Mortgages Rates held their ground today and in many cases, carved out small improvements over yesterday's offerings. This keeps us in some of the best territory in recent months in terms of Best-Execution rates. However, there continues to be a greater-than-normal variability between lender offerings. Some lenders are responding to market movements with bigger changes than others, and the outright levels can be quite different from one lender to the next.
Despite that variability, rate sheets between lenders are similar enough to suggest that 4.0% continues to be the most advantageous combination of rate and fees, making it the best all-around candidate for a "Best-Execution rate on a Conventional 30yr Fixed loan. 3.875% is possible for flawless scenarios at the more aggressively priced lenders,
(read more about Best-Execution calculations).
We've been talking a bit about the sort of indecisive attitude that markets seem to have been giving off since interest rates fell last Friday. Yesterday's commentary noted:
markets seem like they'd be willing to go either way into the end of the week--susceptible to unexpected headlines if they're of sufficient importance. By default, things seem to lack firm commitment or "trend."
It was more of the same today. Although bond markets were slightly weaker, they certainly didn't give any signals of a shift in trend, trading fairly flat with respect to the big picture. That sort of broader stability in bond markets is generally a net positive for mortgage rates, even if the underlying market levels are slightly weaker.
But markets can only go sideways for so long, and bond markets have basically been sideways all week. If that doesn't change tomorrow, it would likely change next week. That "change" will be determined, in part, by lines in the sand for underlying markets. We observe that they've recently been sideways due to the fact that neither the happy line or the scary line have been crossed, but be aware that we're right up against the scary line. We'd probably be more comfortable with strategic floating if that were not the case, especially heading into a notoriously volatile day of the week.
Today's BEST-EXECUTION Rates
- 30YR FIXED - 3.875%-4.0%
- FHA/VA -3.75%
- 15 YEAR FIXED - 3.125-3.25%
- 5 YEAR ARMS - 2.625-3.25% depending on the lender
Ongoing Lock/Float Considerations
- Rates and costs continue to operate near all time best levels
- We've recently spent time further away from the very best levels of the past few months having broken away from a long, stable trend.
- That led us to expect greater volatility, and indeed we got it!
- But now that volatility MIGHT be depositing us back at the edge of the old, stable range. Whether it lets us back in or not, is another story.
- Rates could easily move higher or lower, but given the nearness to all time lows, there's generally more risk than reward regarding floating
- (As always, please keep in mind that our talk of Best-Execution always pertains to a completely ideal scenario. There can be all sorts of reasons that your quoted rate would not be the same as our average rates, and in those cases, assuming you're following along on a day to day basis, simply use the Best-Ex levels we quote as a baseline to track potential movement in your quoted rate).