Mortgage rates didn't really improve today for the average lender, but they did manage to hit the lowest rates in 2 months on a technicality.  The reason for this is simple.  There was a big gap between the rates seen on October 2nd and October 3rd.  Rates merely had to hold steady today in order to earn the "2-month" title.  

Despite the absence of mortgage rate movement, there were some encouraging developments behind the scenes.  When it comes to rates, 'behind the scenes' refers to trading in the bond market, and bonds managed to scratch out a solid day after starting out on weaker footing.  Typically, bonds need some inspiration for this sort of strength.  That can come from weaker economic data, weakness in stocks or other related markets, and even from geopolitical drama.  Today's strength, however, arrived without any obvious external prompt. 

Given that we were already seeing the best levels in nearly 2 months, this sort of strength is especially encouraging.  It means markets are giving serious consideration to the possibility of a broader correction in rates (i.e. a bigger push to lower levels).  Don't bank on such things yet.  Just know that the conversation has been opened.  

Loan Originator Perspective

Bonds consolidated last week's gains today, as treasury yields fell just below the important 3.0 level.  Tomorrow has scant data to inform rates, but Wednesday-Friday are jam packed.  We'll know a lot more on where markets are headed by then.  For now, I'm locking applications closing within 30 days, hoping that sentiment changes by Friday.    -Ted Rood, Senior Originator

Bonds managed to rally back after a down open.  Since most rate sheets came out before bonds rallied, i favor floating over night.   If you receive a reprice for the better, you should consider locking but for those that can tolerate a little risk, i would float to see if this rally can extend over the next couple days. -Victor Burek, Churchill Mortgage

Today's Most Prevalent Rates

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

Ongoing Lock/Float Considerations

  • Headwinds that had plagued rates for most of the past 2 years are slowly dying down.  The rising rate environment could flare up again, and some headwinds remain in effect, but the broader tone has taken a more optimistic shift.

  • Highest rates in more than 7 years in Oct/Nov.  Lowest rates in more than 2 months as of early December

  • This is a bit of a crossroads.  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, it's one of the more hopeful positions we've been in for several years.
  • 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.