Mortgage Rates at 7% and the Cost of Trade Finance
Ossiano Research · Market Read
Mortgages cross 7%. The rate cycle reaches trade.
US home loan rates passed 7% this week. That is the headline. The bigger story for business is that the cost of money is rising across the board, including the money that pays for goods while they are being shipped.
7.03%
Average 30-year US home loan rate
This week. It was 6.30% a year ago.
5.04%
10-year US Treasury yield
Sep 15. The highest in nearly 20 years.
+0.25
rate rise,
Sep 16. The first rise in more than three years.
~75%
Chance of another rise in October
Market pricing on Sep 23 ( data).
Terms like this have a quick explainer. Tap or hover on them.
01 · The headline
Home loan rates just passed 7%
The average rate on a 30-year fixed US home loan hit 7.03% this week, according to Freddie Mac. Five weeks ago it was 6.65%. A year ago it was 6.30%. This is the first time it has been above 7% since early 2025.
Why does 7% matter? Mostly because people notice it. As The Wall Street Journal points out, US home loan rates had not been that high between 2001 and 2022, so many homeowners are used to rates of 3% or 4%. Rates briefly fell below 6% in February. Then oil prices jumped, global trade was disrupted, and rates climbed again.
Figure 1
Average 30-year home loan rate, week by week
Tap a point to see that week's rate. The dashed line marks 7%. The scale starts at 6.0%.
Source: Freddie Mac Primary Mortgage Market Survey, weekly releases August 20 to September 24, 2026.
02 · How rates move
Two kinds of interest rates are rising at once
It helps to think of interest rates in two groups.
Long-term rates, like a 30-year home loan, follow the . That is the return investors ask for when they lend to the US government for 10 years. It moves with investors' views on government debt, oil prices, inflation and the heavy spending on artificial intelligence. It was already pushing home loan rates up before the Fed acted, as The New York Times reported.
Short-term rates follow the more closely. Credit cards, personal loans and small-business loans are usually linked to the , a base rate that many banks set partly from the Fed's own rate. When the Fed raises its rate, these follow within a couple of monthly bills.
Trade finance, the money that pays for goods while they are made and shipped, often sits in this second group. So for trade, the Fed's decisions matter more than the 7% home loan headline.
Figure 2
Follow the chain
Pick one to see how a rise reaches it, step by step.
Sources: Freddie Mac; Federal Reserve; The New York Times, September 16, 2026; LSEG data via Reuters, September 23, 2026.
03 · Households
A new home loan now costs about $193 more a month
Take a new $400,000 home loan over 30 years. At last year's average rate of 6.30%, the monthly repayment is $2,475.89. At this week's 7.03%, it is $2,669.27. That is $193.38 more each month, or $2,320.59 more a year.
This only applies to people taking out a new loan or refinancing. Anyone already on a fixed-rate loan keeps paying the same. Credit card holders will feel the Fed's move sooner, usually within a couple of monthly bills.
Figure 3
Try it: the monthly repayment on a new loan
Move the slider to set the loan size. 30-year fixed rate, loan repayment only (principal and interest).
A year ago at 6.30%
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This week at 7.03%
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Extra per month / per year
-
Our Research Desk used Freddie Mac's average rates for September 24, 2026 and a year earlier, and the standard loan repayment formula. The slider stops just below $832,750, the 2026 limit for standard-size loans set by the Federal Housing Finance Agency, because Freddie Mac's averages cover loans up to that size.
This calculator explains the concept only. Actual loan costs vary with fees, taxes, insurance, credit history and each lender's offer.
04 · Housing
More homes were coming up for sale. 7% could slow that down.
There were 1.62 million existing homes for sale in August, the most since 2019. Owners had realized rates were unlikely to fall soon, and started listing.
Many of those owners still have loans at around 3%. At 7%, selling and buying again gets expensive, so some may stay put and renovate instead, The Wall Street Journal reports.
Other effects are already showing. Nearly 1 in 10 recent loan applications were for adjustable-rate loans, which start on a lower fixed rate for three to ten years and then reset, according to Mortgage Bankers Association data reported by CNN. Builders who pay to lower their buyers' rates now pay more to do it. And US home sales have been flat for four years running.
05 · Ossiano view
For trade, watch the Fed
Dollar trade finance is often priced in two parts: a that moves with the Fed, plus a fixed add-on called a margin. When the Fed raises rates, the base goes up, and so does the cost of every shipment being financed. Markets see around a 75% chance of another rise in October, according to data reported by Reuters on September 23. We looked at the wider picture in our September 24 Market Read on Fed rates and holiday trade.
Figure 4
Try it: what a rate rise adds to one shipment
Set the shipment value, how many days it is financed, and the size of the rise.
Shipment value
-
Days financed
-
Extra cost, total for the period
-
-
Our Research Desk used simple interest: shipment value × rate rise × days ÷ 360. It assumes the whole shipment is financed at a and the full rise is passed on.
This calculator explains the concept only. Actual financing costs vary with fees, margins, the base rate used and the terms of each facility.
OBSERVATION 01
Plan for two more Fed meetings
Goods bought in September and sold in January will be financed through the Fed's October and December decisions. If the rate floats, the cost goes up with each rise. Prices and budgets set today need room for that.
OBSERVATION 02
Watch the 10-year too
The 10-year Treasury yield reached 5.04% on September 15. It moves on debt, oil and inflation as well as on the Fed, so it can keep rising between Fed meetings.
OBSERVATION 03
Suppliers will want to be paid sooner
When it costs more to hold stock, suppliers have more reason to ask for early payment on their invoices. We expect more of these requests through the holiday season, as our September 24 Market Read set out.
Summary
Rates are rising on two fronts
Home loan rates passed 7% because long-term rates rose. Separately, the Fed raised short-term rates on September 16, and markets expect more.
People buying a home or carrying a card balance pay more now. For trade, the Fed's path matters most, because it sets the base rate for financing goods on the move. Businesses planning for the months ahead can allow for further rises in their prices and budgets.
The next dates to watch are the Fed's October and December meetings.
Further reading: our Market Read on Fed rates and holiday trade, The Wall Street Journal on the housing market at 7% and The New York Times on what the Fed rise means for household finances.
For questions on how these shifts affect existing or planned trade finance exposures, contact the Ossiano Research Desk.
Sources
- Freddie Mac, Primary Mortgage Market Survey, weekly releases August 20 to September 24, 2026. Weekly rates in Figure 1, the 7.03% and 6.30% figures, and the Figure 3 inputs.
- The Wall Street Journal, Mortgage Rates Just Hit 7%. Here's How the Housing Market Is About to Change, September 24, 2026. First reading above 7% since early 2025, the 2001 to 2022 and February 2026 comparisons, 1.62 million homes for sale, and the seller and builder points in section 04.
- The New York Times, How the Fed's Rate Increase Affects Your Finances, September 16, 2026. The 0.25 point rise, home loan rates rising before the Fed moved, the prime-rate link for cards, personal and small-business loans, and the 10-year Treasury at 5.04%.
- Reuters, Dollar jumps near 2-month high on Fed outlook, rising oil price, September 23, 2026. LSEG data putting the chance of an October rise at around 75%.
- Mortgage Bankers Association, weekly application survey, as reported by CNN on September 24, 2026. Share of applications for adjustable-rate loans.
- Federal Reserve, FAQ on the prime rate. How banks set the prime rate partly from the Fed's rate.
- Federal Housing Finance Agency, Conforming loan limit values for 2026. The $832,750 limit used to cap Figure 3.
- Ossiano Research, Higher US rates are raising the cost of the holiday season, September 24, 2026. Floating-rate pricing of dollar trade finance, and the outlook for supplier payment requests in Observation 03.
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