Today’s mortgage and refinance rates
Average mortgage rates moved appreciably higher yesterday, as we repeatedly warned was possible. Indeed, over the last three working days, they’ve risen from their lowest level in more than a month to equal their highest over that period, according to Mortgage News Daily’s historical figures.
So far this morning, it’s looking as if mortgage rates today might hold steady or just edge either side of the neutral line. However, some lenders may be yet to fully pass through yesterday’s rises.
Current mortgage and refinance rates
|Conventional 30 year fixed||2.992%||2.992%||+0.08%|
|Conventional 15 year fixed||2.373%||2.373%||+0.13%|
|Conventional 20 year fixed||2.752%||2.752%||Unchanged|
|Conventional 10 year fixed||2.077%||2.119%||+0.13%|
|Conventional 5 year ARM||3.875%||3.312%||+0.15%|
|30 year fixed FHA||2.848%||3.507%||+0.13%|
|15 year fixed FHA||2.664%||3.268%||+0.18%|
|5 year ARM FHA||2.5%||3.213%||+0.02%|
|30 year fixed VA||2.465%||2.639%||+0.09%|
|15 year fixed VA||2.25%||2.571%||Unchanged|
|5 year ARM VA||2.5%||2.392%||+0.02%|
|Rates are provided by our partner network, and may not reflect the market. Your rate might be different. Click here for a personalized rate quote. See our rate assumptions here.|
COVID-19 mortgage updates: Mortgage lenders are changing rates and rules due to COVID-19. To see the latest on how coronavirus could impact your home loan, click here.
Should you lock a mortgage rate today?
This week has shown just how volatile mortgage rates can be, given a hard enough kick. Of course, it’s not impossible that we’ll see falls again, perhaps soon. But, so far, the narrow range within which they’ve been moving within for months has held firm.
And that means the penalties and rewards of continuing to float have been limited. But that can’t last forever. And most experts expect those rates to rise when they break free of that range. So my personal rate lock recommendations must remain:
- LOCK if closing in 7 days
- LOCK if closing in 15 days
- LOCK if closing in 30 days
- LOCK if closing in 45 days
- LOCK if closing in 60 days
However, I don’t claim perfect foresight. And your personal analysis could turn out to be as good as mine — or better. So you might choose to be guided by your instincts and your personal tolerance for risk.
Market data affecting today’s mortgage rates
Here’s a snapshot of the state of play this morning at about 9:50 a.m. (ET). The data, compared with roughly the same time yesterday, were:
- The yield on 10-year Treasurys jumped to 1.56% from 1.49%. (Bad for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields, though less so recently
- Major stock indexes were mixed soon after opening. (Neutral for mortgage rates.) When investors are buying shares they’re often selling bonds, which pushes prices of those down and increases yields and mortgage rates. The opposite may happen when indexes are lower
- Oil prices edged down to $72.23 from $72.28 a barrel. (Neutral for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity.
- Gold prices plunged to $1,789 from $1,859 an ounce. (Bad for mortgage rates*.) In general, it’s better for rates when gold rises, and worse when gold falls. Gold tends to rise when investors worry about the economy. And worried investors tend to push rates lower
- CNN Business Fear & Greed index — inched down to 47 from 48 out of 100. (Good for mortgage rates.) “Greedy” investors push bond prices down (and interest rates up) as they leave the bond market and move into stocks, while “fearful” investors do the opposite. So lower readings are better than higher ones
*A change of less than $20 on gold prices or 40 cents on oil ones is a fraction of 1%. So we only count meaningful differences as good or bad for mortgage rates.
Caveats about markets and rates
Before the pandemic and the Federal Reserve’s interventions in the mortgage market, you could look at the above figures and make a pretty good guess about what would happen to mortgage rates that day. But that’s no longer the case. We still make daily calls. And are usually right. But our record for accuracy won’t achieve its former high levels until things settle down.
So use markets only as a rough guide. Because they have to be exceptionally strong or weak to rely on them. But, with that caveat, so far mortgage rates today look likely to hold steady or just inch either side of the neutral line. But be aware that “intraday swings” (when rates change direction during the day) are a common feature right now.
Important notes on today’s mortgage rates
Here are some things you need to know:
- Typically, mortgage rates go up when the economy’s doing well and down when it’s in trouble. But there are exceptions. Read ‘How mortgage rates are determined and why you should care
- Only “top-tier” borrowers (with stellar credit scores, big down payments and very healthy finances) get the ultralow mortgage rates you’ll see advertised
- Lenders vary. Yours may or may not follow the crowd when it comes to daily rate movements — though they all usually follow the wider trend over time
- When daily rate changes are small, some lenders will adjust closing costs and leave their rate cards the same
- Refinance rates are typically close to those for purchases. But some types of refinances are higher following a regulatory change
So there’s a lot going on here. And nobody can claim to know with certainty what’s going to happen to mortgage rates in coming hours, days, weeks, or months.
Are mortgage and refinance rates rising or falling?
Today and soon
It’s time for a post-mortem on yesterday’s Federal Reserve report and news conference. Those followed the latest meeting of its key policy committee. Yes, the outcome for mortgage rates could have been much worse. But it was still bad.
Overall, the Fed seems to have kept markets reasonably calm, even though it was more candid than some expected. Here are the three main headline points from the news conference:
- An acknowledgment that inflation has been hotter than previously expected. But a suggestion that it will still prove transitory
- A higher likelihood of general interest rate hikes in 2023, earlier than previously thought
- The prospect of further discussions in future meetings about when to begin to gradually reduce (“taper”) asset purchases, including those of mortgage-backed securities (MBSs), the trading of which actually determines mortgage rates
On the last, Fed Chair Jerome Powell remarked, “You can think of this meeting that we had as the ‘talking about talking about’ meeting.”
And it’s that third bullet point that’s important for mortgage rates. Because, when the Fed eventually announces it will taper those MBS purchases, mortgage rates could rise sharply. Most are now expecting that in late summer or the fall, with some anticipating an announcement at the Bretton Woods conference in August.
What this means for mortgage rates
We already know that mortgage rates rose as a result of the Fed meeting. But will they keep going up?
Well, that’s possible. But, for now, any such increases are likely to be gentle rather than sharp. And it’s perhaps more likely that they’ll continue to drift up and down within the current or a slightly higher range.
How come? Well, as CNBC noted overnight, “A patient bond market is the key.” MBSs are a form of bond. And, as long as those who buy and sell those are content to accept the Fed’s reassurances about inflation, volatility might stay away. However, CNBC continues, ” … market historians should also note that the bond market has a history of being slow to react to inflation trends.”
Finally, of course, you can never rule out sustained falls in mortgage rates. True, they seem improbable right now. And it would take some major event to come out of nowhere to make those rates tumble. But that’s not impossible.
For more background, read Saturday’s weekend edition of this column, which has more space for in-depth analysis.
Recently — Updated today
Over much of 2020, the overall trend for mortgage rates was clearly downward. And a new, weekly all-time low was set on 16 occasions last year, according to Freddie Mac.
The most recent weekly record low occurred on Jan. 7, when it stood at 2.65% for 30-year fixed-rate mortgages. But then the trend reversed and rates rose.
However, those rises were mostly replaced by falls in April, though those moderated during the second half of that month. Meanwhile, May saw falls very slightly outweighing rises. Freddie’s June 17 report puts that weekly average at 2.93% (with 07 fees and points), down from the previous week’s 2.96%. But that won’t include some of the sharp rises we’ve seen this week.
Expert mortgage rate forecasts — Updated today
Looking further ahead, Fannie Mae, Freddie Mac and the Mortgage Bankers Association (MBA) each has a team of economists dedicated to monitoring and forecasting what will happen to the economy, the housing sector and mortgage rates.
And here are their current rates forecasts for the remaining quarters of 2021 (Q2/21, Q3/21, Q4/21) and the first quarter of 2022 (Q1/22).
The numbers in the table below are for 30-year, fixed-rate mortgages. Fannie’s were updated on June 16 and the MBA’s on May 21. Freddie’s forecast is dated April 14. But it now updates only quarterly. So its numbers are starting to look stale.
However, given so many unknowables, the current crop of forecasts might be even more speculative than usual.
Find your lowest rate today
Some lenders have been spooked by the pandemic. And they’re restricting their offerings to just the most vanilla-flavored mortgages and refinances.
But others remain brave. And you can still probably find the cash-out refinance, investment mortgage or jumbo loan you want. You just have to shop around more widely.
But, of course, you should be comparison shopping widely, no matter what sort of mortgage you want. As federal regulator the Consumer Financial Protection Bureau says:
Shopping around for your mortgage has the potential to lead to real savings. It may not sound like much, but saving even a quarter of a point in interest on your mortgage saves you thousands of dollars over the life of your loan.
Mortgage rate methodology
The Mortgage Reports receives rates based on selected criteria from multiple lending partners each day. We arrive at an average rate and APR for each loan type to display in our chart. Because we average an array of rates, it gives you a better idea of what you might find in the marketplace. Furthermore, we average rates for the same loan types. For example, FHA fixed with FHA fixed. The end result is a good snapshot of daily rates and how they change over time.