Today’s mortgage and refinance rates
Average mortgage rates fell for the third consecutive day yesterday. And, together, those have made a worthwhile difference.
However, it’s looking as if mortgage rates today may rise. We can expect volatility, at least until we have a better understanding of the Omicron COVID-19 variant. And that volatility may include rates changing direction during a trading session. So my daily predictions may be less reliable than they normally are.
Current mortgage and refinance rates
|Conventional 30 year fixed||3.292%||3.312%||-0.01%|
|Conventional 15 year fixed||2.712%||2.742%||-0.01%|
|Conventional 20 year fixed||3.136%||3.169%||+0.01%|
|Conventional 10 year fixed||2.682%||2.742%||-0.02%|
|30 year fixed FHA||3.369%||4.135%||-0.05%|
|15 year fixed FHA||2.575%||3.179%||-0.24%|
|5/1 ARM FHA||2.492%||3.179%||-0.05%|
|30 year fixed VA||3.199%||3.393%||-0.03%|
|15 year fixed VA||2.771%||3.113%||+0.01%|
|5/1 ARM VA||2.559%||2.407%||-0.07%|
|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.|
Should you lock a mortgage rate today?
Expect some quite sharp swings in mortgage rates until we know more about the Omicron variant, which this morning had a presence in 23 countries across five continents. So we could be in for a volatile few weeks.
Overall, I’d expect rates to fall over that period. But there are likely to be plenty of days when they rise.
So, for now, my personal rate lock recommendations, which I changed yesterday, are:
- FLOAT if closing in 7 days
- FLOAT if closing in 15 days
- FLOAT if closing in 30 days
- FLOAT if closing in 45 days
- FLOAT if closing in 60 days
>Related: 7 Tips to get the best refinance rate
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 1.48% from 1.43%. (Bad for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields
- Major stock indexes were higher soon 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. But this is an imperfect relationship
- Oil prices climbed to $68.46 from $67.10 a barrel. (Bad for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity
- Gold prices decreased to $1,788 from $1,798 an ounce. (Neutral for mortgage rates*.) In general, it is 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 — dropped to 30 from 34 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, 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.
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. And a recent regulatory change has narrowed a gap that previously existed
So a lot is 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?
As I explained yesterday, the main driver for that day’s falls in mortgage rates was an interview in The Financial Times given by Moderna CEO Stéphane Bancel. He suggested that existing vaccines would probably be less effective in protecting against the new Omicron variant. And he spoke of a “material drop” in that efficacy.
However, markets may be rethinking their reactions to the interview this morning. Mr. Bancel is a billionaire businessperson. And his qualifications for providing medical insights seem limited. As importantly, his company might benefit from his comments.
Meanwhile, markets this morning may be pondering remarks made yesterday by Federal Reserve Chair Jerome Powell. He suggested that the Fed may withdraw its support for artificially low mortgage rates (and low government bond yields) faster than is currently planned.
If they aren’t already, investors may soon be troubled by the imminent hitting of the nation’s debt ceiling. You may remember that Congress recently kicked that particular can down the road.
But it hasn’t gone far. And we can expect volatility in markets as the ceiling gets increasingly close. The US Treasury says the crunch may come as soon as two weeks hence.
If Congress doesn’t raise the ceiling by then, the United States might begin defaulting on its debts. And that’s something that’s never happened before. The implications are exceedingly scary.
Indeed, if politicians play chicken with the deadline, the debt ceiling might become a more powerful force on markets than Omicron. And that could bring higher rather than lower mortgage rates.
For more background, read Saturday’s weekend edition of this daily report.
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.
Since then, the picture has been mixed with extended periods of rises and falls. Unfortunately, since September, the rises have grown more pronounced, though not consistently so.
Freddie’s Nov. 24 report puts that weekly average for 30-year, fixed-rate mortgages at 3.1% (with 0.7 fees and points), unchanged from the previous week.
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, current quarter of 2021 (Q4/21) and the first three quarters of 2022 (Q1/22, Q2/22 and Q3/22).
The numbers in the table below are for 30-year, fixed-rate mortgages. Fannie’s were published on Nov. 18 and the MBA’s on Nov. 22.
Freddie’s were released on Oct. 15. It now updates its forecasts only quarterly. So we may not get another from it until January.
However, given so many unknowables, the whole current crop of forecasts may be even more speculative than usual.
And none of these forecasters had any idea that Omicron might entirely change the models on which they’re based.
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.