Mortgage rates moved higher today, bringing them back in line with the highest levels in nearly a month.  That sounds a bit worse than it actually is, due to the narrow range of rates over that time.  In fact, most prospective borrowers would be quoted the same rate as yesterday, with the only difference being slightly higher upfront costs.

With extended periods of narrow ranges comes increased odds for a bigger move.  There's never any way to tell if such a move will be higher or lower--only that it's more likely.  This is especially true as we head into big-ticket events like tomorrow's jobs report.  Traders are also tuned in to the weekend's French election results and the various political headlines coming out of Washington.  

In general, rates had been trending lower through mid-April, and they've since been in a general uptrend.  Until we can rule out the risk of that uptrend continuing, the lock/float environment continues to favor safety vs risk-taking.  That said, more risk-tolerant borrowers can still use the higher rates from last March as a "lock trigger."  In other words, if rates move back to those levels, that's a sign to lock and avoid further losses.

Loan Originator Perspective

We have 2 more potentially high impacting events coming.  Tomorrow, we get  the Employment Situation Report.  Probably the most important data print we receive on a monthly basis.  It definitely has the ability to move the needle.  This weekend, we have the French elections.  I think a Macron victory is pretty well priced in at this point, but a La Pen victory could spark a very nice bond rally, but the polls are showing a pretty sizable lead for Macron.  It is always risky to float through the jobs reports, so my clients are definitely leaning toward locking today.  As of about 1pm, bonds are off their lows of the day, so I would recommend holding off and look to lock as late as possible.  We may get some price improvements but I wouldn’t hold your breath.  -Victor Burek, Churchill Mortgage

Mortgage pricing continues to meander within a range that we've been in for some time.  Most likely it will take something very significant to take us out of this range (higher or  lower), and while it seems there isn't any shortage of possibilities for this to happen, I think until we get much more clarity on where administration policy is headed we'll probably continue within this range. So, assess your risk tolerance and act accordingly knowing the only guarantee on your rate is if you lock it. -Hugh W. Page, Mortgage Banker, SeacoastBank

Today's Best-Execution Rates

  • 30YR FIXED - 4.0-4.125%
  • FHA/VA - 3.5 - 3.75%
  • 15 YEAR FIXED - 3.25%
  • 5 YEAR ARMS -  2.75 - 3.25% depending on the lender

Ongoing Lock/Float Considerations

  • Investors were relatively convinced that the decades-long trend toward lower rates had been permanently reversed after Trump became president, but such a conclusion would require YEARS to truly confirm

  • Instead of continuing higher in 2017, rates instead formed a narrow, sideways range, and held inside until April.  Investor perceptions are shifting such that fiscal reforms and other policy developments will need to live up to expectations in order to push rates higher.  Geopolitical risks would also need to avoid flaring up (more than they already have)
  • For the first time since the election, we're in a rate environment where you wouldn't be crazy not to lock at every little opportunity/improvement.  Until/unless it's broken, the highest rates of early-2017 mark the ceiling, and we're now waiting to see how much lower we can go from here.
  • Rates discussed refer to the most frequently-quoted, conforming, conventional 30yr fixed rate for top tier borrowers among average to well-priced lenders.  The rates generally assume little-to-no origination or discount except as noted when applicable.  Rates appearing on this page are "effective rates" that take day-to-day changes in upfront costs into consideration.