Mortgage Rates Hit 7.28%. What That Number Means (and Doesn't) for a Self-Employed Veteran

The 30-year fixed mortgage rate averaged 7.28% on October 1, 2026, according to Freddie Mac. That’s up from 7.03% the week before and 6.34% a year ago, and it’s the highest reading since November 2023. Veterans are going to see that number and assume it’s their rate. It isn’t.

Rates are individual, and nothing here is a quote. But if you’re a veteran who owns a business, the headline matters less to you than two other things, and neither one made the news.

What happened to mortgage rates this week?

Rates jumped 25 basis points in a single week. The Associated Press reported it was the biggest weekly climb since October 2022, and the sixth straight weekly increase. The 10-year Treasury yield, which mortgage rates loosely follow, spiked to about 5.27%.

On a $400,000 loan, the difference between a 6.34% note and a 7.28% note is roughly $251 a month in principal and interest. That’s my own arithmetic, a hypothetical, not a payment anyone is offering. Freddie Mac and the AP are reporting the same weekly survey, so I treat them as one source, not two. Bloomberg’s headline on the same release matches the figure.

Is the Freddie Mac rate the rate a VA borrower gets?

No. Freddie’s survey covers conventional, conforming purchase loans for borrowers with 20% down and excellent credit, and it says so in the methodology.

A VA buyer is a different file. VA loans can be done with nothing down, and they don’t carry monthly mortgage insurance. A conventional buyer with 5% down at the same note rate is paying PMI on top of it. So the comparison that matters isn’t note rate against note rate. It’s total monthly cost, including the VA funding fee that’s usually financed. I covered how that fee works in VA Funding Fee: What It Is and What It Is Not, and veterans with a service-connected disability rating are exempt from it, according to VA.

Also worth knowing: with full entitlement, VA says it doesn’t set a county loan limit on how much you can borrow. Lenders still set their own limits and down payment expectations on larger loans, so don’t read that as unlimited.

The edge: VA doesn’t fix the tax return problem

Here’s what the rate coverage won’t tell a veteran business owner. A VA loan solves the down payment. It doesn’t solve the income problem.

In my experience, lenders underwrite self-employed VA borrowers the way conventional lenders do. They typically want two years of personal and business returns, plus a year-to-date profit and loss statement, and they qualify you on net income after write-offs. I couldn’t pull VA’s own handbook chapter in a form I could cite, so treat that as how lenders generally work in my experience, not a quote from VA.

So the veteran with $60,000 of real profit who wrote it down to $25,000 on paper with a good CPA has the same wall as everyone else. Zero down doesn’t help if the income doesn’t qualify. My earlier post on how tax write-offs shrink your qualifying income walks through that math.

The pitfall I see: skipping the cheapest valid option

This is a hypothetical, but it’s a pattern I see a lot.

A veteran owns a landscaping company. He has VA entitlement he’s never used and two years of returns. He calls a loan officer, says “self-employed,” and gets pushed straight to a bank statement loan. Nobody reads the returns. The rate is higher, the down payment is bigger, and he never finds out whether a VA loan with his returns would have worked, or whether a conventional or one-year-return option would have fit.

The order matters. Read the returns first. Check VA, then conventional. Look at add-backs like depreciation, which can raise qualifying income on paper. Use bank statements only when the returns genuinely don’t work. That’s not the most profitable path for a broker. It’s the right one.

A simple worked example

Same $400,000 hypothetical loan, three different pictures of one veteran’s file:

• Returns support the income: VA or conventional with returns is on the table. Compare total monthly cost, not note rates.
• Returns fall short by a small margin: add-backs or a stronger year-to-date P&L may close the gap. Ask early.
• Returns fall well short: bank statement programs look at deposits instead. Expect a different rate and reserve structure, and expect it to be a different set of rules, not no rules.

What to do before you price anything

1. Pull your last two years of personal and business returns and find the net income line, not revenue.
2. Ask whoever you’re talking to which programs they ran your returns through, and in what order.
3. Check your VA entitlement before assuming it’s fully available. Previous use that wasn’t restored can change the math, and I go through the basics in VA Loan Benefits.
4. Ask for total monthly cost, including mortgage insurance, funding fee and taxes, not just a rate.
5. Don’t wait for rates to fall to run the numbers. Qualifying income, not the rate, decides whether you can buy.

I’m a mortgage broker with NEXA Lending, and I work with borrowers all over North Carolina and Virginia, including the Charlotte area and Lake Norman. As a broker, I can shop your loan across a wide network of lenders instead of being stuck with one bank’s programs. Send me your returns and your price range, and I’ll tell you which program fits first. Programs, rates and approval depend on your full file, and individual rates vary.

Sources: Freddie Mac, Mortgage Rates Average 7.28% (Oct. 1, 2026) (opens in a new tab), Freddie Mac PMMS archive (opens in a new tab), Associated Press via Iron Mountain Daily News (opens in a new tab), Bloomberg (opens in a new tab), VA loan limits (opens in a new tab), VA funding fee (opens in a new tab).