Today’s mortgage and refinance rates
Bond markets were closed yesterday. But average mortgage rates edged higher last Friday. And that means that they were at their highest since the spring. Still, they remain incredibly low by historical standards.
So far this morning, markets are suggesting that mortgage rates today might hold steady or just inch either side of the neutral line. However, the Job Openings and Labor Turnover Survey (JOLTS) report is due out at 10 a.m. (ET) and that may change the outlook.Find and lock a low rate (Oct 12th, 2021)
Current mortgage and refinance rates
|Conventional 30 year fixed||3.246%||3.263%||Unchanged|
|Conventional 15 year fixed||2.557%||2.586%||+0.03%|
|Conventional 20 year fixed||3.046%||3.08%||Unchanged|
|Conventional 10 year fixed||2.528%||2.586%||+0.02%|
|30 year fixed FHA||3.209%||3.971%||Unchanged|
|15 year fixed FHA||2.552%||3.196%||Unchanged|
|5/1 ARM FHA||2.406%||3.076%||Unchanged|
|30 year fixed VA||3.034%||3.226%||+0.03%|
|15 year fixed VA||2.753%||3.102%||+0.03%|
|5/1 ARM VA||2.501%||2.312%||Unchanged|
|Rates are provided by our partner network, and may not reflect the market. Your rate might be different. Click here for a personalized rate quote. See our rate assumptions here.|
COVID-19 mortgage updates: Mortgage lenders are changing rates and rules due to COVID-19. To see the latest on how coronavirus could impact your home loan, click here.
Should you lock a mortgage rate today?
Last Friday’s poor jobs report was sobering for investors. But not enough to stop them from pushing mortgage rates higher after the announcement.
And, if those employment numbers weren’t enough to stem rises in those rates, you might expect them to continue higher. That’s my view. And, while days and longer periods of falls are close to inevitable, I reckon the overall trend will likely continue upward.
So my personal rate lock recommendations remain:
- LOCK if closing in 7 days
- LOCK if closing in 15 days
- LOCK if closing in 30 days
- LOCK if closing in 45 days
- LOCK if closing in 60 days
However, I don’t claim perfect foresight. And your personal analysis could turn out to be as good as mine — or better. So you might choose to be guided by your instincts and your personal tolerance for risk.
Market data affecting today’s mortgage rates
Here’s a snapshot of the state of play this morning at about 9:50 a.m. (ET). The data, compared with roughly the same time last Friday, were:
- The yield on 10-year Treasury notes held steady at 1.60%. (Neutral for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields
- Major stock indexes were mixed soon after opening. (Neutral for mortgage rates.) When investors are buying shares they’re often selling bonds, which pushes prices of those down and increases yields and mortgage rates. The opposite may happen when indexes are lower
- Oil prices climbed to $80.81 from $79.62 a barrel. (Bad for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity.
- Gold prices dropped to $1,759 from $1,776 an ounce. (Neutral for mortgage rates*.) In general, it is better for rates when gold rises, and worse when gold falls. Gold tends to rise when investors worry about the economy. And worried investors tend to push rates lower
- CNN Business Fear & Greed index — edged up to 38 from 36 out of 100. (Bad for mortgage rates.) “Greedy” investors push bond prices down (and interest rates up) as they leave the bond market and move into stocks, while “fearful” investors do the opposite. So lower readings are better than higher ones
*A change of less than $20 on gold prices or 40 cents on oil ones is a fraction of 1%. So we only count meaningful differences as good or bad for mortgage rates.
Caveats about markets and rates
Before the pandemic and the Federal Reserve’s interventions in the mortgage market, you could look at the above figures and make a pretty good guess about what would happen to mortgage rates that day. But that’s no longer the case. We still make daily calls. And are usually right. But our record for accuracy won’t achieve its former high levels until things settle down.
So use markets only as a rough guide. Because they have to be exceptionally strong or weak to rely on them. But, with that caveat, mortgage rates today look likely to be unchanged or barely changed. But be aware that “intraday swings” (when rates change direction during the day) are a common feature right now.
Important notes on today’s mortgage rates
Here are some things you need to know:
- Typically, mortgage rates go up when the economy’s doing well and down when it’s in trouble. But there are exceptions. Read ‘How mortgage rates are determined and why you should care
- Only “top-tier” borrowers (with stellar credit scores, big down payments and very healthy finances) get the ultralow mortgage rates you’ll see advertised
- Lenders vary. Yours may or may not follow the crowd when it comes to daily rate movements — though they all usually follow the wider trend over time
- When daily rate changes are small, some lenders will adjust closing costs and leave their rate cards the same
- Refinance rates are typically close to those for purchases. And a recent regulatory change has narrowed a gap that previously existed
So there’s a lot going on here. And nobody can claim to know with certainty what’s going to happen to mortgage rates in coming hours, days, weeks or months.
Are mortgage and refinance rates rising or falling?
Today and soon
If there’s ever such a thing as a consensus among economists and Wall Street analysts, one seems to be emerging now. And it concerns the likelihood of the Federal Reserve plowing ahead with its plans to begin to withdraw its support for low mortgage rates come Nov. 3.
For 18 months, the Fed has been buying mortgage-backed securities (MBSs) at a rate of $40 billion a month as part of its cheap-money monetary policy. Those MBSs are the bonds that largely determine mortgage rates. And that action has been keeping mortgage rates artificially low.
But it’s been signaling for a while that it will probably “taper” (wind down) those purchases starting on Nov. 3. Some still think that last Friday’s disappointing employment situation report could cause the Fed to delay that start date, perhaps to mid-December. But most now seem to believe that the early-November date remains likely. Here’s CNBC’s take from yesterday:
The weaker jobs report, however, did little to assuage investor concerns that the Fed will soon look to pull back its bond buying program. Employment data is one indicator being used by the central bank to guide its timeline on tightening monetary policy. In fact, the 10-year yield rose above the 1.6% following the release of the report, hitting its highest level since June 4.
Other threats to low mortgage rates
The Fed isn’t the only force currently driving mortgage rates higher. Because, generally speaking, the better the economy’s doing, the higher those rates are.
And US gross domestic product (GDP) is currently growing at one of its fastest rates in several decades. However, it’s not all plain sailing. Indeed, over the weekend, Goldman Sachs said it’s expecting the economy to grow by 5.6% in 2021, down from the firm’s last estimate of 5.7%. And it’s forecasting growth next year of 4%, down from 4.4%.
Of course, those figures are bouncing back from extreme pandemic-induced lows. But so are mortgage rates. And I see little reason to think those rates won’t continue to rise, regardless of the Fed, even if GDP growth slows a little.
For more details about the Fed’s plans and other influences on mortgage rates, read last Saturday’s weekend edition of these daily reports.
Over much of 2020, the overall trend for mortgage rates was clearly downward. And a new, weekly all-time low was set on 16 occasions last year, according to Freddie Mac.
The most recent weekly record low occurred on Jan. 7, when it stood at 2.65% for 30-year fixed-rate mortgages. But then the trend reversed and rates rose moderately.
However, from April, those rises were mostly replaced by falls, though typically small ones. More recently, we had a couple of months when those rates barely moved. But, unfortunately, September brought some sharp rises.
Freddie’s Oct. 7 report puts that weekly average for 30-year, fixed-rate mortgages at 2.99% (with 0.7 fees and points), down from the previous week’s 3.01%.
Expert mortgage rate forecasts
Looking further ahead, Fannie Mae, Freddie Mac and the Mortgage Bankers Association (MBA) each has a team of economists dedicated to monitoring and forecasting what will happen to the economy, the housing sector and mortgage rates.
And here are their current rate forecasts for the remaining quarters of 2021 (Q3/21 and Q4/21) and the first two quarters of 2022 (Q1/22 and Q2/22).
The numbers in the table below are for 30-year, fixed-rate mortgages. Fannie’s were updated on Sept. 20 and the MBA’s on Sept. 22. But Freddie’s were last refreshed on July 15 because it now publishes these figures only quarterly. And its forecast is looking seriously stale.
However, given so many unknowables, the whole current crop of forecasts may be even more speculative than usual.
All these forecasts expect higher mortgage rates soon or fairly soon. But the differences between the forecasters are stark. And it may be that Fannie isn’t building in the Federal Reserve’s tapering of its support for mortgage rates while Freddie and the MBA are. Or perhaps Fannie believes tapering will have little impact.
Find your lowest rate today
Some lenders have been spooked by the pandemic. And they’re restricting their offerings to just the most vanilla-flavored mortgages and refinances.
But others remain brave. And you can still probably find the cash-out refinance, investment mortgage or jumbo loan you want. You just have to shop around more widely.
But, of course, you should be comparison shopping widely, no matter what sort of mortgage you want. As federal regulator the Consumer Financial Protection Bureau says:
Shopping around for your mortgage has the potential to lead to real savings. It may not sound like much, but saving even a quarter of a point in interest on your mortgage saves you thousands of dollars over the life of your loan.
Mortgage rate methodology
The Mortgage Reports receives rates based on selected criteria from multiple lending partners each day. We arrive at an average rate and APR for each loan type to display in our chart. Because we average an array of rates, it gives you a better idea of what you might find in the marketplace. Furthermore, we average rates for the same loan types. For example, FHA fixed with FHA fixed. The end result is a good snapshot of daily rates and how they change over time.