US Mortgage Rates Rise to 6.85%, Shifting Buyers Toward Adjustable-Rate Mortgages

Mortgage rates in the United States have risen to 6.85%, prompting a shift in borrower behavior toward adjustable-rate mortgages (ARMs). The increase has dampened overall housing demand, with total mortgage applications falling 2.7% in recent activity.

Refinance applications dropped 6% amid the higher rate environment. The rising costs are pushing homebuyers to seek alternative financing structures as traditional fixed-rate mortgages become more expensive.