USA mortgage rates enter "treacherous" territory, highest end hits 7.18% - Americans to pay $11b more in interest from 2024 to bank lenders

An analysis done by Tomo mortgage looked at 1 million mortgage agreements in the US from 1000 different vendors. They found two things. Rates are increasing and Americans are set to pay much more in interest to credit unions, banks, and other lenders. And more interestingly, the disparity and gap between the best rate providers and the worst rate providers is growing.

Axios Felix Salmon covered this as well and stated that the highest rates are hitting "treacherous" terriority, with some rates surpassing the 7% mark. This would likely translate to existing mortgage holders who locked in a 2% or lower rate during the pandemic from moving, golden handcuffs. This would restrict existing housing supply, while new housing supply lacks the demand to build - the current range of 6.3%-7.18% doesn't seem very attractive for new home buyers to enter the market.

What's unclear is if lack of mortgage volume times high rates will lead to higher profits for the lenders of credit unions or banks compared to high mortgage volume with low rates.

[https://tomo.com/blog/wp-content/uploads/2025/04/The-Truth-About-Mortgage-Rates.pdf](https://tomo.com/blog/wp-content/uploads/2025/04/The-Truth-About-Mortgage-Rates.pdf)

[https://www.axios.com/2025/05/02/mortgage-housing-rates](https://www.axios.com/2025/05/02/mortgage-housing-rates)