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Mortgage rates hit 7.49%, the highest in almost three years, and FHA buyers pulled back the most: FHA purchase applications fell 6% in one week. If you are a first-time home buyer in Denver, Aurora or Colorado Springs using an FHA loan, here is what a 7.49% mortgage rate costs and how Colorado buyers still get into a home this fall.
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7.49% 30-year fixed contract rate Mortgage Bankers Association, week ending Oct 2, 2026 | -6% FHA purchase applications Biggest drop of any loan type that week |
-15% Purchase applications vs a year ago Fewer buyers in the market | 10.3% Share choosing an ARM Buyers chasing a lower first payment |
Why two different mortgage rates are in the news
7.49% is the Mortgage Bankers Association's average contract rate. 7.28% is Freddie Mac's weekly average. Both measured the week of October 1 and 2, 2026, with different surveys. Both say the same thing: rates are about a full point higher than a year ago. Your own rate depends on your credit, down payment and points.
What 7.49% costs on an FHA loan in Colorado
On a $400,000 FHA loan, the principal and interest payment is $2,794 a month at 7.49% and $2,661 at 7.00%. That is $133 a month for half a point. FHA mortgage insurance adds to the payment on top. Read what half a point of rate costs and run your budget with can I afford a home now.
| 30-year rate | $300,000 loan | $400,000 loan |
|---|---|---|
| 7.00% | $1,996 | $2,661 |
| 7.28% | $2,053 | $2,737 |
| 7.49% | $2,096 | $2,794 |
How Colorado FHA buyers win at 7.49%
- Ask the seller to pay a rate buydown. 36% of Denver listings cut their price in August. Sellers pay buydowns and closing costs. See seller concessions in Colorado.
- Use down payment assistance. The $1,000 cash-to-close program and CHFA down payment assistance cover the cash.
- Assume a seller's lower rate. FHA loans are assumable. See assumable mortgage homes.
- Shop the homes that pass FHA. See Denver FHA-eligible homes and Aurora FHA-eligible homes.
Should you take an ARM?
Only if you can carry the payment after it resets. 10.3% of buyers picked an adjustable-rate loan that week. A 5/1 ARM starting at 6.0% on $400,000 is $2,398 a month. If it resets 2 points higher in year 6, the payment is $2,873. Qualify for the reset payment, not the teaser.
