November 19, 2012
Mortgage rates were higher to start the holiday-shortened week. Despite the deterioration, rates remain broadly consistent with a range that's been in effect for over a month. That range has seen few instances of deviation from 3.375% as a best-execution rate though some of the stronger days allow for certain scenarios at certain lenders to be competitively priced at 3.25%. Today's weakness means that 3.375% is the most prevalent Best-Execution rate for 30yr Fixed, Conventional Loans.
(Read More:What is A Best-Execution Mortgage Rate?)
US markets will be closed on Thursday for the Thanksgiving Holiday and will only be open half the day on Friday. While all mortgage lenders will be closed on Thursday, some will also remain closed on Friday. If you're considering locking a loan this week, you should check with your lender to determine whether or not they will be accepting locks on Friday, assuming you don't decide to lock before then.
Whereas markets fell under a barrage of volatility-inducing headlines last Friday, the current week is beginning in much calmer fashion with no major swings and a noticeable lack of participation. MBS prices (the Mortgage-Backed-Securities that most directly influence mortgage rates) had fallen to start the day, but slowly gained back about half the day's losses into the afternoon. When MBS prices move lower, rates tend to rise. Today's rebound hasn't yet been enough for lenders to release positively revised rate sheets.
Loan Originator Perspectives
"Rates are a little higher to start a holiday week that ends Wednesday, and appraisers are not prioritizing refinance inspections ahead of the holiday. So we're floating refinances into Monday 11/26 unless there's a material move lower in rates before then. As for purchases, this is the time of year when buyers can get the best deals because other buyers are preoccupied by holidays and sellers get jittery. Just remember: if you get into contract to buy a home Wednesday night through Sunday, you'll have to wait to lock your rate until Monday 11/26 because banks will be closed. " -Julian Hebron, Branch Manager, RPM Mortgage.
Today's Best-Execution Rates
- 30YR FIXED -3.375%
- FHA/VA - 3.25% (varies more between lenders than conventional 30yr Fixed)
- 15 YEAR FIXED - 2.875% - 2.75%
- 5 YEAR ARMS - 2.625-3.25% depending on the lender
Ongoing Lock/Float Considerations
- Rates and costs continue to operate near all time best levels
- Rates could easily move higher or lower, but given the nearness to all time lows, there's generally more risk than reward regarding floating
- This will always be the case when rates operate near all-time levels, and as 2011 showed us, it doesn't always mean they're done improving.
- (As always, please keep in mind that our talk of Best-Execution always pertains to a completely ideal scenario. There can be all sorts of reasons that your quoted rate would not be the same as our average rates, and in those cases, assuming you're following along on a day to day basis, simply use the Best-Ex levels we quote as a baseline to track potential movement in your quoted rate).