New York, Jan 21, 2026, 03:21 (EST)
- The 30-year fixed mortgage rate rebounds, rising 14 basis points to 6.21% after slipping recently
- Tariff threats linked to Greenland send bond yields climbing, triggering fresh swings in rates
- The spike puts the White House’s $200 billion mortgage-bond buying plan under pressure
U.S. mortgage rates jumped Tuesday, unsettled by tariff headlines and geopolitical unrest triggered by President Donald Trump’s attempt to buy Greenland, sending ripples through bond markets.
The average 30-year fixed mortgage rate for top-tier loans rose by 14 basis points to 6.21%, according to Mortgage News Daily. 1
This shift matters because borrowers were just starting to see some relief, coinciding with the housing market’s typical spring upswing.
With prices elevated and most buyers relying on financing, even small shifts can swiftly drive monthly payments higher.
Rates jumped briefly to 5.99% on Jan. 9, then settled back into the low 6% range last week, Mortgage News Daily reported.
The administration’s $200 billion plan to buy mortgage-backed securities—bonds linked to home loans from Fannie Mae and Freddie Mac—is now being put to the test. The Federal Housing Finance Agency kicked off the effort with a $3 billion purchase, Reuters reports. 2
The bond market took a sharp turn following Trump’s warning about new tariffs aimed at European countries backing Denmark on Greenland.
He said tariffs would kick in at 10% starting Feb. 1, then rise to 25% by June 1—unless the U.S. clinches a deal to buy Greenland, Reuters reported. 3
Benchmark Treasury yields edged up to about 4.275% on Tuesday, marking their highest level since early September, Mortgage Professional America reported.
Kaspar Hense, senior portfolio manager at BlueBay Fixed Income, warned that escalating tensions over Greenland could push EU investors to offload U.S. government bonds. He also highlighted the threat of rising interest rates globally. 4
Krishna Guha, head of global policy and central banking strategy at Evercore ISI, was blunt: “This is ‘sell America’ again within a much broader global risk off,” he wrote.
Mortgage News Daily pointed out that Tuesday’s rate matched the level from just before the White House announced its mortgage-bond buying program, indicating that the initial lift was largely baked in already.
Unlike earlier Fed quantitative easing efforts, the White House’s plan doesn’t come with a set schedule, leaving investors to react in real time. 5
Trump’s visit to the World Economic Forum in Davos is drawing market attention, but Greenland is poised to steal the show on the sidelines.
“Today is a good day to see if the White House’s mortgage-backed security purchase game plan works,” said Logan Mohtashami, lead analyst at HousingWire.
“The past week has brought an unusually high level of noise,” said Jeff DerGurahian, chief investment officer and head economist at loanDepot, pointing to its impact on pushing Treasury and mortgage rates higher. 6
Mortgage rates dropped last week, driving a 28.5% surge in total application volumes compared to the week before, according to the Mortgage Bankers Association. Borrowers are moving, showing renewed interest in refinancing.
Freddie Mac said the average 30-year fixed mortgage rate dropped to 6.06% for the week ending Jan. 15, its lowest since September 2022. That’s a significant fall from 7.04% a year earlier. 7
To keep sales moving, builders are boosting incentives such as mortgage rate buydowns, covering upfront costs to lower buyers’ interest rates. But these moves are tightening profit margins.
“We ramped up the use of those incentives over the quarter,” D.R. Horton said on its post-earnings call.
The homebuilder exceeded quarterly profit expectations on Tuesday but warned that higher incentives are likely to weigh on gross margins, Reuters reported. 8
The road ahead is still unclear. Mortgage News Daily warned it’s premature to say if Tuesday’s jump marks a bigger shift, pointing to upcoming economic data and the continuing Greenland dispute as key factors.
With many homeowners locked into mortgages at rates well below today’s, listings are expected to stay scarce. Refinancing won’t gain momentum unless rates plunge substantially.
This week, a Forbes.com column looked beyond home buying, arguing that cheaper borrowing can alter household budgets and even reshape long-term financial strategies. 9
