Today’s mortgage and refinance rates
Average mortgage rates rose moderately yesterday following Federal Reserve events we’ve been warning of for some time. Those events made the outlook for these rates more bleak.
Those rates were all over the place yesterday. And they may be again today. But, earlier this morning, markets were signaling that mortgage rates today might fall a little. Just don’t bank on that prediction in such turbulent times.
Current mortgage and refinance rates
|Conventional 30 year fixed||4.559%||4.583%||+0.08%|
|Conventional 15 year fixed||3.768%||3.8%||+0.11%|
|Conventional 20 year fixed||4.527%||4.564%||+0.13%|
|Conventional 10 year fixed||3.794%||3.851%||+0.1%|
|30 year fixed FHA||4.639%||5.436%||+0.06%|
|15 year fixed FHA||4.041%||4.602%||-0.04%|
|30 year fixed VA||4.493%||4.7%||+0.05%|
|15 year fixed VA||4%||4.337%||+1.51%|
|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?
Don’t lock on a day when mortgage rates look set to fall. My recommendations (below) are intended to give longer–term suggestions about the overall direction of those rates. So, they don’t change daily to reflect fleeting sentiments in volatile markets.
Yesterday’s Fed report and news conference made higher mortgage rates more likely in the short and medium term. Of course, there will still be periods when those rates fall, perhaps today. But I expect them to be relatively brief and shallow.
So, my personal rate lock recommendations for the longer term 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
>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 inched up to 2.18% from 2.16%. (Bad for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields
- Major stock indexes were slightly lower soon after opening. (Good 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 $102.06 from $97.88 a barrel. (Bad for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity
- Gold prices increased to $1,943 from $1,916 an ounce. (Good 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 – nudged up to 22 from 20 out of 100. (Bad 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 might move modestly lower. However, 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.
A lot is going on at the moment. And nobody can claim to know with certainty what will happen to mortgage rates in coming hours, days, weeks or months.
Are mortgage and refinance rates rising or falling?
Yesterday, the Federal Reserve announced a 0.25% rise in the federal funds rate, the first such hike since 2018. And that will affect most forms of borrowing. True, such rises do not directly impact mortgage rates. But they do have a knock–on effect.
Much more worrying for those rates were two other revelations emerging yesterday from the Fed’s report and news conference:
- Most top Fed officials now believe there will be six more rate hikes this year – and others in 2023. Some of those could be 0.5% increases
- We should now expect the Fed to unveil its plans to sell its stockpile of bonds immediately after its next meeting, on May 4. Indeed, it might begin those sales from that date
Of course, the rate hikes won’t do mortgage rates any favors. But the sale of bonds could be even more damaging.
To keep the economy afloat during the pandemic, the Fed built up its portfolio of bond assets. And those now include $2.69 trillion of mortgage–backed securities (MBSs).
Yields on those MBSs largely determine mortgage rates. And buying all those bonds artificially pushed those rates down to multiple all–time lows. Guess what happens when the Fed sells them.
It’s easy to overstate all this. The Fed isn’t dumb. So, it won’t dump more MBSs in one go than bond markets can cope with. It will dribble them out.
And the Fed’s been signaling its intentions for months. So markets have been preparing for this scenario. Indeed, we may have already seen much of the pain as investors have priced it in ahead of time.
Still, the Fed was more “hawkish” (keener to come across as tackling inflation aggressively) than we’ve seen in a very long time. And that’s likely to be bad news for mortgage rates for a long time to come.
For more background, read the weekend edition of this daily article, published last Saturday.
Recent trends – 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 that year, according to Freddie Mac.
The most recent weekly record low occurred on Jan. 7, 2021, 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, the rises have grown more pronounced since last September, though not consistently so.
Freddie’s March 17 report puts that weekly average for 30–year, fixed–rate mortgages at 4.16% (with 0.8 fees and points), up from the previous week’s 3.85%.
Note that Freddie expects you to buy discount points (“with 0.8 fees and points”) on closing that earn you a lower rate. If you don’t do that, your rate would be closer to the ones we and others quote.
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 rate forecasts for the four quarters of 2022 (Q1/22, Q2/22, Q3/22, Q4/22).
The numbers in the table below are for 30–year, fixed–rate mortgages. Fannie’s were published on March 17 and the MBA’s on Feb. 25. But Freddie now publishes these forecasts every quarter, most recently on Jan. 21.
Note that the MBA’s figures were issued before Russia invaded Ukraine. Of course, given so many unknowables, the whole current crop of forecasts may be even more speculative than usual.
Find your lowest rate today
You should comparison shop 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.
The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.