Mortgage And Refinance Rates, March 23

Today’s mortgage and refinance rates

Average mortgage rates rose moderately yesterday. They’ve fallen on just one business day since Mar. 7, and then only modestly. And we thought February was bad!

First thing, markets were signaling that mortgage rates today might fall modestly or moderately. But don’t be surprised if that changes as the hours pass.

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, such as today. 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.

We haven’t seen a sustained and worthwhile period of falling mortgage rates so far in 2022. On Jan. 6, the average rate for a 30–year, fixed–rate mortgage was 3.22%, according to Freddie Mac’s archives. By Mar. 17, it was up to 4.16%. This Thursday’s rates report from Freddie will show it higher yet.

With little prospect of significant falls anytime soon, 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 edged lower to 2.35% from 2.37%. (Good for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields
• Major stock indexes were 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 $114.06 from $111.65 a barrel. (Bad for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity
• Gold prices rose to $1,931 from $1,923 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 – edged up to 44 from 42 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 fall. 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 coming hours, days, weeks or months.

Are mortgage and refinance rates rising or falling?

Yesterday evening, The CNN Business Nightcap e–newsletter summed up the driver behind the last week’s rises in mortgage rates. It suggested

[Federal Reserve Chair Jerome Powell] is sending up flares, beating the drum and doing everything he can to get Wall Street’s attention: Rates are going up, faster and higher than investors expect. The more investors are prepared, the less markets will freak out. In theory, anyway.

In other words, much of the pain homebuyers and refinancers have been experiencing recently is a result of investors anticipating how the Fed’s counter–inflationary measures will affect markets. Those investors are pricing in the coming changes in advance.

That provides some hope that mortgage rate rises might moderate over the summer. Who knows? We might even see a period of falls if the actual pain turns out to be less acute than investors fear. But, at this point, I wouldn’t bank on that.

Fed on the edge

The Fed is currently in a precarious position. If it tamps down inflation too aggressively, it risks creating a recession. Mr. Powell has hinted that might be a price worth paying to return inflation to its annual target rate of 2%.

But, were the central bank to miscalculate and tip the US economy into a severe and lengthy recession or even a depression, all bets would be off. Then the Fed might have to reverse course in ways that could drive mortgage rates lower. But a harmful recession would be a bad way to get cheaper mortgages.

In any event, all that’s months ahead. And, if you’re choosing when to lock your mortgage rate, my advice is very soon indeed.

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, though not consistently so.

Freddie’s Mar. 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 Mar. 17 and the MBA’s on Mar. 22. 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%	4.2%	4.4%	4.5%

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.