Today's mortgage and refinancing rates
Average mortgage rates rose inches yesterday. So the tiny up and down movements continue.
This morning's job report was better than all but the most optimistic predictions. And yet Mortgage rates today can remain stable or barely move as a result. Confused? Read on to explain why markets sometimes view good news as bad news. And how it sometimes takes hours or days to fully process new data.
This daily article will not appear on Monday due to the Independence Day holiday. But our weekend edition comes out tomorrow. And then we'll be back next Tuesday. In the meantime, enjoy your long weekend!
Find and lock a cheap rate (July 2nd, 2021)
Current mortgage and refinancing rates
Effective interest rate*
Conventional 30 year celebration year
Conventionally, 15 years of fixed year
Conventional 20 years old
Conventionally fixed for 10 years
30 years permanent FHA
Fixed FTA for 15 years
5 years ARM FHA
30 years of 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 can be different. Click here for an individual price offer. View our rate assumptions here.
Find and lock a cheap rate (July 2nd, 2021)
COVID-19 Mortgage Updates: Mortgage lenders are changing interest rates and rules due to COVID-19. Click here to learn how the coronavirus could affect your home loan.
Should You Lock A Mortgage Rate Today?
I would probably lock my rate today. Because it is currently likely that mortgage rates will remain stable or just go up or down. So there is little reward for continuing to swim.
Meanwhile, rising mortgage rates seem very likely soon. Unfortunately nobody knows when.
So my personal rate lock recommendations must remain:
LOCK when close in 7th DaysLOCK when close in fifteen DaysLOCK when close in 30th DaysLOCK when close in 45 DaysLOCK when close in 60 Days
However, I am not claiming perfect foresight. And your personal analysis could be as good as mine – or better. So let your instincts and your personal risk tolerance guide you.
Market Data Affecting Mortgage Rates Today
Here's a snapshot of what was now this morning at around 9:50 a.m. ET. The dates, compared to about the same time yesterday, were:
The 10-year Treasury yield Inches lower to 1.45% from 1.46%. (Good for mortgage rates.) More than any other market, mortgage rates usually follow these particular government bond yields, albeit less recentlyImportant stock indices were higher shortly after opening. (Bad for mortgage rates.Often times, when investors buy stocks, they sell bonds, which depresses the prices of those stocks and increases yields and mortgage rates. The opposite can happen when the indices are lowerOil prices fell back on $ 74.87 from $ 76.20 a barrel. (Good for mortgage rates *.) Energy prices play a huge role in creating inflation and also indicate future economic activity. Gold prices increased from $ 1.7 to $ 1,78580 an ounce. (Neutral for mortgage ratesIn general, it is better for interest rates when gold rises and worse when gold falls. Gold tends to rise when investors worry about the economy. And worried investors tend to cut ratesCNN Business Fear and Greed Index – increased from to 46 44 of 100. (Bad for mortgage rates.) “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. So lower values are better than higher ones
* A change of less than $ 20 in gold prices or 40 cents in oil prices is a fraction of 1%. Therefore, when it comes to mortgage rates, we only count meaningful differences as good or bad.
Reservations about markets and prices
Before the pandemic and the Federal Reserve's interventions in the mortgage market, you could look at the numbers above and make a pretty good guess as to what would happen to mortgage rates that day. But that is no longer the case. We still use the phone every day. And they are mostly right. But our records for accuracy will not reach its previous high levels until things settle down.
Use markets as a rough guide only. Because they have to be extraordinarily strong or weak to be able to rely on them. But with this restriction so far Mortgage rates are likely to remain stable today or be a few inches higher. Note, however, that "intraday swings" (when prices change direction during the day) are a common feature these days.
Find and lock a cheap rate (July 2nd, 2021)
Important information about current mortgage rates
Here are some things you need to know:
Usually mortgage rates go up when the economy is doing well and go down when the economy is in trouble. But there are exceptions. Reading & # 39;How Mortgage Rates Are Determined and Why You Should Care About It
Only “top notch” borrowers (with great credit scores, high down payments, and very healthy finances) will get the extremely low mortgage rates you see advertised
Lenders vary. Yours may or may not follow the crowd when it comes to daily price action – though they usually all follow the broader trend over time
When the daily price changes are small, some lenders adjust closing costs and leave their price lists unchanged
The refinancing rates are usually close to those for purchases. However, some types of refinancing are higher after a regulatory change
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?
today and so on
Markets around the world traded overnight in anticipation of the official labor market report this morning. Only a few inflation reports currently compete for its impact on stocks and bonds, including those that determine mortgage rates.
And now we know what it said. But before we get into the details, you need two caveats. First, we have a pretty good idea of how the markets usually react to good news or bad news. But these are not normal times, and they haven't followed the usual playbook for the past few months. Second, it sometimes takes hours or days for them to fully digest information. Sometimes a knee-jerk reaction is followed by a more deliberate one. There is a risk that we are seeing this morning.
So to the headline numbers. The number of people employed outside agriculture rose by 850,000 in June, far higher than analysts expected. Most consensus forecasts were around the 700,000 mark. Surprisingly, the unemployment rate rose to 5.9% compared to an expectation of 5.6%. The result increased by 3.6% compared to the previous year and thus as expected.
When good news is bad news
This is great news. And for a few minutes, the yields on 10-year Treasury bills (which are often overshadowed by mortgage rates) rose. But then they started falling again before climbing inches higher and effectively nowhere fast. Why?
Well, as the Wall Street Journal noted earlier this morning, “… investors are always concerned that good news is too good, causing the Federal Reserve to tighten policies faster.” Markets want the Fed to last this long stay on the stimulus gas as much as possible. And anything that could speed up the day when it wears off is considered negative. So far, the perceived negative and positive aspects of today's report seem more or less balanced.
Meanwhile, the Federal Reserve came under further pressure yesterday from the Institute for Supply Management's producer price index for June. That climbed to its highest level since 1979. The more worrisome the inflation indicators are and the longer they last, the more likely it is that the Fed will back down on its asset-buying program. And it is the purchase of mortgage-backed securities under this program that is currently keeping mortgage rates artificially low.
Mortgage Rates and Inflation: Why Are Rates Rising?
For more background information, see the weekend edition of this Saturday column, which offers more space for in-depth analysis.
The general trend in mortgage rates was clearly declining for much of 2020. And according to Freddie Mac, a new weekly all-time low was hit 16 times in the past year.
The most recent weekly record low was recorded on January 7th when it was 2.65% for 30-year fixed-rate mortgages. But then the trend was reversed and interest rates rose.
However, those increases were largely replaced by declines in April, although these moderated in the second half of this month. Meanwhile, May saw declines that slightly outweighed the increases. Freddie's July 1 report puts that weekly average at 2.98% (with 0.6 fees and points). Low from 3.02% the previous week.
Expert predictions for mortgage rates
Looking ahead, Fannie Mae, Freddie Mac, and the Mortgage Bankers Association (MBA) each have a team of economists devoted to monitoring and forecasting developments in the economy, real estate and mortgage rates.
And here are their current interest rate forecasts for the remaining quarters of 2021 (Q2 / 21, Q3 / 21, Q4 / 21) and the first quarter of 2022 (Q1 / 22).
The numbers in the table below apply to 30-year fixed-rate mortgages. Fannies were updated on June 16th and the MBAs updated on June 18th. Freddie's forecast is dated April 14, but is now only updated quarterly. So the numbers look out of date.
Q2 / 21
Q3 / 21
Q4 / 21
Q1 / 22
However, with so many imponderables, current forecasts could be even more speculative than usual.
Find your lowest rate today
Some lenders have been terrified by the pandemic. And they are limiting their offerings to vanilla-flavored mortgages and refinancing.
But others remain brave. And you can still probably find the refinance, investment mortgage, or jumbo loan you want. All you have to do is look around.
But of course, no matter what type of mortgage you want, you should compare widely. As a federal regulator, the Consumer Financial Protection Bureau says:
Shopping for your mortgage has the potential to result in real savings. It may not sound like much, but if you save a quarter point on interest on your mortgage, you will save thousands of dollars over the life of your loan.
Confirm your new plan (July 2, 2021)
Mortgage rate methodology
The mortgage reports receive daily interest rates based on selected criteria from multiple credit partners. We'll find an average interest rate and an APR for each type of loan shown on our chart. Since we average a range of prices, this will give you a better idea of what you might find in the market. In addition, we determine average interest rates for the same types of credit. Example: FHA fixed with FHA fixed. The end result is a good snapshot of the daily rates and how they change over time.