April 7, 2017
Mortgage rates rose modestly today, compared to yesterday's latest levels. Compared to the morning's rate sheets however, the rise was sharper, but even then, we're talking about fairly small movement in the bigger picture. 4.125% is still easily the most prevalent conventional 30yr fixed quote for top tier scenarios, with the only change being in the form of slightly higher upfront cost.
It was a volatile day for financial markets with news of air strikes in Syria being the focal point for overnight trading. Bond markets (which dictate mortgage rates) started the day off in much better shape as a result. Rates only found more benefit from the big jobs report, which was much weaker than expected. Weaker economic data tends to motivate bond buying and thus, lower rates.
All of the rate-friendly developments turned out to be too much of a good thing. Any trader inclined to buy bonds (which, again, pushes rates lower) had done so shortly after the jobs report came out. With buyers burnt out, sellers were in the majority. As such, the rest of the day was resigned to a paradoxical move toward higher rates.
Loan Originator Perspective
Despite the US missile assault on Syria and a tepid March NFP report, bonds sold off this afternoon, and multiple lenders worsened pricing. When rates rise despite bond friendly data/world events, it's time to pay attention. Pricing is still near best in a month, and it looks like markets have no desire to improve further. Locking is the smart play here. -Ted Rood, Senior Originator
Roller coaster day for bonds. Usually not a fan of locking on a Friday. However, if your pricing is better today than what you were offered yesterday, I would pull the trigger. Bonds just do not want to break the current floor. -Victor Burek, Churchill Mortgage
Today's Best-Execution Rates
- 30YR FIXED - 4.125%
- FHA/VA - 3.75-4.00%
- 15 YEAR FIXED - 3.375-3.5%
- 5 YEAR ARMS - 2.75 - 3.25% depending on the lender
Ongoing Lock/Float Considerations
- Some investors are increasingly worried/convinced that the decades-long trend toward lower rates has been permanently reversed, but such a conclusion would require YEARS to truly confirm
- Still, it would take something very big and unexpected for rates to make a big, sustained push back toward pre-election levels. Even then, it would take time to confirm such a shift.
- With fiscal and monetary policy paths both clearly putting pressure on rates, at least one of those would need to make a noticeable change before anything but a cautious, lock-biased approach makes sense as a baseline strategy. Floating should only be considered as a tactical opportunity to capitalize on temporary corrections.
- 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.