, reduce credit card usage and manage it without any delinquencies at least six months before applying for a loan. Second, organize documents such as income verification and tax returns in advance. Just having these two things in order can significantly improve approval conditions, as I have seen in many cases.

The future trend of rates may adjust gradually based on economic indicator announcements. Rather than making definitive predictions, I believe that assessing based on one's financial situation is the most realistic approach from my long-term observation of the market.