On February 18, 2026, the Fed released its latest policy update and kept its benchmark rate unchanged, maintaining the federal funds target range at 3.50% to 3.75%. Two participants preferred a small cut, but the majority held steady. In the Fed’s own language, inflation remains “somewhat elevated.”

So what does that mean for mortgage rates, for buyers in the Richmond area, and for anyone trying to time a lock?

Let’s translate it.

First, what the Fed actually controls (and what it doesn’t)

The Fed directly controls short-term interest rates (the federal funds rate). That rate influences things like:

• credit cards

• home equity lines of credit (HELOCs)

• some auto and personal loans

• bank borrowing costs

But mortgage rates are mostly driven by longer-term market rates, especially the bond market (often the 10-year Treasury) and mortgage-backed securities (MBS). Those move based on expectations: inflation, jobs, growth, and what investors think the Fed will do next.

That’s why you can see mortgage rates rise on a day the Fed holds steady, or fall on a day the Fed sounds tough. Mortgages are forward-looking.

What “held steady” usually signals for mortgage rates

When the Fed holds the benchmark rate steady, it typically means:

1) The market goes back to watching inflation and jobs like a hawk

With no big policy change, mortgage rates often stay choppy, reacting to incoming reports like:

• inflation (CPI, PCE)

• jobs (payrolls, unemployment)

• wage growth

• consumer spending

2) “Somewhat elevated” inflation can keep a floor under rates

When inflation remains sticky, investors tend to demand higher yields to protect purchasing power. That can keep upward pressure on the bond market, which can keep mortgage rates from falling quickly.

3) Dissent matters because it hints at where the debate is going

Even though the Fed didn’t cut, the fact that two participants preferred a small cut is worth noting. It doesn’t guarantee anything, but it can be a sign that the “when do we cut?” conversation is getting louder inside the room.

Why mortgage rates can move even when the Fed doesn’t

This is the part that drives people bananas.

Mortgage rates can move because markets respond to:

• the Fed’s tone (more concerned about inflation vs more concerned about growth)

• investor expectations about future cuts or hikes

• economic data that changes those expectations

• global events that change demand for safer assets like Treasuries

• supply and demand in mortgage-backed securities

So even a “no change” Fed day can still be a big day for rates.

What this means if you’re buying a home soon

If you’re buying in the next 30–90 days, the practical takeaway is simple:

Preparation beats prediction.

Trying to “perfectly time” the market is like trying to catch a greased watermelon. Possible, but most people end up with wet socks.

Instead, you’ll usually have more control over:

• your pre-approval strength

• your documentation readiness

• the structure of your offer (clean terms, timeline, contingencies)

• your rate lock strategy tied to your closing date

In a volatile rate environment, strong prep can also prevent last-minute underwriting conditions that slow things down.

Lock vs float: how we think about it

A lock isn’t just a guess. It’s a risk decision based on your timeline.

Here’s a simple framework we use:

If your closing date is close (generally within 15–30 days)

Locking can make sense because there’s less time to benefit from any improvement, and more chance of a surprise bump.

If your closing date is further out (45–90+ days)

You may have more flexibility, but your best move depends on:

• how sensitive your payment is to rate changes

• whether you can sleep at night if rates rise

• whether you have a backup plan (extended lock, float-down option, etc.)

The right answer isn’t universal. It’s personal to the file.

What this means if you’re refinancing

Refinancing is more rate-driven, so the big question is:

What rate would make it worth it for you?

For some homeowners, it’s about lowering the payment. For others it’s about:

• eliminating mortgage insurance

• shortening the term

• switching from ARM to fixed

• pulling cash out strategically (not casually)

Refi opportunities tend to show up in waves, so having your numbers ready can help you move quickly if a favorable window opens.

One more factor people forget: the “cost” side of the rate

Even if rates dip, the best deal isn’t always the lowest rate headline. Pricing includes:

• discount points (paid upfront to buy down the rate)

• lender credits (used to offset closing costs)

• program and occupancy details

• credit score and loan-to-value impacts

That’s why it’s smart to compare options based on your expected time in the home and the break-even point, not just the rate number.

The bottom line

The Fed’s Feb 18, 2026 update kept benchmark rates unchanged, noted inflation remains “somewhat elevated,” and included two dissenting votes favoring a small cut.

For mortgage rates, this usually means continued day-to-day movement as the market reacts to incoming economic data and shifting expectations.

And for buyers: the winners are usually the ones who show up prepared, with clean terms and a lock plan that matches the closing date.

Ready for a clear next step?

If you’re buying or refinancing in the Richmond area, we can help you make sense of the current market and choose a strategy that fits your timeline.

Call or message us with your target closing date, and we’ll send back a same-day lock vs float recommendation plus a payment estimate.

Dream House Virginia
Mortgage Broker Near Richmond, VA

Disclaimer: This article is for informational purposes only and is not financial advice. Mortgage rates and availability change frequently and vary by borrower profile and loan program.