January 22, 2022

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Mortgage and refinance rates today, July 28, 2021

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Today’s mortgage and refinance rates 

Yet again, average mortgage rates inched lower yesterday. And the cumulative effect of all the falls since the middle of the month has been more than worthwhile.

First thing, market movements suggested mortgage rates may rise today, unfortunately. But investors are waiting with bated breath for an announcement from the Federal Reserve this afternoon. And that could change everything. Read on for more details.

Find and lock a low rate (Jul 28th, 2021)

Current mortgage and refinance rates 

Program Mortgage Rate APR* Change
Conventional 30 year fixed 2.71% 2.71% -0.07%
Conventional 15 year fixed 1.99% 1.99% Unchanged
Conventional 20 year fixed 2.382% 2.382% +0.01%
Conventional 10 year fixed 1.839% 1.862% Unchanged
30 year fixed FHA 2.625% 3.277% Unchanged
15 year fixed FHA 2.341% 2.94% -0.03%
5/1 ARM FHA 2.5% 3.207% Unchanged
30 year fixed VA 2.25% 2.421% Unchanged
15 year fixed VA 2.125% 2.445% Unchanged
5/1 ARM VA 2.5% 2.386% Unchanged
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.

Find and lock a low rate (Jul 28th, 2021)

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?

Falls in recent days have likely been a result of markets focusing on a Federal Reserve meeting that began yesterday and ends at lunchtime today. Chances are, nothing that significantly changes things for mortgage rates will arise out of the Fed’s post-meeting statement at 2 p.m. (ET) this afternoon and news conference 30 minutes later.

But it really is possible that something will. Given that small risk and the fact that experts are close to unanimity in predicting higher mortgage rates soon, my personal rate lock recommendations 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 Treasury notes rose to 1.26% from 1.24%. (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 mostly higher shortly after opening. (Bad 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 up to $72.02 from $71.83 a barrel. (Neutral for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity. 
  • Gold prices fell to $1,795 from $1,803 an ounce. (Neutral 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 indexinched down to 27 from 28 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 rise. But be aware that “intraday swings” (when rates change direction during the day) are a common feature right now.

Find and lock a low rate (Jul 28th, 2021)

Important notes on today’s mortgage rates

Here are some things you need to know:

  1. 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
  2. Only “top-tier” borrowers (with stellar credit scores, big down payments and very healthy finances) get the ultralow mortgage rates you’ll see advertised
  3. 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
  4. When daily rate changes are small, some lenders will adjust closing costs and leave their rate cards the same
  5. Refinance rates are typically close to those for purchases. And a recent regulatory change has narrowed a gap that previously existed

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

For a fairly full analysis of what the Fed might do this afternoon and how it might affect mortgage rates, read yesterday’s edition of this daily article. To sum that up, it’s probable that nothing will change. But it’s possible that a lot will, including appreciably higher mortgage rates. So stand by.

Is the economic recovery stalling?

It will be bad news for everyone — except those who want even lower mortgage rates — if the current recovery stalls. Luckily, most economic data remain positive and suggest 2021 will be a boom year.

But many economists are growing increasingly worried about the possible effects of the Delta variant (and any subsequent variants that might emerge) on economies globally.

Yesterday, the International Monetary Fund (IMF) published the latest edition of its quarterly World Economic Outlook (WEO). It said:

The global economy is projected to grow 6.0 percent in 2021 and 4.9 percent in 2022. The 2021 global forecast is unchanged from the April 2021 WEO, but with offsetting revisions.

— IMF, World Economic Outlook, July 27, 2021

The IMF expected the US economy to grow by 7.0% in 2021, which is a truly exceptional figure: the best for decades.

Delta variant risk

But what about those “offsetting revisions? Guardian Economics Editor Larry Elliott explained those yesterday:

So what could go wrong? The IMF has come up with two downside scenarios: one in which emerging countries are hit by a new wave of the virus this year and advanced countries rapidly reverse stimulus policies in the face of rising inflation; and a second in which rising infections affect rich countries as well as poor. In the first scenario, global growth would be 0.75% lower this year and 1.5% lower next than the IMF is currently forecasting. In the second, 0.8 percentage points are shaved off growth in both years. In both cases, the global economy ends up $4.5tn … smaller than expected by 2025.

— The Guardian, “The IMF is right: global economic recovery from Covid could go wrong,” July 27, 2021

Weird bond markets

What’s strange is that bond markets are acting, not only as if these bad scenarios have already come to pass, but as if much worse has happened. If you look at yields on 10-year Treasury notes since 1980 (see CNBC’s chart), they’re currently at their lowest point in that whole time — with the exception of the 11 months from March last year until Feb. this. And that was when the pandemic was at its scariest and most damaging.

Yet nobody has a clear idea of why this is happening. True, the Fed is buying assets (mostly bonds) at a rate of $120 billion a month. But few think that’s enough to explain why bond markets are behaving so strangely. Indeed, I recently quoted CNBC calling the phenomenon “mystifying.”

So what has all this to do with mortgage rates? Well, a lot. Because those rates are determined by the prices (and therefore yields) of mortgage-backed securities. And those are a type of bond, traded in a specialist bond market. Yes, their behavior is as “mystifying” as that of any other.

My rate lock recommendations

All this explains why my rate lock recommendations (above) haven’t changed for a long time. It’s not just that I’m stubborn or pigheaded (though many would say I’m both). No, it’s because I have to believe that bond markets will soon return to their conventional playbook and start acting as if we’re in the midst of an economic boom rather than a recession.

And, when they do, mortgage rates should rise. Luckily, I’m not the only one to believe this. If you look at the “expert mortgage rate forecasts,” below, you’ll see every forecaster listed expects those rates to move higher in the current quarter.

For more background, read Saturday’s weekend edition of this column.

Mortgage rates and inflation: Why are rates going up?


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 and since, though typically small ones. Freddie’s July 22 report puts that weekly average at 2.78% (with 0.7 fees and points), down from the previous week’s 2.88%.

Expert mortgage rate forecasts

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 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 are for 30-year, fixed-rate mortgages. Fannie’s were updated on July 19, Freddie’s on July 15 and the MBA’s on July 21.

Forecaster Q3/21 Q4/21 Q1/22 Q2/22
Fannie Mae 3.0% 3.1%  3.2% 3.2%
Freddie Mac 3.3% 3.4%  3.5% 3.6%
MBA 3.2% 3.4%  3.8% 4.0%

However, given so many unknowables, the current crop of forecasts might be even more speculative than usual.

All these forecasts expect higher mortgage rates soon. But the differences between the forecasters are stark. And it may be that Fannie isn’t building in the Federal Reserve’s tapering of its support for mortgage rates while Freddie and the MBA are.

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.

Verify your new rate (Jul 28th, 2021)

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.

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