Mortgage Rates Update — Week of Oct 3, 2025
Mortgage Rates Update - Week of Oct 3, 2025
Powered by First Capital Mortgage Inc. • Serving California & Tennessee
In this mortgage rates update, we break down weaker job growth, government shutdown risks to loan timelines, and bond strength that could open a path to lower rates - plus clear steps to be lock-ready.
“You’re in charge; do not be distracted by the government bickering. This political grandstanding will pass soon. Work with me to load your pipeline while others are confused about what to do. “
1) Weak Job Growth Is Pressuring Rate Cuts and Mortgage Rates Update:
The latest ADP report showed - 32,000 jobs in September, far below expectations. August was revised down by ~57,000, turning it into a net loss. Wages for job switchers cooled (7.1% → 6.6%), and the 3-, 6-, and 12-month averages all point to a softer labor market. Markets are leaning toward a fall rate cut, with odds building for another by year-end.
Action Step: Plan for a dip
- Situation: Have you noticed how quickly rate expectations are shifting with weaker jobs data?
- Problem Awareness: If rates slip, could waiting to start cost you a better payment?
- Solution Awareness: What would a lower rate do for your monthly budget and price range? If you had a few hundred more to spend every month? Read our mortgage rates update every week.
- Consequence: If you delay until after the drop, more buyers may jump in and reduce your negotiating power.
- Commitment: Schedule a quick consult or start your pre-approval now.
2) Government Shutdown Risk: Processing & Data Delays
A government shutdown can delay federal data releases (BLS Jobs, CPI, PPI, PCE) and slow loan processing where agencies are involved.
VA / FHA / USDA files and loans needing FEMA flood certificates are most exposed. A modest slowdown isn’t fatal - planning ahead matters.
Action Step: Control what you can
- Situation: Were you aware a shutdown can slow some loan types?
- Problem Awareness: How would a delay affect your move-in timeline or rate-lock?
- Solution Awareness: What if your file were fully documented and ready so it moves fastest? Read our mortgage rates update every week.
- Consequence: Imagine finding the right home but losing it because your file isn’t ready.
- Commitment: Start your pre-approval or book a 10-minute plan call.
3) Bonds Breaking Higher: A Path to Lower Rates?
Bond markets rallied after the weak jobs print, with MBS pushing above short-term moving averages and the 10-Year yield drifting lower.
If this holds, mortgage rates could see relief. Purchases remain resilient, and a tactical pre-approval lets you move first when the rate window opens.
Action Step: Be first, not last
- Situation: Have you seen yields slip while headlines still say "rates are high"?
- Problem Awareness: If rates dip, will you be ready to lock before competition returns?
- Solution Awareness: Would a firm pre-approval boost your confidence when making an offer? Read our mortgage rates update every week.
- Consequence: Waiting until after a drop can crowd the field and shrink seller concessions.
- Commitment: Schedule a Consultation • Start Your Pre-Approval
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