At one point today, there were three apparently important events dominating the newswires simultaneously.  These included the Fed Chair's congressional testimony, the Cohen congressional testimony, and--you guessed it--congressional testimony from Lighthizer on US/China trade policy.  Mortgage rates are determined by the bond market, and the bond market could make a case for caring about any of these three events.  Interestingly enough, almost all of the day's bond market movement arrived BEFORE any of the testimonies.

Unfortunately, the movement in question was bad for rates, but the damage was fairly minimal.  The average lender is still able to quote the same rates as yesterday, but the upfront costs would be slightly higher.

Tomorrow, rates will have another chance to pay attention to the news when the 4th quarter GDP revision is finally released after being delayed by the government shutdown.  Analysts are expecting the number to come in at 2.3% versus an initial estimate of 3.5%.  If it manages to come in much higher than that, it could put additional upward pressure on rates.

Loan Originator Perspective

New day, but same story for bonds as we remain locked in an exceptionally narrow range.  We do get meaningful GDP and inflation data Thursday/Friday,  but I doubt it'll be sufficient to change bonds' outlook.  I'm locking loans closing within 30 days. -Ted Rood, Senior Originator

Bonds bounced again off of resistance around 2.62 on the 10yr and look like they want to test the top end of the range.   With the better rate sheets i am seeing this morning, i believe it is best to go ahead and lock in. -Victor Burek, Churchill Mortgage

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.