Today's mortgage and refinancing rates
Average mortgage rates fell moderately yesterday. I predicted they would go higher. And you can find out why I got this wrong by reading on. Of course, these rates will remain relatively high through 2020-21. But they are extraordinarily low from everyone else.
And maybe there is more good news. because Mortgage rates are likely to fall again today. However, the markets are volatile, which can change as the day progresses.
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Current mortgage and refinancing rates
Effective interest rate*
Conventional 30 years
Conventionally fixed for 15 years
Conventional 20 years old
Conventionally fixed for 10 years
30 years permanent FHA
Fixed FTA for 15 years
5/1 ARM FHA
30 years of permanent VA
15 years fixed 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.
Should You Lock A Mortgage Rate Today?
We have seen mortgage rates fall more than rise over the past week. But I doubt they will herald a reversal in the recent uptrend. And I suspect we'll see them as a slip-up rather than something new.
So my personal rate lock recommendations 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
> Related: 7 tips for the best refinancing rate
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 note yield decreased from 1.60% to 1.56%. (Good for mortgage rates.) More than any other market, mortgage rates usually follow these particular government bond yieldsImportant stock indices were mixed shortly after opening. (Neutral 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 lower. But that's an imperfect relationshipOil prices fell to $ 83.39 from $ 84.77 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 $ 1,790 an ounce to $ 1,794. (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 – held constant at 78 out of 100. (Neutral 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 caveat, Mortgage rates could go down today. Note, however, that "intraday swings" (when prices change direction during the day) are a common feature these days.
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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. Read 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) get the extremely low mortgage rates you see advertised lenders vary. Yours may or may not follow the bulk of daily price movements – although they all follow the broader trend over time. When daily price changes are small, some lenders adjust closing costs and leave their price lists the same as for purchases. And a recent regulatory change has closed a pre-existing loophole
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?
Why was my prediction from yesterday wrong? Well, part of that could have been a hangover from last Friday when the day started badly for these prices but improved over the hours. But the improvement came too late for lenders to change their price lists. And the benefits were borne over the weekend. Meanwhile, yesterday also brought lower rates after a bad start.
Unfortunately, these things happen with markets. In fact, they're a feature, not a bug.
And they seem particularly prone to such rashes at the moment. According to the Financial Times earlier this morning, Bank of America suggested that "the gap between stocks and fixed-income (bond) volatility measures is widening the fastest in a decade." And it refers to the "US Bond tumult".
Of course, mortgage interest rates are largely determined by trading in a type of bond: Mortgage Backed Security (MBS). So the message seems to be: "Hold on to your hats!"
Today and soon
Some of that volatility could be due to an announcement that pretty much everyone believes the Federal Reserve will make tomorrow afternoon (ET). It is expected to gradually reduce the amount it currently spends each month buying certain bonds: $ 40 billion on MBS and $ 80 billion on US Treasuries.
Many believe that within a few weeks, the Fed will begin slowing these purchases and “shortening” them (going to zero) by mid-2022. And that will likely keep mortgage rates high. Because those expenses kept them artificially low for the past 19 months.
The recent hikes in these mortgage rates are largely due to investors positioning themselves in anticipation of the Fed's move.
So tomorrow we may not see the sharp climb that I once thought was likely. But it can still be an interesting day for mortgage rates.
Other pressures on mortgage rates
The Fed's announcement isn't the only force pushing these rates higher. Others are:
Inflation – Investors buy fixed income securities when they buy a bond, including an MBS. But inflation is high right now. Indeed, higher than the income a bond will bring in Decreasing COVID-19 Infection Rates – The number of new infections in the US was 74,504 yesterday, according to The New York Times. On September 13th there were 285,058. This withdrawal of the coronavirus bodes well for our economy.
Both (and the Fed) are trying to drive up mortgage rates. But there are some who try to pull them down:
Global and domestic supply chain issues holding back both productivity and consumer spending COVID-19 – The decline in new infections is starting to stabilize. And some virus experts fear a new winter wave that could further slow down or even undermine the economic recovery.
Right now, the forces that are driving rates up seem much stronger to me than those that are pulling them down. So I still expect mortgage rates to continue to rise, even though the trend is inevitably interrupted by falling periods.
But, as always, that prediction could change if circumstances do.
Further background information can be found in the weekend edition of these daily reports from last Saturday.
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.
Since then, the picture has been mixed with longer phases of ascent and descent. Unfortunately, the increases have become clearer since September.
Freddies Oct 28 Report gives this weekly average for 30-year fixed-rate mortgages at 3.14% (with 0.7 fees and points), high compared to 3.09% the previous week.
Expert predictions for mortgage rates
Looking to the future, 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 current quarter of 2021 (Q4 / 21) and the first three quarters of 2022 (Q1 / 22, Q2 / 22 and Q3 / 22).
The numbers in the table below apply to 30-year fixed-rate mortgages. Fannies and Freddies were published on October 15th and the MBAs on October 18th.
ForecastersQ4 / 21Q1 / 22Q2 / 22Q3 / 22Fannie Mae 3.1% 3.2% 3.2% 3.3% Freddie Mac 3.2% 3.4% 3.5% 3.6% MBA 3.1% 3.3% 3.5% 3.7%
However, with so many imponderables, all of the current predictions can be even more speculative than usual.
All of these forecasts expect at least slightly higher mortgage rates in the near future.
Find your lowest price 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 a lot, but it does If you save even a quarter interest on your mortgage, you will save thousands of dollars over the life of your loan.
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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.