Mortgage rates hit the lowest levels in 8 years either today or yesterday, depending on the lender, just narrowly edging out the rates seen in early July 2016.  There are multiple caveats, however.  First off, lenders are responding to recent market movements in different ways.  Some lenders move down faster and then remain flat even as the bond market (which dictates rates) improves.  Other lenders have been slow to react, but have since moved down more steadily.  Still others are somewhere between those extremes.

Perhaps the most important thing to note about mortgage rates this week is that, while they are certainly at long-term lows, they are absolutely NOT moving lower as fast or as much as US Treasury yields.  I discussed this in greater detail in the previous rate article and then again this morning on the MBS Commentary blog.  Click the links to get caught up, if you're curious.

Loan Originator Perspective

Wuhan contagion appears inevitable, bond yields are at all time lows, but mortgage rates have scarcely budged the last couple of days.  The prospects for significantly lower rates are far from certain, but also appears rates are unlikely to rise quickly.  I am locking March closings, floating most loans closing April and beyond. - Ted Rood, Senior Originator


Today's Most Prevalent Rates For Top Tier Scenarios 

  • 30YR FIXED - 3.25-3.375%
  • FHA/VA -3.00%
  • 15 YEAR FIXED - 3.00% 
  • 7 YEAR ARMS -  2.875-3.125% 

Ongoing Lock/Float Considerations 

  • 2019 was the best year for mortgage rates since 2011.  Big, long-lasting improvements such as this one are increasingly susceptible to bounces/corrections, but 2020's coronavirus outbreak has provided a second wind for low-rate momentum

  • Fed policy, trade negotiations, and the 2020 presidential election will all play a part in driving rate momentum as the year progresses.

  • The Fed and the bond market (which dictates rates) will be watching economic data closely, both at home and abroad to see just how much of an impact coronavirus will have.  Once it looks like that impact is waning, we could see sharp upward pressure in rates (unless another rate-friendly variable steals the show), but that would require a similar bounce in the economic data that has already begun to suffer due to coronavirus. 
  • 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.