June 26, 2019
Mortgage rates hadn't moved much since last Friday--a good thing considering those levels were in line with the lowest levels in a long time. The ground-holding gave way today, however, as the underlying bond market weakened for the first time this week. In turn, mortgage rates quickly find themselves at this week's highs. But whether or not that means anything too troubling will depend on the lender in question. Most are still able to quote the same interest rate quoted yesterday with only minor differences in upfront costs.
Both stocks and bonds (which dictate rates) lost ground today. Considering they've both been gaining ground recently (not surprising due to the expectations for friendlier Fed policy--a rising tide that helps stocks move higher and rates move lower), this could be taken to mean that investors are taking some chips off the table ahead of the month-end bookkeeping deadline. Traders could also be cautious ahead of potential trade news that could come out of the G20 summit at the end of the week. Either way, volatility is on the horizon. If it's not this week's events that do the trick, next week's economic data could have a big impact.
Loan Originator Perspective
Bond markets regressed today, and rates rose slightly. Even though our overall trend is lower rates, they will always ebb/flow up and down over time. Risk averse clients closing within 45 days may want to lock, ensuring no lost sleep over their rates rising. - Ted Rood, Senior Originator
Today's Most Prevalent Rates
- 30YR FIXED - 3.875%
- FHA/VA - 3.5-3.75%
- 15 YEAR FIXED - 3.75%
- 5 YEAR ARMS - 3.625-4.125% depending on the lender
Ongoing Lock/Float Considerations
- Early 2019 saw a rapid reevaluation of big-picture trends in rates and in markets in general
- The Federal Reserve has been a key player, and while they aren't the ones pulling the global economic strings, their response (and even their EXPECTED response) to the economy has helped rates fall more quickly than they otherwise might.
- Based on the Fed's laundry list of concerns, the bond market (which determines rates) will be watching economic data closely, both at home and abroad, as well as trade-related concerns. 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.