Mortgage rates were very nearly unchanged today, although the average lender was just slightly higher.  Investors reacted to news over the weekend that the US/China tariff deadline would be extended.  While that doesn't have anything to do with mortgage rates, it set market forces in motion that created the modest, indirect effect.

The looming tariff deadline had been a source of uncertainty for markets.  All other things being equal, uncertainty tends to promote some safe-haven buying in bonds and some weakness in stocks.  When investors are buying more bonds, it helps push rates lower (or keep them from going higher).  Of course, this uncertainty trade must be balanced against a variety of other considerations for investors.  Moreover, the news in question wasn't a solution to the trade negotiations--just a delay.  As such, it didn't have huge repercussions for markets.

Potentially more important will be congressional testimony tomorrow with Federal Reserve Chair Jerome Powell.  The Fed's policies don't dictate the longer-term direction of rates, but they can definitely create short-to-medium-term volatility.  With numerous Fed members out last week voicing opinions on key policy changes, Powell's testimony many well solidify the market's expectations heading into the next Fed meeting in just over 3 weeks.  That could create some bigger movements for rates than we've seen recently

Loan Originator Perspective

Bonds continue to be tightly locked within an ever narrowing range.  I'm still locking loans closing within 30 days.  There's a lot of data hitting Friday that could swing rates up/down, and I don't want my clients on the wrong side if/when rates rise.   -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.