Today's mortgage and refinancing rates
Average mortgage rates fell again yesterday. So you are going the right way. However, the recent declines have been smaller than the recent increases. So there is a way to get to the all-time low. Yet these rates remain exceptionally low by all standards.
Markets were flat after disappointing retail sales this morning. and Mortgage rates are likely to remain unchanged or barely changed today.
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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.
Find a cheap rate and block it (August 18, 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?
Nobody expects you to lock while mortgage rates are actually going down. But if you keep releasing your interest rate, you need to stay vigilant. Because most experts – if not all, as we discuss below – expect rate hikes pretty soon.
My personal rate lock recommendations remain for the time being:
LOCK when close in 7th DaysLOCK when close in fifteen DaysLOCK when close in 30th DaysHOVER when close in 45 DaysHOVER 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:
That 10 year Treasury note yield edged from 1.23% to 1.25%. (Bad for mortgage rates.) More than any other market, mortgage rates usually follow these particular government bond yields
Important stock indices were lower shortly after opening. (Good 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
Oil prices rose to $ 67.51 from $ 66.21 a barrel. (Bad for mortgage rates *.) Energy prices play a huge role in creating inflation and also indicate future economic activity.
Gold prices upgraded to $ 1,793 out of $ 1,787 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 rates
CNN Business Fear and Greed Index – dropped from 46 to 37 From 100. (Good 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 just a few inches on either side of the neutral line. Note, however, that "intraday swings" (when prices change direction during the day) are a common feature these days.
Find a cheap rate and block it (August 18, 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. 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?
today and so forth
If there is ever a consensus among financial journalists, the most recent one is that this week's drop in mortgage rates is due to anticipation of the release of documents from the Federal Reserve tomorrow. (Well, that and a slowdown in growth in China.) At 2 p.m., to be precise. (ET) on Wednesday the Fed released the minutes of the last meeting of its monetary policy body, the Federal Reserve Open Market Committee (FOMC).
Why this anticipation? Well, that's because these minutes may reveal more about the Fed's current thinking about tapering. Regular readers know all about it. In a nutshell, however, the Fed is currently buying huge amounts of a type of bond called Mortgage Backed Security (MBS) as part of its stimulus strategy. It also buys government bonds. But it's the MBSs that are currently keeping mortgage rates artificially low.
And the Fed is signaling that it plans to gradually reduce (“shorten”) these purchases, which would normally potentially drive mortgage rates high. However, no one knows exactly when it will herald the time of this movement or when the rejuvenation itself will begin. Perhaps these FOMC logs provide further guidance.
Could Mortgage Rates Stay Low?
Some believe that tapering will have little impact on bond prices and yields. And yesterday, HSBC's Steven Major told CNBC's Squawk Box Show that his bank had forecast that US Treasury bond yields (something that tends to overshadow mortgage rates) would end at 1% this year and next. You can watch the clip on the CNBC website.
If Mr Major is right, these returns would drop significantly further from their current levels (they closed at 1.24% last night). And that could push mortgage rates to new all-time lows and a prolonged period of hyper-affordability.
Almost as surprisingly, Mr. Major dismissed concerns that tapering could have a major impact, at least on US Treasury bond yields. He believes circumstances are very different now than they were in 2013, when a similar announcement sparked a sharp spike in both those yields and mortgage rates.
How Likely are Lower Mortgage Rates?
Today, Mr. Major is Global Head of Fixed Income Research for one of the largest banks in the world. And I am not.
So if CNBC had given him time to give the reasons for his analysis, I might have accepted his arguments. But it did not work.
And most of the other experts currently do not share his forecast. In fact, I quoted another guest on a CNBC show the other day who expected 10-year government bond yields to rise to 1.75% or higher before the end of this year. And that would probably mean 30-year fixed mortgage rates around 4.5%.
So I didn't mean to encourage you to tell you about Mr. Major's predictions, even if they might turn out to be true. And certainly not so that you can rely on them. It should show the range of opinions and possible future scenarios that the current uncertainty has brought with it.
And the message you can take with you today is that nobody knows much.
For more background information, see Saturday's weekend edition of this column.
Mortgage Rates and Inflation: Why Are Rates Rising?
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, these increases have been largely replaced by decreases since April, albeit typically small. Freddie's August 12 report builds on this weekly average 2.87% (with 0.7 Fees and points), high from 2.77% 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 (Q3 / 21 and Q4 / 21) and the first two quarters of 2022 (Q1 / 22 and Q2 / 22).
The numbers in the table below apply to 30-year fixed-rate mortgages. Fannies were updated on July 19, Freddies on July 15, and the MBAs on July 21.
Q3 / 21
Q4 / 21
Q1 / 22
Q2 / 22
However, with so many imponderables, current forecasts could be even more speculative than usual.
All of these predictions anticipate higher mortgage rates soon. But the differences between the forecasters are stark. And Fannie may not be involved in curbing Federal Reserve mortgage support while Freddie and the MBA do.
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 much, but if you save only a quarter point in 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.