December 22, 2017
Mortgage rates didn't move much today, which is a victory unto itself on a week with 3 of the worse consecutive days of the year. In fact, lenders that changed rates at all today generally offered slight improvements in terms of upfront costs. In other words, quoted rates remained unchanged, but some lenders slightly decreased the costs associated with those rates (or increased the available lender credit) by a fraction of a point.
Despite the presence of several economic reports that would typically have some impact on intraday rate movements, bond markets were stone silent today--a reflection of the impending holiday weekend. Lenders will of course be closed on Monday for Christmas. In the shortened week that follows, lenders tend to play things fairly conservatively, meaning risk and reward for floating are both muted (risk is muted because the conservative strategies are already in place).
Loan Originator Perspective
Enjoy the holiday weekend, and float. Besides losing a few days on your lock with the weekend, and holiday, today is an early market close, and the markets have checked out for the weekend. Watch again on Tuesday, though we still may see a quiet week. -Ira Selwin - VP of Capital Markets at US Mortgage Corporation
It was a predictably slow day in bond markets Friday, as prices eased up slightly. While we haven't lost further ground the last two days, we're still near the worst levels since last May. The rest of this year will likely be sedate, until January arrives with more budget and infrastructure improvement DC drama. I'll lock applications within 30 days of closing, no reason to float here. Merry Christmas, all! -Ted Rood, Senior Originator
I have never liked locking on the final day ahead of a holiday weekend, and this weekend is no different. With the recent rise in rates, i think it would be worth the risk to float into next week. It is month, quarter and year end which can be supportive for bonds. -Victor Burek, Churchill Mortgage
Today's Most Prevalent Rates
- 30YR FIXED - 4.125%
- FHA/VA - 3.75%
- 15 YEAR FIXED - 3.375%-3.5%
- 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.