Mortgage rates edged up to the highest levels in several weeks today.  Only a handful of days from mid-May stand between current levels and the highest rates in 7 years.  That sounds a bit more dramatic than it is.  Rates have been pretty close to these highs during the 2nd half of last week and just happened to move in an unfriendly direction by a medium-small amount today.

The middle of the week is more worthy of anxiety and anticipation.  Between the important economic reports and the announcements from major central banks (the Fed and the European Central Bank) rates could easily be shooting to new long-term highs or surging triumphantly lower--at least in the context of the recent range.  We're not talking about 30yr fixed rates rising above 5% or below 4%, but it's not uncommon to see a move of .125%-.25% when the stars align on these sorts of weeks.

Loan Originator Perspective

Bonds slumbered through a treasury auction today, while waiting for inflation data, Wednesday's Fed Statement, the North Korean summit, and ECB statement.   All in all, promises to be an exciting week.  I'm still locking early, for all but the most aggressive clients. - Ted Rood, Senior Originator

With a lot of moving parts throughout the World I still advise locking at origination to preserve gains. -Al Hensling

My clients and i continue to believe that locking is the way to go.  The trend continues to not be our friend and any improvements will have to come from unexpected sources such as breaking news events which makes floating very risky. -Victor Burek, Churchill Mortgage

Today's Most Prevalent Rates

  • 30YR FIXED - 4.625-4.75%
  • FHA/VA - 4.375%
  • 15 YEAR FIXED - 4.00%
  • 5 YEAR ARMS -  3.75-4.25% depending on the lender

Ongoing Lock/Float Considerations

  • Rates have 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.