Mortgage rates hit their lowest levels of the month today!  Sure, that's only 10 business days for the mortgage world, but we'll take every little victory we can get these days.  Why is that?  Because "these days" have been pretty rough.  Exactly one week ago, rates were at their highest levels in nearly 8 years.

The assertion about today's rates runs counter to quite a few news stories.  Major media outlets are reporting rates as being 'unchanged' this week.  That wasn't necessarily incorrect until today. In those cases, reporters are relying on Freddie Mac's weekly survey data.  The survey only collects responses from Monday through Wednesday and the results tend to over-represent Monday and Tuesday's rates on any given week.  Long story short, as of yesterday, it would have been fair to say rates were indeed unchanged this week.  Nearly all of the improvement happened today.

The likelihood of additional improvements remains to be seen.  As far as the past several months are concerned, we really haven't seen stretches of good luck look much better than this one.  As such, those who'd been floating last week may want to consider locking this week, assuming that's an option.  It's not out of the question for rates to improve further, but that's dependent on several other volatile variables.  

Loan Originator Perspective

Bond markets posted small gains today, while rates remained above early November levels.  While Brexit discord may still become a factor, it appears our mini-rally is hitting resistance levels.  I'm recommending risk averse clients lock in these gains, for loans closing within 30 days. -Ted Rood, Senior Originator

Today's Most Prevalent Rates

  • 30YR FIXED - 5.0%
  • FHA/VA - 4.5%-4.75%
  • 15 YEAR FIXED - 4.5%-4.625%
  • 5 YEAR ARMS -  4.375%-4.875% depending on the lender

Ongoing Lock/Float Considerations

  • Rates continue coping with several big-picture headwinds, including: the Fed's rate hike outlook (and general policy tightening), the increased amount of Treasury issuance to pay for the tax bill (higher bond issuance = higher rates), and the possibility that fiscal stimulus results in higher growth/inflation (which certainly seems to be the case so far in 2018).

  • While rates were able to recover and stay sideways in the summer months, September and October have seen a surge up to the highest levels in more than 7 years. 

  • Upward pressure can continue as long as economic growth and inflation continue running near long-term highs.  Stay defensive (i.e. generally more lock-biased).  It will take a big change in economic fundamentals or geopolitical risk for the big picture to change.  Such things tend to not happen as quickly as we'd like.
  • 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.