Mortgage Rates Demystified: How They’re Set, What Moves Them, and What They Mean in Summit County

In this episode of the Mountain Real Estate Podcast, host Candice Day breaks down the mystery of mortgage rates and why they matter so much for homebuyers and investors in Summit County, Colorado.

You’ll learn:
 ✅ How mortgage rates are actually set (hint: it’s not just the Fed!)
 ✅ The key factors that influence rates — inflation, Treasuries, spreads, and personal borrower details
 ✅ Real-life payment examples on a $1M property at 3%, 6%, 6.25%, and 6.5%
 ✅ How higher rates cut into your purchasing power — and why a $1M home in 2020 might only feel like a $660K home today
 ✅ What current rates look like in Colorado and Summit County, including fixed and adjustable loan options

Whether you’re buying, refinancing, or just curious how mortgage rates affect affordability in the mountains, this episode gives you the clarity you need to navigate today’s market.

📞 Connect with Candice:
 Amy Nakos Group — Summit County, CO
 candice@amynakos.com
 • 303-870-9300
 🌐 amynakos.com

Transcript

Intro
“Welcome to Mountain Real Estate, where we bring you the latest insights on real estate from Denver to Summit County, Colorado. I’m your host, Candice De — a realtor, investor, engineer, mom, and Colorado native.

Today we’re digging into mortgage interest rates. We’ll cover three main things:

1. How mortgage rates are set.
2. What actually moves them — including but not limited to the Federal Reserve rate, which has been a hot topic this September.
3. What the current rate environment looks like here in Summit County and across Colorado.

If you’re buying, refinancing, or just curious how rates affect affordability, this episode should bring you clarity.”

How Mortgage Rates Are Set
“Mortgage rates aren’t chosen at random. Lenders need to cover the cost of their own funds — basically what it costs them to borrow money. To do that, they look at benchmarks like the 10-year U.S. Treasury bond yield, because investors compare Treasuries and mortgages as competing investments.

Here’s the big picture: investors like pension funds, insurance companies, or hedge funds can put money into Treasuries, corporate bonds, stocks, or mortgage-backed securities. Treasuries are considered very safe. So if a 10-year Treasury is yielding 4.5%, investors won’t buy mortgages unless they get a little more return. That extra is called the spread.

For example, if Treasuries are at 4.5%, investors might want 1.5 to 2% more to take on mortgage risk. That pushes 30-year mortgage rates up to around 6 to 6.5%. And if Treasuries rise, mortgage rates usually rise too.

Think of it like shopping: if apples are $1 a pound and pears are $1.50, you’ll only buy pears if you think they’re worth the extra. Mortgages have to be priced attractively compared to Treasuries or investors won’t buy them.

That’s why mortgages move with Treasuries and not directly with the Fed Funds Rate. The Fed influences the environment — inflation, growth, expectations — but your mortgage rate depends on how the bond market values long-term risk.”

Factors That Influence Rates
“So what else affects rates beyond Treasuries and spreads? A lot:

• Inflation expectations: higher inflation pushes yields — and rates — up.
• Economic growth and jobs data: stronger growth usually means higher rates.
• Supply and demand for mortgage-backed securities: strong demand lowers rates; weak demand raises them.
• Borrower factors: your credit score, down payment, debt-to-income, whether it’s a primary or second home.
• Loan structure: 15-year vs. 30-year, fixed vs. adjustable, conforming vs. jumbo.
• Local costs: insurance, property taxes, and property-specific risk.

This is why you can’t just Google “mortgage rate today” and get an exact answer. There are national factors and personal factors layered together.”

Real Numbers Example
“Let’s put this into perspective with real numbers.

Imagine you’re buying a $1 million home in Summit County. You put 20% down, so your loan amount is $800,000.

• Back in 2020, at 3%, your monthly payment was about $3,373.
• At today’s 6%, that jumps to $4,796.
• At 6.25%, it’s $4,925.
• At 6.5%, it climbs to $5,056.

That’s nearly $1,700 more per month — or over $20,000 more per year — for the same property compared to 2020.”

Purchasing Power Translation
“Now, let’s flip that around. Say you were comfortable with that 2020 payment of about $3,373. At today’s 6.5% rate, that same monthly budget only gets you a loan of about $535,000. That means instead of a $1 million home, you’d be shopping closer to $660,000.

This shows how rising rates don’t just change your payment — they change how much house you can afford.”

Current Rates in Summit County
“So where are rates right now?

As of late September 2025:

• 30-year fixed mortgages in Colorado are averaging around 6.1%.
• 15-year fixed loans are around 5.3%.
• I’ve seen adjustable rates locally in the 5.2–5.5% range.

Here in Summit County, jumbo loans and second homes are common, so many buyers see rates between 6.25% and 6.5% depending on credit profile and property type.

And remember — rates move on expectations. For example, before a Fed meeting, if investors think the economy is slowing, the 10-year Treasury might drop and mortgage rates fall, even before the Fed acts.”

Personal Note
“On a personal note, my family has an adjustable-rate mortgage, and we’re now refinancing into a fixed loan. The adjustable gave us lower payments for a few years, but today’s rates look good enough to lock something stable in.”

Wrap-Up
“To summarize:

• Mortgage rates are set by investor demand, Treasury yields, and risk spreads — not just the Fed.
• They’re influenced by inflation, economic data, and your personal credit factors.
• Moving from 3% to 6.5% adds over $20,000 per year in payments on a million-dollar home — or cuts your buying power by more than $300,000.

I’m not a lender or economist, but I work with this every day and partner with excellent lenders who can help you find the best fit. Hopefully, this gave you a clearer picture of where rates come from, what drives them, and what they look like today in Summit County.

Thanks for joining me on Mountain Real Estate. I’m Candice De. If the mountains are calling you, reach out anytime. See you next time.”