Mortgage rates caught a break today, as underlying bond markets made it back into Tuesday's territory.  Refreshingly, lenders were willing to set rates back at Tuesday's levels.  That may sound exceedingly logical considering bond markets dictate rate movements, but it's an exception to the recent rule that's seen lenders err on the side of caution when it comes to following every little movement in bonds.

In other words, lenders have been quick to raise rates when bonds are weaker and slow to bring them back down when bonds recover.  That makes today something of an opportunity for anyone who wished they'd locked their rate on Tuesday.  Simply put, now you can!  

These sorts of recoveries are tricky business from a forecasting perspective.  Of course there's a temptation to hope for more when we see a nice improvement after so much weakness, but there are many examples of days like today giving way to higher rates in the coming days.  With no way to know for sure, and with benchmark rates like the 10yr Treasury yield close to scary tipping points between 4 and 6 year highs, it makes sense to remain cautious from a lock/float standpoint.

Loan Originator Perspective

Still above 2.99 so despite taking a break from daily losses there isn't much to be happy about.  Feeling very defensive and anyone under 60 days should consider locking.     -Jason Anker - Loan Officer 

Bond markets reversed yesterday's losses today, and treasury yields slipped back under 3%.  They remain at highest levels since Jan 2014,  however, and mortgage rates are highest since late summer 2013.  Locking early is still the smart play here, we're nowhere close to breaking the rising rate trend yet. -Ted Rood, Senior Originator

Choppy Waters currently, still suggest locking at origination. Mixed signals from Equity Markets as earnings are mostly above expectations but not driving stock prices. -Al Hensling

Today's Most Prevalent Rates

  • 30YR FIXED - 4.625%-4.75%
  • FHA/VA - 4.25%-4.5%
  • 15 YEAR FIXED - 4.0%
  • 5 YEAR ARMS -  3.625%-3.875% 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 been moving higher in a serious way due to headwinds that cannot be quickly defeated.  These include the Fed's increasingly restrictive monetary policy outlook, the increased amount of Treasury issuance to pay for the tax bill (higher bond issuance = higher rates), and the possibility that fiscal stimulus results in higher growth/inflation.

  • While we may see periodic corrections to the broader trend toward higher rates, it's safer to assume that broader trend can and will continue.  Until that changes, it makes much more sense to remain heavily-biased toward locking as opposed to floating.
  • 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.