Mortgage And Refinance Rates, April 14

Today’s mortgage and refinance rates

Average mortgage rates fell again yesterday. That made two consecutive days of appreciable falls. And those made a worthwhile difference to those rates.

So far this morning, key markets are hardly moving. And mortgage rates today might just edge higher. But that could change as this short session continues.

Markets close early today for the Easter weekend. And they’ll be closed all day tomorrow, which is Good Friday. We’ll be back with the weekend edition on Saturday and the daily one next Monday.

Current mortgage and refinance rates

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.

Mortgage rates fell yesterday by a worthwhile amount for a second consecutive day. And the same driver seems to have been behind both falls. Namely, the hope that inflation may have peaked last month.

There’s some evidence to support that analysis. But it’s far from conclusive. And, as I wrote yesterday: “Of course, nobody can predict the life expectancy of such optimism, which is based on factual but limited evidence.”

So we just might be seeing the start of a new direction for mortgage rates. But I’m far from convinced that’s the case. At least, not yet. Not that it matters what I think. Markets will decide.

Still, 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 rose to 2.76% from 2.68%. (Bad for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields
• Major stock indexes were mostly 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 nudged up to $103.16 from $102.24 a barrel. (Bad for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity
• Gold prices edged down to $1,976 from $1,979 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 — were unchanged at 44 out of 100. (Neutral 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 movement of less than $20 on gold prices or 40 cents on oil ones is a change of 1% or less. 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 increase modestly. 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:

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.

A lot is going on at the moment. And nobody can claim to know with certainty what will happen to mortgage rates in the coming hours, days, weeks or months.

Are mortgage and refinance rates rising or falling?

You can catch up here if you missed yesterday’s analysis of what’s so suddenly changed in markets. But, briefly, investors now seem to think that inflation may have started to tail off.

The evidence for that is pretty flimsy. But the narrative seems to have taken hold. And we’ll have to wait to see how long it lasts.

It just might prove permanent. Mortgage rates have been soaring this year because the Federal Reserve is spooked by high inflation and has developed aggressive plans to cool it down. Those plans include elements that are almost bound to push those and other rates higher.

If inflation is beginning to wane, the Fed can back off. And it’s quite possible that prices will cool, to some extent, all on their own.

Back in the 1970s and early ‘80s, most inflation occurred because everyone expected it. Companies built in regular price rises within their annual plans and employees received hefty salary increases to help them keep up. It was a vicious circle.

But the current bout of inflation has quite different causes, mostly related to COVID-19 and, more recently, to Russia’s war in Ukraine (along with the West’s sanctions on Moscow). Prices have been rising because of shortages due to supply-chain disruptions and underproduction, first due to lockdowns and now to that war.

Waning inflation?

Some think that, absent the war, prices might have begun to normalize in February. And the war isn’t as disruptive as global COVID was except for certain commodities: oil, wheat and so on.

That “Just hang on, and prices will normalize on their own” narrative was Fed policy for most of last year. But every month that normalization failed to appear piled pressure on it to take decisive action to rein in prices. And, eventually, it caved.

But maybe it was right all along. Maybe prices are beginning to moderate without the Fed lifting more than a finger. If so, that would be great for the economy.

Good news for mortgage rates?

The Fed hopes to create a “soft landing,” meaning it can tame inflation without causing a recession — or even the dreaded “stagflation,” which is stagnant growth with rising inflation. But many economists doubt it can achieve that.

And expectations of a recession are growing. When The Wall Street Journal (paywall) polled economists earlier this month, it found “the probability of the economy being in recession sometime in the next 12 months at 28%, up from 18% in January and just 13% a year ago.”

Oh, and the Fed’s backing off from its counter-inflationary measures would also be great news for mortgage rates. But will it?

Read the weekend edition of this daily article for more background.

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.

Freddie’s Apr. 14 report puts that same weekly average for 30-year, fixed-rate mortgages at 5% (with 0.8 fees and points), up from the previous week’s 4.72%. But that Apr. 14 figure won’t include most of that week’s sharp falls.

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 Mar. 17 and the MBA’s on Apr. 13. But Freddie now publishes these forecasts every quarter, most recently on Jan. 21. So its figures are already looking very stale.

Forecaster	Q1/22	Q2/22	Q3/22	Q4/22
Fannie Mae	3.7%	3.8%	3.8%	3.9%
Freddie Mac	3.5%	3.6%	3.7%	3.7%
MBA	3.8%	4.7%	4.8%	4.8%

Of course, given so many unknowables, the whole current crop of forecasts might be even more speculative than usual. I’m afraid I’m less optimistic than any of them.

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.