Today's mortgage and refinancing rates
Average mortgage rates fell again yesterday. And for a worthwhile amount. Every win, no matter how small, is welcome. However, it is too early to hope that this will mark the start of a prolonged period of falls.
In fact, the early market moves unfortunately point to it Mortgage rates are likely to rise today, supported by strong retail sales this morning.
Find and lock a cheap rate (October 15, 2021)
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 and lock a cheap rate (October 15, 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?
Don't assume that the declines over the past few days are the start of a new trend. Of course nothing is impossible. But read on for why I think it's unlikely.
In the meantime, 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
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 note yield increased from 1.54% to 1.57%. (Bad for mortgage rates.) More than any other market, mortgage rates usually follow these particular government bond yields
Important 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 lower
Oil prices elevated to $ 82.34 from $ 80.81 a barrel. (Bad for mortgage rates *.) Energy prices play a huge role in creating inflation and also indicate future economic activity.
Gold prices dropped to $ 1,769 from $ 1,797 an ounce. (Bad 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 – increased from 37 to 48 From 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 caveat, Mortgage rates are likely to rise today. Note, however, that "intraday swings" (when prices change direction during the day) are a common feature these days.
Find and lock a cheap rate (October 15, 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
Stock market indices soared yesterday as a new season began for companies to post their latest quarterly earnings. Sometimes higher indexes translate into higher mortgage rates. But that wasn't the case yesterday. And it may be that investors were on a sugar frenzy.
There are forces trying to pull down mortgage rates. Most notably, supply chain issues are likely to lead to further bottlenecks in some goods. Sales of new cars and trucks are particularly hard hit by the global shortage of computer chips.
There is of course no doubt that this is slowing economic recovery. And mortgage rates tend to be high in good times and low in bad.
However, the forces that are designed to drive mortgage rates up seem stronger to me. First of all, the economy is still booming, even if growth is somewhat slower than economists expected at the beginning of the year. And nationwide infection rates for COVID-19 have been falling for more than a month, releasing a brake on recovery.
Meanwhile, inflation is proving to be much more stubborn than the Federal Reserve and others forecast a few months ago. Well, it's possible that disappointing inflation data released earlier this week contributed to the lower mortgage rates we saw – just as a general driver of pessimism.
But that will probably not last. Because higher inflation almost inevitably leads to higher mortgage rates. Why would investors in fixed income assets (including mortgage-backed securities – a type of bond that largely determines mortgage rates) want to own low-yielding bonds when all of their profits are being consumed by inflation? In order for these investments to remain attractive, yields and mortgage rates must rise.
And on top of that we have "tapering". That is the imminent cessation of mortgage-backed securities purchases by the Fed, which has kept mortgage rates artificially low for 18 months. I covered that in more detail yesterday.
Are you facing higher mortgage rates?
In my view, the forces that will drive mortgage rates up appear much stronger than those that are trying to pull them down. I'm sorry to have to say that. And I long for those heady times in 2020 when I could bring you good news almost every day. But I suspect climbs – punctuated by the occasional falls – will stay here.
Of course, the opposite can be proven to me. It could just take a momentous catastrophe (perhaps a new, much worse variant of COVID-19) to crash the economy and turn mortgage rates in reverse. But let's hope that doesn't happen.
For more details on the Fed's plans and other influences on mortgage rates, see 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. But then the trend was reversed and interest rates rose moderately.
However, as of April, these increases have been largely replaced by decreases, albeit typically small. More recently, we've had a couple of months with these courses barely moving. But unfortunately we have been seeing increases since the beginning of September.
Freddies Oct 14 Report gives this weekly average for 30-year fixed-rate mortgages at 3.05% (with 0.7 fees and points), high from 2.99% the previous week. Freddie chief economist Sam Khater said in a statement that day:
The 30-year fixed-rate mortgage has soared to its highest level since April. With inflationary pressures building due to the ongoing pandemic and tightening of monetary policy (the Fed tightening), we expect rates to continue to rise slightly.
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 September 20th and the MBAs updated on September 22nd. But Freddies were last updated on July 15th as these numbers are now only released quarterly. And his forecast looks seriously stale.
Q3 / 21
Q4 / 21
Q1 / 22
Q2 / 22
However, with so many imponderables, all of the current predictions can be even more speculative than usual.
All of these predictions anticipate higher mortgage rates soon, or pretty 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. Or maybe Fannie thinks the tapering will have little effect.
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 a quarter point on 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.