How VA Mortgage Rates Move: What Solano County Buyers Should Watch in 2026

Last updated April 12, 2026 by Tim Stacey, Stacey Solutions powered by Xpert Home Lending, Inc NMLS 2179191.

VA Rates Are Tied to the Bond Market, Not the Fed Funds Rate

One of the most common misconceptions I hear from buyers is that mortgage rates move directly with the Federal Reserve’s rate decisions. The Fed funds rate influences short-term borrowing costs like credit card rates and HELOCs. Mortgage rates are more closely tied to the yield on the 10-year Treasury bond.

When investors buy more Treasury bonds, yields drop and mortgage rates tend to follow. When investors sell bonds or demand higher yields because of inflation concerns, mortgage rates rise. This is why mortgage rates sometimes move in the opposite direction of what the Fed does.

Why VA Rates Are Typically Lower Than Conventional Rates

VA loans carry a government guarantee that covers a portion of the loan if the borrower defaults. This guarantee reduces the lender’s risk, which translates to lower rates for the borrower. Historically, VA rates have been 0.25 to 0.50 percent below comparable conventional rates.

On a $600,000 loan, a quarter-point rate advantage saves about $90 per month. Over 30 years, that adds up to more than $32,000 in interest savings. This rate advantage is one of the most valuable and underappreciated parts of the VA loan benefit.

What Economic Indicators to Watch

Several economic data releases move mortgage rates week to week. The monthly jobs report is one of the biggest rate movers. Strong job growth tends to push rates up because it signals economic strength and potential inflation. Weak job numbers can push rates down.

The Consumer Price Index and Personal Consumption Expenditures reports measure inflation. Rising inflation is the enemy of low mortgage rates because it erodes the value of the fixed payments investors receive from mortgage-backed securities.

Federal Reserve meeting announcements and the minutes from those meetings also move rates, especially when the Fed signals a change in monetary policy direction. Even the language the Fed uses in its statements can cause rate movement.

Global events like geopolitical conflicts, trade disputes, or financial crises in other countries can push investors toward the safety of U.S. bonds, which drives yields down and mortgage rates with them.

When to Lock Your VA Loan Rate

A rate lock guarantees your interest rate for a specific period, typically 30 to 60 days. Once locked, your rate does not change even if market rates go up before you close.

The best time to lock depends on market conditions and your closing timeline. If rates are trending upward and you are under contract, locking early protects you from further increases. If rates are dropping, you might float for a few days to capture the improvement, though this carries risk.

I monitor rate movements daily and advise every client on lock timing based on their specific timeline and risk tolerance. For Travis AFB families on a PCS schedule with a hard closing deadline, I almost always recommend locking as soon as we have a ratified contract.

Factors in Your Control That Affect Your Rate

While you cannot control the bond market, several factors within your control directly impact the rate you receive. Your credit score is the biggest one. A 740 or higher score puts you in the best pricing tier. Between 680 and 739, you see moderate adjustments. Below 680, the impact on pricing becomes more significant.

The loan-to-value ratio matters on refinances. More equity means lower risk for the lender, which translates to a better rate. On purchases, the VA zero-down option still receives competitive pricing because of the government guarantee.

Choosing to pay discount points can buy down your rate. One point (1 percent of the loan amount) typically reduces your rate by about 0.25 percent. On a $500,000 loan, one point costs $5,000 and saves approximately $75 per month. If you keep the loan for more than about 67 months, the point pays for itself.

Frequently Asked Questions

Do VA loan rates change daily?

Yes. VA loan rates can change multiple times per day based on bond market movement. The rate you are quoted in the morning may differ from the rate available in the afternoon if a significant economic report is released or market conditions shift.

Can I negotiate my VA loan rate?

Rates are market-driven, but the margin your lender adds is somewhat negotiable. Working with a broker who has access to multiple wholesale lenders gives you the best chance of finding competitive pricing. Comparing offers from two to three lenders is the most effective way to ensure you are getting a fair rate.

Should I wait for rates to drop before buying?

Trying to time mortgage rates is like timing the stock market. Nobody consistently gets it right. If you can afford the payment at today’s rate and you find the right home, buying now and refinancing later if rates drop is usually a better strategy than waiting indefinitely for a rate environment that may or may not materialize.

What is a float-down option?

Some lenders offer a float-down provision that allows you to take advantage of a lower rate if rates drop after you lock. Float-downs usually have conditions, like the rate must drop by at least 0.25 percent, and there may be a fee. Ask your lender if this option is available before you lock.

Are VA adjustable-rate mortgages a good option?

VA ARMs can offer a lower initial rate than fixed-rate loans, which makes them attractive if you plan to sell or refinance within five to seven years. The VA ARM has rate adjustment caps that limit how much your rate can change per period and over the life of the loan. For active-duty families at Travis AFB who may PCS in a few years, a VA ARM can be a smart strategy.

Get Today’s VA Rate for Your Situation

Published rate averages do not tell you what your specific rate will be. That depends on your credit, loan amount, and timing. I provide personalized rate quotes to veterans and active-duty buyers across Vacaville, Fairfield, Suisun City, and the entire Solano County area. Reach out and I will show you exactly where rates stand for your scenario today.