Mortgage rates were sharply higher yesterday, but managed to reverse course and make some gains today.  The refreshing part of the improvement was that the bond market (which underlies rates) was already holding its ground before there was any obvious reason to do so.  Simply put, this suggests that investors could view current rates as being high enough to be considered a good buying opportunity.  That's a complicated way of saying rates could be running into a ceiling here.

A word of caution though: it's never possible and seldom a good idea to read much into longer-term trends based on one day of bond market movement.  The risk remains that the lowest rates we'll see for a while have already been seen at the beginning of September.  What we're hoping to avoid is simply a runaway surge toward higher rates.  Today's gains suggest that's possible, but it will ultimately come down to the balance of economic data at home and abroad in the coming weeks/months. 

Loan Originator Perspective

Following reports that the trade deal is not a done thing and a stellar 10year bond auction, I would recommend to float overnight.   Bonds have regained all of yesterday's losses but rate sheets do not reflect any of those gains yet.    The trend hasn't been our friend lately, so if your lender reprices for better later today, then consider locking in the gains.  If no reprice better, than I feel it is worth it to float overnight. -Victor Burek, Churchill Morgtgage

Bonds rebounded slightly Wednesday, as tariff progress appeared to stall and a Treasury auction saw strong demand.  MBS are still down considerably from late October's levels, but at least we didn't lose ground today.  I'm locking many December closings, depending on borrowers' risk tolerance. -Ted Rood, Senior Originator

Today's Most Prevalent Rates For Top Tier Scenarios 

  • 30YR FIXED -3.75-3.875%
  • FHA/VA - 3.375-3.5%
  • 15 YEAR FIXED - 3.375-3.5% 
  • 5 YEAR ARMS -  3.25-3.75% depending on the lender

Ongoing Lock/Float Considerations 

  • 2019 has been the best year for mortgage rates since 2011.  Big, long-lasting improvements such as this one are increasingly susceptible to bounces/corrections 

  • Fed policy and the US/China trade war have been key players.  Major updates on either front could cause a volatile reaction in rates

  • The Fed and the bond market (which dictates rates) will be watching economic data closely, both at home and abroad, as well as trade war updates. 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.