Mortgage rates improved moderately today following the release of the GOP tax bill and confirmation of Jerome Powell as Trump's Fed Chair nomination.  "Confirmation" actually isn't quite the right word in this case because Powell actually does need to be technically "confirmed" by the Senate before he's officially the new Fed Chair.  What we got today was simply confirmation that several weeks of rumors and press leaks were accurate. Bond markets (and thus, interest rates) had already moved in anticipation of the Powell nomination, and it ended up having limited impact by the time it became official.

Exerting far more dominance over the landscape of financial news headlines today was the grand unveiling of the House tax bill.  Weighing in at over 400 pages, it's no small task to break down all of the details and their likely corresponding effects on rates.  Moreover, it's unlikely that this iteration of the bill will pass without revisions--potentially significant revisions.  The best option from a market-watching standpoint is simply to observe that interest rates fell when the news first came out.  Stocks fell too, but unlike rates, they ended up bouncing back by the end of the day.  Expect to hear more and more about the tax plan in the coming weeks.

For now, rates are as low as they've been in the past 2 weeks, but there's not an exceptionally wide margin between the highs and lows during that time.  The average lender continues quoting 4.0% on top tier 30yr fixed scenarios, although more aggressive lenders are slightly lower.  Tomorrow brings the big jobs report, which historically has a lot of market-moving street cred, but investors have recently been less eager to react to it in favor of inflation data and fiscal headlines.

Loan Originator Perspective

Bond markets reacted well to Jerome Powell's formal nomination to Fed Chairman, and posted moderate gains. I can't call this a trend yet, but with a few more green days it could become one. Tomorrow's NFP jobs report almost feels inconsequential, as gains are less important than inflation data these days. Conservative borrowers should lock here, those who don't mind a modicum of risk may want to see what tomorrow brings.  -Ted Rood, Senior Originator

Today's Most Prevalent Rates

  • 30YR FIXED - 4.0%
  • FHA/VA - 3.75% 
  • 15 YEAR FIXED - 3.375%
  • 5 YEAR ARMS -  2.75 - 3.25% depending on the lender

Ongoing Lock/Float Considerations

  • 2017 had proven to be a relatively good year for mortgage rates despite widespread expectations for a stronger push higher after the presidential election in late 2016. 

  • While rates remain low in absolute terms, they've moved higher in a more threatening way heading into the 4th quarter, relative to the stability and improvement seen earlier in 2017

  • The default stance for now is that this trend toward higher rates has the potential to continue.  It will take more than a few great days here and there for that outlook to change.

  • For weeks, this bullet point had warned about recent stability inviting a bigger dose of volatility.  That volatility is now here.  As such, locking is generally the better choice until the volatility is clearly dying down.
  • 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.