Today's mortgage and refinance rates
Average mortgage rates fell yesterday. And conventional loans started this morning at 3.063% (3.063% APR) for a 30 year fixed rate mortgage.
This morning's outlook has not changed at all from yesterday's. Mortgage rates appear to be lower today again. But Events on Capitol Hill could easily send them higher.
Find and Block a Low Rate (December 12, 2020)
Current mortgage and refinancing rates
Conventional 30 years fixed
Conventional 15 years fixed
Conventional 5-year ARM
Fixed FTA for 30 years
Fixed FTA for 15 years
5 years ARM FHA
30 years permanent VA
15 years fixed VA
5 years ARM VA
Prices are provided by our partner network and may not reflect the market. Your rate could be different. Click here for a personalized price offer. See our tariff assumptions here.
Find and Block a Low Rate (December 12, 2020)
COVID-19 Mortgage Updates: Mortgage lenders are changing interest rates and rules due to COVID-19. For the latest information on the impact of Coronavirus on your home loan, click here.
Should You Lock A Mortgage Rate Today?
In the short term, mortgage rates could rise slightly today or later this week. If they do, it will likely be because DC politicians agreed to a stimulus package – or at least preventing the government lockdown due Friday night.
So if you are about to close, you might want to lock up now – unless your trust in the people of the country's capital is very low indeed. Further up, further small falls seem likely to me.
It's up to you if you wait for those, hoping that I'm right. Keep in mind, however, that these rates are currently very close to a new all-time low. Is it worth the risk?
See “Are Mortgage and Refinance Rates Going Up or Down?” (Below) for more details. In the meantime, my personal recommendations on tariff blocking are:
LOCK when you approach 7th DaysLOCK when you approach 15th DaysHOVER when you approach 30th DaysHOVER when you approach 45 DaysHOVER when you approach 60 Days
But with so much uncertainty right now, your instincts could easily turn out to be as good as mine – or better. So let your gut and your personal risk tolerance guide you.
Market Data Affecting Mortgage Rates Today
Here is the current status at 9:50 a.m. (ET) this morning. The dates, compared to roughly the same time yesterday morning, were:
The 10-year Treasury yield fell from 0.94% to 0.90%. (Good for mortgage ratesMore than any other market, mortgage rates usually tend to follow these particular government bond yields, albeit more recentlyImportant stock indices were mostly lower when opened. (Good for mortgage rates.Often times, when investors buy stocks, they sell bonds, which lowers the prices of those bonds and increases yields and mortgage rates. The opposite is true when the indices are lower. Oil prices fell to $ 45.66 from $ 45.72 a barrel. (Neutral for mortgage rates * because energy prices play a major role in causing inflation and also indicate future economic activity.) Gold prices rose from $ 1,850 per ounce to $ 1,876. (Good for mortgage rates*.) In general, it is better for interest rates when gold rises and worse for interest rates when gold falls. Gold tends to rise when investors worry about the economy. And worried investors tend to cut rates. CNN Business Fear & Greed Index – Postponed to 80 out of 88 out of 100. (Good for mortgage interest.) "Greedy" investors push bond prices down (and interest rates up) when they exit the bond market and invest in stocks, while "fearful" investors do the opposite. Lower readings are therefore better than higher ones
* A change of less than $ 20 in gold prices or 40 cents in oil prices is a fraction of 1%. Hence, we only count significant differences as good or bad for mortgage rates.
Reservations about markets and prices
Before the pandemic and the Federal Reserve's intervention in the mortgage market, you could look at the numbers above and get a pretty good idea of what would happen to mortgage rates that day. However, this is no longer the case. The Fed is a big player now and a few days can overwhelm investor sentiment.
Use markets only as a rough guide. They have to be exceptionally strong (rates are likely to rise) or weak (they could fall) to be relied on. But so far they have been searching with this restriction a bit better for mortgage rates today. There are, however a good chance that won't last.
Find and Block a Low Rate (December 12, 2020)
Important Notes About Today's Mortgage Rates
Here are some things you need to know:
The continued intervention of the Fed in the mortgage market (well over $ 1 trillion) should continue to put pressure on these rates. But it can't always work miracles. So expect both short-term increases and decreases. And read: “For once, the Fed affects mortgage rates. Here's why: "If you want to understand this aspect of what is happening, mortgage rates usually go up when the economy is doing well and go down when they're in trouble." There are exceptions, however. Read about how mortgage rates are determined and why you should care. Only top notch borrowers (with great credit scores, high down payments, and very healthy finances) will get the ultra-low mortgage rates for which the listed lenders vary. Yours may or may not follow the crowd when it comes to daily interest rate movements – though they usually all follow the broader trend over time. When interest rate changes are small, some lenders adjust closing costs and leave their interest rate cards the same for purchases. However, some types of Fannie Mae and Freddie Mac refinancing are currently significantly higher after a change in regulations
So there is a lot going on here. And no one can claim to know for sure what will happen to mortgage rates in the coming hours, days, weeks, or months.
Are mortgage and refinancing rates rising or falling?
Perhaps we should start with a remark made yesterday in Mortgage News Daily:
But mortgage rates are here to tell you that 2020 is different. They break all the old rules and make their own.
– Mortgage rates living their own life by their own rules, Matthew Graham, December 7, 2020
The message of this is that people like me are much less reliable in predicting the direction of mortgage rates than we (maybe) once do. And that's probably true.
But I'm still pretty confident that mortgage rates will continue to fall in the coming months as the pandemic rages. But that sometimes they move up slightly for hopefully short periods of time.
And such a period of higher rates could well occur this week. The US Congress should be obsessed with two challenges right now. To:
Adopt a stimulus package that will put money in their pockets for millions of Americans in trouble
If you think politicians will be able to handle these challenges, expect slightly higher rates for a while. However, the timing is unclear: when the measures might be passed and how long they will affect mortgage rates.
Until there is real hope that action will be taken Mortgage rates could fall further or remain stable.
The general trend in mortgage rates has been falling significantly in recent months. Freddie Mac said a new all-time low was set in each of the weeks ending October 15th and 22nd, November 5th and 19th and December 3rd. In fact, there have been 14 such weekly records so far this year.
Note, however, that Freddie's numbers only relate to buying mortgages and ignore refinancing. And if you averages them both, the rates have been consistently higher than the all-time lows since a record high in early August, even though they're now extraordinarily close. The gap between the two has been widened by a controversial regulatory change.
Mortgage Forecast Experts
Looking ahead, Fannie Mae, Freddie Mac, and the Mortgage Bankers Association (MBA) each have a team of economists devoted to monitoring and forecasting the impact on the economy, housing and mortgage rates.
And here are their current interest rate forecasts for the final quarter of 2020 (Q4 / 20) and the first three of 2021 (Q1 / 21, Q2 / 21 and Q3 / 21).
Note, however, that fannies (published November 17th) and the MBA (also November 17th) are updated monthly. However, Freddies are now released quarterly. And its latest version was released on October 14th and it now looks out of date.
The numbers in the table below are for 30-year fixed rate mortgages:
Q4 / 20
Q1 / 21
Q2 / 21
Q3 / 21
So the predictions vary considerably. You pay your money …
And another prognosis
On December 2nd, the National Association of Realtors threw its hat into the forecast ring. It said:
The forecast assumes that mortgage rates will slowly rise towards the end of the last half of 2021 and reach 3.4% by the end of the year.
Find your lowest price today
Some lenders have been terrified by the pandemic. And they only limit their offerings to the most vanilla-flavored mortgages and refinances.
But others remain brave. And chances are you can still find the withdrawal refinance, investment mortgage, or jumbo loan you want. You just need to shop broader.
But of course, no matter what type of mortgage you want, you should do a lot of shopping in comparison. As a federal regulator, the Consumer Financial Protection Bureau says:
Shopping for your mortgage can result in real savings. It might not sound like much, but if you save even a quarter point on your mortgage, you will save thousands of dollars over the life of your loan.
Check your new plan (December 12, 2020)
Mortgage rate method
The mortgage reports receive interest rates based on selected criteria from multiple credit partners on a daily basis. We find an average rate and an annual interest rate for each type of loan that we want to show on our chart. Since we calculate a series of average prices, this will give you a better idea of what you might find in the market. We also calculate average interest rates for the same types of loans. For example, FHA was fixed with FHA. The end result is a good snapshot of the daily rates and how they change over time.