February 8, 2019
Mortgage rate may not be quite as low as they were on January 31st, but they nonetheless managed to end at the lowest levels of this week. Unlike January 31st, we can still say we're at the lowest levels in more than a year (yesterday was the first official day for that distinction).
All of this is beside the point. We're effectively as low as we've been in a long time. The average lender is once again able to quote conventional 30yr fixed rates below 4.5% for the best-qualified borrowers.
Beyond that, there's at least an equal chance that rates could go lower in the short-to-medium term depending on economic data and the resolution (or lack thereof) of several lingering uncertainties. Those uncertainties include but are not limited to the status of the government shutdown, the March 1st US/China tariff deadline, the Brexit process in Europe, and the ability (or lack thereof) of the stock market to get back to 2018's highs.
Loan Originator Perspective
This week's MBS chart shows consistent gains from mid-day Monday through Friday PM. While the total net gains (just over .25% pricing improvement) aren't earth-shattering, rates' downward trend is encouraging. I'm not in a big hurry to lock new applications here. -Ted Rood, Senior Originator
Today's Most Prevalent Rates
- 30YR FIXED - 4.375 - 4.5%
- FHA/VA - 4.125 - 4.25%
- 15 YEAR FIXED - 4.0 - 4.125%
- 5 YEAR ARMS - 4.25 - 4.625% depending on the lender
Ongoing Lock/Float Considerations
- Headwinds that had plagued rates for most of the past 2 years began to die down in late 2018. A rapid decline in the stock market certainly helped drive investors into bonds (which helps rates) Highest rates in more than 7 years in Oct/Nov. 8-month lows by the end of the year
- This is a bit of a crossroads. The rising rate environment could flare up again. We may look back at Oct/Nov and see a long-term ceiling, or we may look back at early December and see a temporary correction before more pain.
- Either way, late 2018 was a sign that rates are willing to take opportunities presented to them. From here, it will be up to economic data, fiscal policies, and the stock market to decide on the next set of opportunities. The rougher the overall outlook, the better interest rates tend to do.
- 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.