Mortgages Rates are unchanged from yesterday, capping an extremely flat and historically low week.  The FOMC events on Wednesday gave lenders some pause as they were generally more conservative with pricing.  Even so, the variations left the entire week's range about as narrow as they come, a feat that's even more striking considering nearness to all time lows.

The Conventional 30yr Fixed Best-Execution Rate remains at 3.875% after recently being stuck between there and 4.0%. Keep in mind that "best-execution" as we calculate it, connotes the no-closing-cost rate for the best-qualified borrowers in the most ideal scenario.  (read more about Best-Execution calculations)

Low, stable rates are a great thing for the mortgage market, but the longer this narrow, sideways range persists, the greater the risk of bigger movements when the range finally breaks.  Although "greater risks" can refer to both negative AND positive outcomes, we'd continue to note that rates in general have had a hard time going much lower than current levels.  

In other words, historically, there have been diminishing returns for floating vs locking when rates are this low.  That's not to say that this scenario couldn't change in the future, merely that it hasn't so far.  One of the phrases we've used with some frequency with our MBS crowd is "play the range until the range plays you."  In other words, when the market has shown a predisposition to bounce back and forth within the range, take actions based on the expectation that it will continue but be prepared to change your strategy when the range is broken.  

It's sort of a "don't sweat the small stuff" mentality, and admittedly, it has only limited implications on isolated decisions, such as the decision to lock one's own personal loan.  To that end, we can't offer much more advice beyond the usual "tough time going much lower than this historically."  As far as keeping an eye on threats to "the range," we've had our eye on next week's Employment Situation Report for quite some time.  Things could begin changing even in the first four days of the week, but Friday is the biggest potential market mover in the week ahead.


  • 30YR FIXED -  3.875%
  • 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
  • Current levels have experienced increasing resistance in improving much from here
  • Rates could easily move higher or lower, but given the nearness to all time lows, there's generally more risk than reward regarding floating
  • But that will always be the case when rates operate near all-time levels, and as 2011 showed us, it doesn't always mean they're done improving.
  • (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).