October 25, 2019
Mortgage rates moved lower for 3 days in a row as of yesterday afternoon. But that trend was likely to reverse based on the timing of yesterday's market movement. Specifically, the market was suggesting mortgage lenders should raise their rates, but not quite urgently enough (or early enough in the day) for lenders to pull the trigger at the time. As such, it was a strong possibility that we'd see lenders make those adjustments with today's first rate sheets.
Things actually deteriorated a bit from there. Once again, bond markets were unable to maintain modest improvement from the overnight trading session. As bond prices move lower and yields move higher, lenders are increasingly forced to "reprice" their mortgage rate sheets (i.e. they change the rates they're offering in the middle of the business day). Multiple lenders repriced for the worse today, bringing rates back up toward their highest levels in more than a month.
Loan Originator Perspective
Bonds regressed Friday, nearing their worst levels of the week. Granted, we've been in a fairly narrow range, but it's still discouraging to lose ground. There's either no trend at present, or if there is one, it's towards higher rates. I'm continuing to lock loans closing within 45 days as soon as I can. -Ted Rood, Senior Originator
Today's Most Prevalent Rates
- 30YR FIXED -3.75-3.875%
- FHA/VA - 3.375-3.5%
- 15 YEAR FIXED - 3.375-3.5%
- 5 YEAR ARMS - 3.25-3.75% depending on the lender
Ongoing Lock/Float Considerations
- 2019 has been the best year for mortgage rates since 2011. Big, long-lasting improvements such as this one are increasingly susceptible to bounces/corrections
- Fed policy and the US/China trade war have been key players. Major updates on either front could cause a volatile reaction in rates
- The Fed and the bond market (which dictates rates) will be watching economic data closely, both at home and abroad, as well as trade war updates. The stronger the data and trade relations, the more rates could rise, while weaker data and trade wars will lead to new long-term lows.
- 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.