July 19, 2019
Mortgage rates Moved just slightly lower today, despite some push back from underlying bond markets. Typically, weakness in the bond market (like the kind we saw today) corresponds to rising rates--even if only a modest amount. The compensating factor today was the timing of yesterday's bond market gains.
Simply put, there is a bit of lag between bond market movement and mortgage lenders' ability or willingness to pass those gain along in terms of improved rates. Additionally, in this more volatile environment with rates already very close to super long-term lows, lenders are generally hesitant match the bond market's movement step for step.
All of the above left lenders with some insulation against today's bond market weakness. Had it been any bigger, we probably would be talking about slightly higher rates today.
Loan Originator Perspective
My clients and i continue to favor locking. News broke today that the fed will most likely just cut 25bps, and not the 50bps some were expecting. This immediately caused a move higher in treasury yields, albeit a very small one. But could be a hint to what will come when the fed decision hits. - Victor Burek, Churchill Mortgage
Today's Most Prevalent Rates
- 30YR FIXED - 3.875%
- FHA/VA - 3.625%
- 15 YEAR FIXED - 3.5-3.625%
- 5 YEAR ARMS - 3.375-3.75% 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.