Mortgage And Refinance Rates, April 19

Today’s mortgage and refinance rates

Average mortgage rates rose again yesterday. According to Mortgage News Daily’s reckoning, that took them back to last Monday’s level, which was the highest in over 10 years.

Mortgage rates today might rise. However, over the last few working days, we’ve seen markets start off one way and end up somewhere entirely different. That’s not unusual at any time. But it’s been especially common and extreme recently. So take these daily predictions with a pinch of salt.

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.

There’s still a ton of volatility in markets. And it’s mostly down to fear of the Federal Reserve’s plans to fight inflation. We’ll know much more about those on May 4. And things may settle down a bit then.

Unfortunately, in the meantime, the sharp upward trend in mortgage rates continues, though it’s been punctuated by some worthwhile falls. Sadly, those falls are easily outweighed by rises.

And 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 2.91% from 2.82%. (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 tumbled up to $104.42 from $108.40 a barrel. (Good for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity
• Gold prices fell to $1,967 from $1,997 an ounce. (Bad 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 — held steady at 40 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 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. 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?

Little has changed recently. And we might continue to see volatile mortgage rates until May 4. That’s the day the Federal Reserve is scheduled to unveil more of its plans to fight inflation.

Unfortunately, the two main weapons it can deploy in that fight both put upward pressure on mortgage rates:

1. Hiking its own rates, which should have a knock-on effect on mortgage rates
2. Running down its $2.7-trillion holdings of mortgage bonds

Mortgage rates have been rising recently as markets have moved to anticipate what the Fed will say on May 4. But, as nobody knows what that will be, those markets have been mainly reacting to fear and uncertainty.

Hence the sharp up and down movements as sentiment changes. Unfortunately, the upward movements have been heavily outweighing the downward ones.

Will the Fed cause a recession?

Some are concerned that the Fed will be unable to tackle inflation without triggering a recession. And history isn’t on its side. Yesterday, The Wall Street Journal (paywall) ran an article that said:

During the past 80 years, the Fed has never lowered inflation as much as it is setting out to do now — by 4 percentage points — without causing recession. In this case, the central bank will need a number of factors out of its control to break its way.

And the article quoted Treasury Secretary Janet Yellen, who used to be a Fed chair. “It will require skill and also good luck,” she said last week.

This morning, the International Monetary Fund (IMF) publishes an updated version of its world economic outlook. And, in a preview last week, IMF managing director Kristalina Georgieva said her organization had downgraded growth forecasts for 143 countries around the world, according to The Guardian. It’s easy for such global slowdowns to slide into recessions.

Of course, a recession would be bad news for most Americans. But it might be good for mortgage rates. Rising unemployment could force the Fed to ease off its anti-inflation drive. And, if things got bad enough, it might even make the central bank restimulate the economy, including by pushing mortgage rates lower again.

What this means for borrowers

But that could be many months away — if it happens at all. And that will be too late for most readers, who will have locked their rates and closed well before then.

If you’re one of those — and you have enough time — you could wait for May 4 to see if the Fed’s plans are less aggressive than markets fear. That could see mortgage rates fall. But that looks to me to be a huge gamble.

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

Recent trends

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, Freddie’s on Apr. 18, and the MBA’s on Apr. 13.

Forecaster	Q1/22	Q2/22	Q3/22	Q4/22
Fannie Mae	3.7%	3.8%	3.8%	3.9%
Freddie Mac	3.8%	4.8%	4.8%	5.0%
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.