If you’re a military family thinking about buying a home, you shouldn’t need a degree in economics to understand what’s happening with mortgage rates.
So let’s skip the Wall Street jargon and talk about what happened this week, and why it matters to you.
The Economy
The biggest news this week came from the job market.
The U.S. economy lost 23,000 jobs in July. Economists had expected the country to add jobs, so this caught the financial markets by surprise.
There was more.
The government also went back and revised the May and June numbers. Together, those two months produced 103,000 fewer jobs than originally reported.
Wages are still growing, but more slowly. Average wages are up 3.2% from a year ago, the slowest pace we’ve seen in several years.
The unemployment rate actually dipped slightly to 4.1%, but that’s not quite as encouraging as it sounds. Part of the reason is that fewer Americans are participating in the workforce.
In plain English:
The job market appears to be losing some steam.
That’s not necessarily great news for the economy, but strangely enough, it can be good news for mortgage rates.
The Mortgage Market
Here’s where things get interesting.
Mortgage rates don’t simply move because the Federal Reserve raises or lowers interest rates. They react to what investors believe is coming next, inflation, economic growth, jobs, oil prices, and Federal Reserve decisions.
This week’s weak jobs report made investors think the economy may be slowing.
That pushed an important market interest rate, the 10-year U.S. Treasury yield, lower. Mortgage rates tend to move in the same general direction.
So when the jobs report came out Friday morning, the pressure on mortgage rates moved downward.
That’s encouraging.
But don’t confuse “rates moved lower” with “rates are about to collapse.”
We’re not there.
Inflation is still a concern. Oil prices remain unpredictable because of tensions in the Middle East. And next week’s inflation report could move rates again very quickly.
That’s why we’re likely to continue seeing mortgage rates bounce around rather than move steadily in one direction.
What It Means for Military Families
If you’re using your VA home loan benefit, this is where I want you to pay attention.
Don’t try to perfectly time the mortgage market.
Nobody can.
Instead, ask a much simpler question:
Can I comfortably afford the home and payment today?
If the answer is yes, buying a home may make sense even if rates aren’t where you wish they were.
Remember, a mortgage rate isn’t necessarily permanent. If rates fall significantly later, refinancing may become an option.
But the home you want, in the neighborhood you want, at a price you can afford may not still be available.
There is another reason today’s market deserves attention.
Higher mortgage rates have forced some buyers to the sidelines. That can mean less competition for the military family who is financially prepared to buy.
And military families may have more help available than they realize.
Beyond the VA Loan: The Hometown Hero Credit
The VA home loan is an incredible benefit earned through military service. For eligible borrowers, it can provide 0% down financing without monthly private mortgage insurance.
But your VA benefits may not be the only help available.
Through Operation T.A.G. (Tangible Act of Gratitude) and our partnership with PRMG, eligible veterans, active-duty service members, and Gold Star surviving spouses may also qualify for the Hometown Hero Credit.
The Hometown Hero Credit is a non-profit program designed to support our military community. It provides a 2% credit up to $21,000 to help military families buy or refinance a home.
How the Hometown Hero Credit Can Be Used
It is important to understand how these funds can be applied:
- Pay closing fees and eligible transaction costs.
- Buy down the interest rate for more affordable monthly payments.
- Pay real estate agent fees.
- In some cases, pay down existing debt to help with VA loan qualification.
Note: The 2% credit is calculated on the loan amount, not the sales price. Please keep in mind that the credit cannot be used for down payments or for non-loan purposes. Furthermore, because VA loans generally do not require a down payment, combining your zero-down VA financing with this credit makes homeownership remarkably accessible.
There is no second mortgage and no repayment of the credit.
Why does that matter?
Because coming up with a down payment isn’t the only challenge when buying a home. Closing costs and other expenses can still add up: even when you’re using a VA loan.
Combining the benefits of VA financing with the Hometown Hero Credit can make homeownership considerably more attainable for a military family.
That’s exactly why the program exists.
Military service deserves more than a “Thank you for your service.” It deserves a tangible act of gratitude.
What We’re Watching Next
Next week could be important.
- Tuesday: We’ll get new information about existing-home sales.
- Wednesday: We’ll get the Consumer Price Index (CPI), which tells us how quickly consumer prices are rising.
- Thursday: Another inflation report will tell us what’s happening with prices businesses pay.
- Friday: We’ll see how much Americans are spending at stores, restaurants, and online.
Why should a military family care about any of that?
Because these reports can influence mortgage rates.
- Lower inflation and a slowing economy could help rates move lower.
- Higher inflation could push them right back up.
The Bottom Line
This week’s message is pretty simple:
👉 The job market was considerably weaker than expected.
👉 That helped mortgage rates move in the right direction.
👉 But one good day doesn’t create a trend.
👉 Inflation and events in the Middle East could still move rates quickly.
👉 Military families may have more homebuying assistance available than they realize.
For military families considering homeownership, don’t spend your time trying to predict the perfect rate.
Know your benefits. Know your budget. Know your options. And be ready when the right opportunity comes along.
And before assuming you can’t afford to buy a home, find out what you’ve actually earned through your service: and what additional programs may be available to help.
Claim Your Free E-Book
Want to learn more about navigating your military homeownership journey? Scan or click below to access our free Mission Homeownership e-book:
Brett Stacy
National Director & Founder of the Hometown Hero Credit, a program of Operation T.A.G. (Tangible Act of Gratitude), and 501(c)(3) non-profit project of HDCF.
Websites: www.OperationTAG.org and www.HometownHeroCredit.com
Phone: 760-456-8748 (24-hour Information Line)
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