April 22, 2019
Mortgage rates were higher again on Monday, but just barely. The average lender was still in worse shape on Tuesday or Wednesday of last week when rates were the highest they'd been in about a month.
Rates reflect demand in the bond market. Bonds can be bought or sold for a variety of reasons, but one of the key reasons is the general levels of fear and optimism surrounding the economy. When investors are less certain about positive economic outcomes, they tend to buy more bonds. This results in rates moving lower.
That sort of uncertainty reached a bit of a boiling point at the end of March when the Fed called out economic uncertainty in Europe and China as one of the biggest risks to the global economic outlook. Since then, however, some of the data suggests the sky may not be falling just yet. As the fear/panic/uncertainty subsides--even if only slightly--investors have been dumping bonds and rates have been rising. To keep that rise in perspective, consider that rates in mid-March were still as low as they'd been in more than a year.
From here, investors will remain on guard for any big news on the economic data front. This week is fairly light in that regard although things will be picking up by Thursday and Friday.
Loan Originator Perspective
Rates rose Monday as oil price hikes exacerbated inflation concerns. We've bounced back to the top of recent rate ranges, now we'll see if the next move is further upward or back downward. I'm locking loans closing in the next 30 days, going case by case for those closing in 45 days. -Ted Rood, Senior Originator
Today's Most Prevalent Rates
- 30YR FIXED - 4.25%
- FHA/VA - 4.0%
- 15 YEAR FIXED - 3.875-4.00%
- 5 YEAR ARMS - 3.875-4.25% depending on the lender
Ongoing Lock/Float Considerations
- Early 2019 saw a rapid reevaluation of big-picture trends in rates and in markets in general
- The Federal Reserve has been a key player, and while they aren't the ones pulling the global economic strings, their response to the economy has helped rates fall more quickly than they otherwise might.
- Based on the Fed's laundry list of concerns, their current outlook for rate hikes and economic growth, and their bond-buying policy shifts, we've all but certainly seen the highest rates of this economic cycle in late 2018.
- 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.