As you observe the real estate market in Lansing over time, you'll notice that first-time homebuyers tend to ask similar questions in sequence. We will address three main questions: who determines the rates, what the current levels are, and when is the best time to buy.

The first question is, who determines the rates? While it may seem that individual banks set them arbitrarily, they actually rely heavily on the market indicator known as the yield on 10-year Treasury bonds. When funds flow into safe assets in the bond market, yields decrease, and this trend is reflected in mortgage rates. Additionally, the Federal Reserve's interest rate decisions and inflation indicators also play a role.

The second question concerns the current levels. According to Freddie Mac PMMS data as of 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 mortgage tends to be slightly lower, around the high 5% to low 6% range, due to its shorter repayment period.

The third frequently asked question is whether to choose a fixed-rate or adjustable-rate mortgage (ARM). A 5/1 ARM often starts at a rate in the mid to high 5% range for the first five years, which can lower monthly payments initially, but it adjusts based on market conditions after that. Given that Lansing has many state government jobs and less frequent job changes, families planning to stay long-term may prefer the stability of a fixed rate.

The supply and demand in the MBS market, or mortgage-backed securities market, also affect rates. If investment demand decreases in this market, banks must offer higher rates to secure funding. These four factors—Treasury yields, Federal Reserve policies, inflation, and MBS supply and demand—interact to influence mortgage rates.

• 10-year Treasury yield
• Federal Reserve interest rate decisions
• Inflation indicators
• MBS market supply and demand

Another common question is why my rate differs from my neighbor's. The answer lies in credit scores, DTI (debt-to-income ratio), and down payment percentages. Comparing the ranges above 760 and around 620 can show a difference of nearly 1 percentage point for the same product at the same time. Lower debt-to-income ratios and higher down payments increase the likelihood of receiving better terms.

The final question is what Korean families should specifically consider. In the early stages of moving to the U.S., having a short credit history can lead to unfavorable rates, but consistently using credit cards and managing them without late payments can improve this over time. Additionally, it's advisable not to get quotes from just one lender but to compare multiple options, as this has proven to be the most reliable method over time. While it's difficult to predict rate trends, there is cautious optimism that rates may gradually decrease if inflation stabilizes.