Mortgage

Mortgage and refinance charges at present, September 18, and forecast for subsequent week

Today's mortgage and refinancing rates

Average mortgage rates rose noticeably yesterday. That was unexpected. So read on to find out what happened.

Next week brings a potentially decisive event for mortgage rates. But no one can be sure how this will turn out. So I say that Mortgage rates next week are unpredictable. Sorry for the (rare) cop-out. But even educated guesswork is irresponsible under the present circumstances.

Find and lock a cheap rate (September 19, 2021)

Current mortgage and refinancing rates

program
Mortgage rates
Effective interest rate*
Change

Conventional 30 years
3,048%
3,063%
+ 0.04%

Conventionally fixed for 15 years
2.39%
2,415%
+ 0.03%

Conventional 20 years old
2,898%
2,931%
+ 0.06%

Conventionally fixed for 10 years
2,319%
2,376%
+ 0.05%

30 years permanent FHA
2,993%
3.75%
+ 0.01%

Fixed FTA for 15 years
2,439%
3,082%
+ 0.05%

5/1 ARM FHA
2.16%
2,971%
Unchanged

30 years of permanent VA
2,846%
3,036%
+ 0.03%

15 years fixed VA
2,653%
3,002%
+ 0.04%

5/1 ARM-VA
2,421%
2,272%
Unchanged

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 (September 19, 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?

If I were you, I'd fix my mortgage rate. But watch out for temporarily lower prices that may arrive next Monday morning.

The big event next Wednesday (see details below) could go either way. And it is possible for those prices to fall on Wednesday or after. But it is also possible that they will rise significantly.

If I had to bet I'd put a few dollars on her case. But we're talking about your next mortgage rate here. And this stake would be too high for me. Of course, you can be a bolder player than me. And only you can decide which risk level you feel comfortable with.

I am changing my personal recommendations today to reflect next week's risk. But I can change them again on Thursday if the prices are going well:

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

With so much uncertainty right now, however, your instincts could turn out to be as good as mine – or better. So let your gut instinct and your personal risk tolerance guide you.

What is driving current mortgage rates?

According to data from Mortgage News Daily (MND), the average 30-year fixed-rate mortgage rate rose 7 basis points yesterday (one basis point is one hundredth of 1%) and 3 basis points on Thursday. And that caused those rates to rise from 2.93% on Wednesday night to 3.03% last night.

Now, in normal times, 10 basis points over two business days wouldn't be a terrifying increase. But we've got used to dormant mortgage rates over the past few months. And it definitely shocked me. So next we'll discuss what caused it.

Reason for the rise: The big event of the next week

The market commentary I've read suggests that these rises were due to investors positioning themselves ahead of the Federal Reserve's news conference next Wednesday (September 22nd). I've flagged this date as a risk to mortgage rates for several weeks.

Because it is possible that the Fed could announce at its press conference that day that it is slowing down and later stopping ("tapering") some of its easy money guidelines, including artificially keeping mortgage rates low. And the last time it made such an announcement of a similar program in 2013, mortgage rates soared.

Still, I expect the announcement to be closer to November 3 or December 15, the dates of the two remaining Fed press conferences scheduled for this year.

Why? Because despite loud voices within the Fed in favor of an early tapering date, cooler heads have prevailed so far. And I still don't see enough economic evidence of better employment or lower inflation rates for the hotheads to influence the majority.

And yet …

Of course, everyone (including me) assumes that the kind of big investors who can move markets are way smarter than me. And the mortgage rate hikes on Thursday and yesterday suggest that the Fed could act next Wednesday. Maybe they have inside information – or more likely they are hearing rumors.

Either way, today's prices are the current reality. And we will know on Wednesday whether they are eligible or not.

Some good news

There is a glimmer of hope for mortgage rates next Monday. Because these often have shadow returns on 10 year treasury bills.

And those returns were different from mortgage rates yesterday. They rose early in the day, rising from a 1.34% open to 1.39%. But then they fell back and closed at 1.36%. And that's only a moderate increase.

So it is possible that mortgage rates will fall on Monday morning as well, as lenders adjust their rates to reflect the changes later on Friday.

Economic reports next week

Fed statement on Wednesday at 2 p.m. ET and a press conference 30 minutes later are likely to dominate next week. With mortgage rates, everything could change (less likely) or nothing (more likely).

None of the economic reports listed below are likely to cause much movement in the markets unless they include shockingly good or bad data:

Tuesday-August Building Permits and Housing Starts Wednesday-Fed Events Plus Existing Home Sales for August Thursday-August Leading Economic Indicators. Plus weekly new applications for unemployment insurance until Friday, September 18. – New home sales for August

Wednesday is the day to watch.

Find and lock a cheap rate (September 19, 2021)

Mortgage rates forecast for next week

So much depends on the Fed press conference next Wednesday that I cannot make any worthwhile projections for mortgage rates for next week.

Mortgage and refinancing rates usually move in parallel. And a gap that had grown between the two was largely closed with the recent abolition of the disadvantageous market refinancing fee.

And another regulatory change announced this week likely made investment property and vacation home mortgages more accessible and affordable.

This is how your mortgage rate is determined

Mortgage and refinance rates are generally determined by prices on a secondary market (similar to the stock or bond markets) where mortgage-backed securities are traded.

And that depends heavily on the economy. So mortgage rates are typically high when things are going well and low when the economy is in trouble.

Your part

But you play a huge role in determining your own mortgage rate in five ways. And you can significantly affect it by:

Rummage For Your Best Mortgage Rate – They Vary A Lot From Lender To Lender Improve Your Credit Score – Even A Small Boost Can Make A Big Difference To Your Rate And Payments The Biggest Down Payment You Can Save The Biggest Down Payment You Can – Lenders Like You To Get Real Skin In This One Keeping Your Other Borrowings Modest – The lower your other monthly obligations, the higher the mortgage you can afford. Choose Your Mortgage Carefully – Are You Better Off With A Conventional, FHA, VA, USDA, Jumbo, Or Other Loan?

The time you spend getting these ducks in a row can result in you winning lower prizes.

Remember, it's not just a mortgage rate

Remember to count all of the upcoming home ownership costs when figuring out how much a mortgage you can afford. So concentrate on your "PITI". This is yours P.rincipal (pays back the amount borrowed), IInterest (the price of borrowing), (property) TAxles and (homeowners) IInsurance. Our mortgage calculator will help you with this.

Depending on your mortgage type and the amount of your down payment, you may also need to pay for mortgage insurance. And that can easily reach three digits every month.

But there are other potential costs as well. So you have to pay community contributions if you choose to live with an HOA. And wherever you live, you have to expect repair and maintenance costs. There is no landlord to call if something goes wrong!

After all, it's hard to forget about closing costs. You can see this in the specified annual percentage rate (APR). Because this effectively spreads it over the term of your loan and is thus higher than your pure mortgage interest.

But you may be able to get help with these closing costs and your down payment, especially if you are a first-time buyer. Read:

Down payment assistance programs in each state for 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 result is a good snapshot of the daily rates and how they change over time.

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