Today's mortgage and refinance rates
Average mortgage interest rates were practically unchanged yesterday: only decreased by the smallest measurable amount. Also yesterday, Freddie Mac said his weekly average had hit a new all-time low. And that is in line with our assessment of the situation.
Expected Mortgage rates should remain unchanged or hardly change today – and probably on vacation. They could get worse when Congress finally passes its long-awaited pandemic relief measures. However, the current deal looks too small to provide any significant boost.
Find and block a low rate (December 19, 2020)
Current mortgage and refinancing rates
Conventional 30 years fixed
Conventional 15 years fixed
Conventional 5-year ARM
Fixed FTA for 30 years
Fixed FTA for 15 years
5 years ARM FHA
30 years 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 could be different. Click here for a personalized price offer. See our tariff assumptions here.
Find and block a low rate (December 19, 2020)
COVID-19 Mortgage Updates: Mortgage lenders are changing interest rates and rules due to COVID-19. For the latest information on the impact of Coronavirus on your home loan, click here.
Should You Lock A Mortgage Rate Today?
With a bit of luck we will have a series of Groundhog Days up until January 2, 2021. Given that mortgage rates are currently practically at their all-time lows, this would be a win.
Of course, you can never be sure that something big won't come up, pushing you higher or lower. But it's hard to imagine what. Just realize that there are no guarantees.
If this prediction is correct, it doesn't really matter if you lock up or float for the next several weeks. Personally, I would probably lock – just to relieve the stress – unless I closed in February or later.
Given this (admittedly speculative) scenario, yesterday I updated my personal tariff blocking recommendations:
LOCK when you approach 7th DaysLOCK when you approach 15th DaysLOCK when you approach 30th DaysHOVER when you approach 45 DaysHOVER when you approach 60 Days
But with so much uncertainty right now, your instincts could easily turn out to be as good as mine – or better. So let your gut and your personal risk tolerance guide you.
Market Data Affecting Mortgage Rates Today
Here is the current status at 9:50 a.m. (ET) this morning. The dates, compared to roughly the same time yesterday morning, were:
The 10-year Treasury yield rose from 0.92% 0.90%. (Bad for mortgage ratesMore than any other market, mortgage rates usually tend to follow these particular government bond yields, albeit more recentlyImportant stock indices were mixed and barely moved when opened. (Neutral for mortgage rates.Often times, when investors buy stocks, they sell bonds, which lowers the prices of those bonds and increases yields and mortgage rates. The opposite happens when the indices are lower. Oil prices were starting higher at 48.82 USD $ 48.33 per barrel. (Bad for mortgage rates * because energy prices play a major role in causing inflation and also indicate future economic activity.) Gold prices dropped from $ 1,898 per ounce to $ 1,888. (Neutral for mortgage rates*.) In general, it is better for interest rates when gold rises and worse for interest rates when gold falls. Gold tends to rise when investors worry about the economy. And worried investors tend to cut rates
* A change of less than $ 20 in gold prices or 40 cents in oil prices is a fraction of 1%. Hence, we count significant differences in mortgage rates only as good or bad.
Reservations about markets and prices
Before the pandemic and the Federal Reserve's intervention in the mortgage market, you could look at the numbers above and get a pretty good idea of what would happen to mortgage rates that day. However, this is no longer the case. The Fed is a big player now and a few days can overwhelm investor sentiment.
Use markets only as a rough guide. They have to be exceptionally strong (rates are likely to rise) or weak (they could fall) to be relied on. But so far they have been searching with this restriction quietly for mortgage rates today.
Find and block a low rate (December 19, 2020)
Important Notes About Today's Mortgage Rates
Here are some things you need to know:
The continued intervention of the Fed in the mortgage market (well over $ 1 trillion) should continue to put pressure on these rates. But it can't always work miracles. So expect both short-term increases and decreases. And read: “For once, the Fed affects mortgage rates. Here's why: "If you want to understand this aspect of what is happening, mortgage rates usually go up when the economy is doing well and go down when they're in trouble." There are exceptions, however. Read about 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) will get the ultra-low mortgage rates for which the listed lenders vary. Yours may or may not follow the crowd when it comes to daily interest rate movements – though they usually all follow the broader trend over time. When interest rate changes are small, some lenders adjust closing costs and leave their interest rate cards the same. Refinancing rates are usually close to these for purchases. However, some types of Fannie Mae and Freddie Mac refinancing are currently significantly higher after a change in regulations
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?
I expect mortgage rates again unchanged today or hardly changed.
It is now likely that Congress will come up with a pandemic relief package (and a stopgap to prevent the government from closing), perhaps over the weekend.
But this package may be too small and too widespread to make big waves in the markets. Most investors will have bought or sold ahead of time, assuming it comes.
Brexit (the UK's exit from the European Union) could disrupt US markets. A no-deal Brexit (one without a replacement trade agreement) would be most damaging to the global economy. And if one of these shows up, mortgage rates could drop a little. The two sides have until December 31st to reach an agreement.
Otherwise, everything revolves around the pandemic. Or rather, its impact on the economy. Current data shows that this latest wave is already hitting employment and retail.
And there is a real possibility of zero or negative growth in the first quarter of 2021. That’s terrible for everyone – except those who want even lower mortgage rates.
The general trend in mortgage rates has been falling significantly in recent months. According to Freddie Mac, a new weekly all-time low has already been reached 15 times this year. The last recording of this kind was made yesterday – December 17th.
Mortgage Forecast Experts
Looking ahead, Fannie Mae, Freddie Mac, and the Mortgage Bankers Association (MBA) each have a team of economists devoted to monitoring and forecasting the impact on the economy, housing and mortgage rates.
And here are their current interest rate forecasts for the final quarter of 2020 (Q4 / 20) and the first three of 2021 (Q1 / 21, Q2 / 21 and Q3 / 21).
Note, however, that fannies (published December 15th) and the MBA (November 17th) are updated monthly. But Freddies are now released quarterly. The latest version was released on October 14th. So this is starting to look stale.
The numbers in the table below are for 30-year fixed rate mortgages:
Q4 / 20
Q1 / 21
Q2 / 21
Q3 / 21
So the predictions vary considerably. You pay your money …
And another prognosis
On December 2nd, the National Association of Realtors threw its hat into the forecast ring. It said:
The forecast assumes that mortgage rates will slowly rise towards the end of the last half of 2021 and reach 3.4% by the end of the year.
Find your lowest price today
Some lenders have been terrified by the pandemic. And they only limit their offerings to the most vanilla-flavored mortgages and refinances.
But others remain brave. And chances are you can still find the withdrawal refinance, investment mortgage, or jumbo loan you want. You just need to shop broader.
But of course, no matter what type of mortgage you want, you should shop a lot in comparison. As a federal regulator, the Consumer Financial Protection Bureau says:
Shopping for your mortgage can result in real savings. It might not sound like much, but if you save even a quarter point on your mortgage, you will save thousands of dollars over the life of your loan.
Check your new plan (December 19, 2020)
Mortgage rate method
The mortgage reports receive interest rates based on selected criteria from multiple credit partners on a daily basis. We find an average rate and an annual interest rate for each type of loan that we want to show on our chart. Since we calculate a series of average prices, this will give you a better idea of what you might find in the market. We also calculate average interest rates for the same types of loans. For example, FHA was fixed with FHA. The end result is a good snapshot of the daily rates and how they change over time.