What if you could sell your home without saying goodbye to your 3% mortgage rate?
Cassie French August 25, 2026
Cassie French August 25, 2026
If you own a home with a 3% mortgage rate, congratulations—you are sitting on one of the most valuable financial souvenirs of the pandemic era. You may also feel as if you can never move again.
That is the dilemma facing many Orange County homeowners. Their current interest rate is fantastic, but their home no longer fits their life. They may need another bedroom, a downstairs primary suite, a shorter commute or a completely different neighborhood. Empty nesters may want to downsize, while growing families need more space. Yet selling a home with a 3% rate and buying a house with a mortgage rate in the sixes can increase the monthly payment dramatically.
This is commonly called the mortgage-rate “lock-in effect,” and it is one of the problems the proposed MOVE Act is intended to address.
MOVE stands for the Making Ownership Viable for Everyone Act. The proposed federal legislation would require Fannie Mae and Freddie Mac to begin purchasing and securitizing certain portable conventional mortgages. In simple terms, a portable mortgage could allow a qualifying homeowner to sell one property and transfer the existing mortgage’s:
to a new property. The current draft says the transfer would need to take place within 90 days after the original property is sold.
That could mean a homeowner with a 3% mortgage would not necessarily have to surrender that rate simply because they move. Instead, the existing loan could potentially follow the homeowner to the next qualifying property. Which is great news for Orange County homeowners!
There is one very important disclaimer: the MOVE Act is proposed legislation, not current law. Portable mortgages are not suddenly available to every homeowner, and the proposal does not guarantee that every existing conventional mortgage would qualify. The final rules, underwriting requirements and implementation details would matter enormously.
A low interest rate can save a homeowner thousands of dollars each year. According to Freddie Mac, the average 30-year fixed mortgage rate was approximately 6.65% as of August 20, 2026. That creates a significant financial gap between homeowners who financed or refinanced near 3% and buyers borrowing at current rates.
For a simplified comparison, the principal-and-interest payment on an $800,000, 30-year loan would be approximately:
That comparison does not include property taxes, homeowners insurance, HOA dues or other costs, but it illustrates why homeowners hesitate to give up a low rate—even when their current house is no longer right for them.
The lock-in effect does not only affect individual homeowners. FHFA research found that mortgage-rate lock-in reduced sales involving fixed-rate mortgages and prevented an estimated 1.33 million home sales nationally between the second quarter of 2022 and the fourth quarter of 2023. Approximately 80,000–90,000 Orange County mortgages below 3%. Because California experienced heavy refinancing during 2020–2021 and appears to retain a particularly large low-rate population, a reasonable working range is 80,000–100,000 Orange County homeowners with mortgage rates around 3% or lower. When homeowners stay put, fewer properties reach the market, buyers have fewer choices and the limited supply can place additional pressure on prices.
Imagine an Orange County couple purchased their home several years ago and still owes $800,000 at a 3% interest rate. They now have two children, both parents work from home and their three-bedroom house feels smaller by the day. They want to sell and buy a larger home for $1.6 million.
Under today’s typical process, their existing mortgage would be paid off when they sell. After applying their sale proceeds and down payment, they would finance the remaining purchase at the rate available when they buy.
If their existing mortgage qualified as portable under a future version of the MOVE Act, they could potentially transfer the $800,000 remaining balance, 3% rate and remaining loan term to the new property. If they needed to borrow additional money beyond that portable balance, the additional amount would likely require separate financing at then-current terms, subject to the eventual program rules and lender approval.
The proposal would not necessarily give them a 3% rate on the entire $1.6 million purchase. It could, however, preserve the low rate on the qualifying $800,000 balance. That difference could make moving financially possible—or at least far more comfortable.
The homeowner would still need to qualify. The new property would need to satisfy appraisal and lending requirements, and the buyer would still need enough equity, cash or additional financing to complete the purchase. Property taxes, insurance and HOA expenses could also change.
The potential impact on Orange County real estate could be significant because local homeowners often have substantial equity, large mortgage balances and an equally large financial incentive to keep their low rates.
Some homeowners are not staying because they love their current property. They are staying because the payment on their next home feels unreasonable. If qualifying homeowners could preserve an existing low rate, more move-up sellers, downsizers and relocating owners might enter the market.
Every homeowner who lists a property creates a new opportunity for someone else who is buying a house. More listings could give buyers greater choice among neighborhoods, architectural styles, lot sizes and price points.
Orange County homeowners frequently have considerable equity but still face payment shock when comparing their current mortgage with the cost of a new loan. A portable mortgage could allow them to combine that equity with the benefit of their existing financing.
More inventory may reduce some of the pressure created by the lock-in effect. However, portable mortgages could also bring more buyers into the market because existing homeowners would feel more comfortable moving. If both supply and demand increase, the effect on Orange County home prices would depend on the neighborhood, price range and number of participating homeowners.
In other words, the MOVE Act could create more movement without guaranteeing lower prices.
Probably not, based on the current proposal.
The draft focuses on qualifying conventional mortgages that meet Fannie Mae or Freddie Mac purchase and securitization requirements. That distinction matters in Orange County, where many homeowners use jumbo financing.
For 2026, the conforming loan ceiling for a one-unit home in a high-cost area is $1,249,125. A mortgage above the applicable conforming limit is generally considered a jumbo loan and may fall outside the proposal as currently written. The final eligibility rules would need to clarify which existing loans could be transferred, how lenders would underwrite the new property and how supplemental financing would work.
Homeowners should not assume that the proposal would:
California homeowners should also evaluate the property-tax consequences of a move. Some eligible homeowners may be able to transfer a taxable value under Proposition 19, but that is a separate program with its own requirements.
The MOVE Act is worth watching, especially if your mortgage rate is the primary reason you have postponed a move. But it is too early to make a real estate decision based on the proposal alone.
Homeowners can still prepare by reviewing:
A personalized move-up analysis can be far more revealing than comparing interest rates alone. In some cases, a homeowner’s equity, a negotiated purchase price or seller-paid financing concessions may already help bridge the gap. In other cases, waiting may be the better financial decision.
The proposed MOVE Act could address one of the biggest obstacles in today’s housing market: homeowners who want or need to move but feel financially handcuffed to a 3% mortgage.
If portable mortgages become widely available, qualifying homeowners may be able to carry an existing mortgage balance, rate and terms to a new property instead of starting from scratch. For Orange County real estate, that could encourage more homeowners to list, create additional options for buyers and help families move into homes that better fit the next stage of their lives.
However, the proposal is not yet law, and major questions remain—particularly for Orange County homeowners with jumbo loans or those purchasing a substantially more expensive property.
If your low interest rate is keeping you in a home that no longer works for you, contact Cassie French for a personalized Orange County real estate analysis. We can compare your current payment, estimated equity, potential sale proceeds and the cost of buying a house under several financing scenarios—so you can understand your options before making your next move.
This article is for general informational purposes only and is not legal, tax, lending or financial advice. Proposed legislation may change or may not become law. Consult qualified professionals regarding your particular circumstances.
Cassie French
Cassie French is a top real estate agent serving Newport Beach and North Tustin, specializing in helping homeowners maximize their home's value through strategic preparation, expert staging, and results-driven marketing. As a member of The Agency Orange County and owner of Classy AF Interiors, she combines real estate expertise with professional design experience to position homes for stronger buyer demand and top-dollar sales. With a hands-on, client-first approach and experience renovating over 100 homes, Cassie is trusted for her market knowledge, attention to detail, and proven ability to deliver exceptional results for sellers.
Enthusiastic, upbeat, and energetic, Cassie French's passion for the Newport Beach & North Tustin community shines through every interaction and transaction. Part of The Agency Orange County, Cassie's fresh perspective pairs beautifully with her commitment to excellence and extensive knowledge of the area to provide clients with unmatched guidance and care.
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