November 6, 2017
Mortgage rates continued lower today, despite a blatant lack of underlying motivation in financial markets. By that, I mean that we haven't seen any obvious cause and effect relationships between news, economic data, and bond market movements (which, in turn, drive interest rate movements). Instead, bonds moved of their own volition. While the move was modest, it was the 6th improvement in the past 7 business days. The net effect is the best mortgage rate offerings in 3 weeks.
Several of the more aggressive lenders are again quoting top tier 30yr fixed rates of 3.875% while many remain at 4.0%. In cases where today's quoted interest rate is the same as Friday's, borrowers will generally be seeing lower upfront costs (or higher upfront lender credits, depending on the scenario).
The rest of the week doesn't offer too much in terms of scheduled events that promise to stir volatility in financial markets. That said, volatility could still come from UNscheduled events, especially if they concern any major announcements of progress on the tax reform front (House leaders are actively working on making changes to the tax bill that would increase its odds of making it through the Senate). In general, successful tax reform is seen as putting upward pressure on rates, all other things being equal, but the extent of that pressure will depend on the details.
Today's Most Prevalent Rates
- 30YR FIXED - 3.875-4.0%
- FHA/VA - 3.75%
- 15 YEAR FIXED - 3.25-3.375%
- 5 YEAR ARMS - 2.75 - 3.25% depending on the lender
Ongoing Lock/Float Considerations
- 2017 had proven to be a relatively good year for mortgage rates despite widespread expectations for a stronger push higher after the presidential election in late 2016.
- While rates remain low in absolute terms, they've moved higher in a more threatening way heading into the 4th quarter, relative to the stability and improvement seen earlier in 2017
- The default stance for now is that this trend toward higher rates has the potential to continue. It will take more than a few great days here and there for that outlook to change.
- For weeks, this bullet point had warned about recent stability inviting a bigger dose of volatility. That volatility is now here. As such, locking is generally the better choice until the volatility is clearly dying down.
- 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.