Today’s mortgage and refinance rates
Happy Valentine’s Day! Average mortgage rates edged a little higher last Friday. But key markets were spooked by the possibility of a Russian invasion of Ukraine. And mortgage rates fell a bit on Saturday.
So far this morning, key markets are giving mixed messages. And mortgage rates today might move either way. But, with so much uncertainty and volatility, some movement looks likely.
Current mortgage and refinance rates
|Conventional 30 year fixed||4.132%||4.153%||Unchanged|
|Conventional 15 year fixed||3.345%||3.375%||Unchanged|
|Conventional 20 year fixed||3.825%||3.858%||Unchanged|
|Conventional 10 year fixed||3.445%||3.502%||+0.18%|
|30 year fixed FHA||4.261%||5.046%||+0.15%|
|15 year fixed FHA||3.528%||4.094%||Unchanged|
|30 year fixed VA||4.031%||4.233%||Unchanged|
|15 year fixed VA||3.386%||3.717%||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.|
Should you lock a mortgage rate today?
Read on for my analysis of what the situation between Russia and Ukraine could mean for mortgage rates. Right now, it might have the potential to bring lower rates at least for some weeks. But that’s far from certain. And depends on whether Russia actually invades and at what scale.
Clearly, I have no insights into the possible scenarios beyond the ones you have. It wouldn’t necessarily be a terrible idea for you to continue to float your mortgage rate and gamble on bad things happening. You might win big. Though the risks are obvious and the stakes might be high.
Me? I’m not much of a gambler when it comes to mortgage rates. 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
>Related: 7 Tips to get the best refinance rate
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 fell back to 1.99% from 2.01%. (Good for mortgage rates.) But they were rising this morning. More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields
- Major stock indexes were mostly lower but not sharply so. (Good 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. But this is an imperfect relationship
- Oil prices moved higher to $92.76 from $91.01 a barrel. (Bad for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity
- Gold prices climbed to $1,864 from $1,832 an ounce. (Good 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 – fell to 32 from 40 out of 100. (Good 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 are unpredictable. However, 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.
A lot is going on at the moment. 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?
Everything changed for mortgage rates last Friday. Well, maybe. The trigger was White House national security adviser Jake Sullivan’s warning that military action by Russia against Ukraine could occur during the Beijing Winter Olympics, which end this week.
Many markets were spooked, including those closely related to mortgage rates. And I was relieved that I’d mentioned Ukraine that morning as one of the possible triggers for lower mortgage rates.
Might the Ukrainian effect cause mortgage rates to fall by worthwhile amounts? It might. But that will depend on whether Russia actually invades the country (it says it won’t) and what any such invasion looks like. A brief incursion and withdrawal would be very different from a full–scale invasion and permanent occupation.
Equally, the responses of the rest of the world would determine how much economic damage would be done – and so how low mortgage rates might go and for how long. Sanctions threatened so far would certainly damage Russia’s economy greatly.
But there’d be a knock–on effect on the global economy, with Europe hit especially hard. Sixty percent of Russia’s oil exports go to Europe. And, as The Wall Street Journal (paywall) put it yesterday:
The threat of a Russian invasion of Ukraine is shaking up a fragile global oil market, pushing prices closer to $100 a barrel as traders calculate that supplies will struggle to cushion the effect from any significant disruption in Russian fossil fuel exports.
Understandably, markets are spooked by the prospect of such an invasion. And the threat is very real.
However, there’s a reasonable chance nothing will happen. Right now, Russia claims that it is merely conducting military exercises and has no intention of invading.
Of course, few take the word of Russian President Vladimir Putin at face value. But it would be far from out of character for him to be playing games by trolling the West. Even the US intelligence community added the caveat that Russian officials are masters of misinformation when it warned last week of an imminent invasion.
The fact is nobody knows what Mr. Putin will do next, quite possibly including Mr. Putin.
But we should probably expect mortgage rates to remain subdued for as long as the threat of invasion remains credible. And to move up and down as perceptions of that threat rise and fall.
If the invasion actually comes, expect mortgage rates to tumble until its scale becomes clear. If it turns out to be a temporary, brief and shallow incursion, they might begin to recover. But, if sanctions are severe, they may remain low.
Of course, if Russia brings its “exercises” to an end and withdraws its forces from the area without any invasion or incursion, mortgage rates may well recover and resume rising.
And your guess as to which of those scenarios is most likely is as good as mine.
For a more detailed look at what’s happening to mortgage rates, read the latest weekend edition of this report.
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 that year, according to Freddie Mac.
The most recent weekly record low occurred on Jan. 7, 2021, when it stood at 2.65% for 30–year fixed–rate mortgages.
Since then, the picture has been mixed with extended periods of rises and falls. Unfortunately, since last September, the rises have grown more pronounced, though not consistently so. So far in 2022, rises have been appreciable and relatively consistent.
Freddie’s Feb. 10 report puts that weekly average for 30–year, fixed–rate mortgages at 3.69% (with 0.8 fees and points), up from the previous week’s 3.55%.
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 four quarters of 2022 (Q1/22, Q2/22, Q3/22, Q4/22).
The numbers in the table below are for 30–year, fixed–rate mortgages. Fannie’s were published on Jan. 19 and Freddie’s and the MBA’s on Jan. 21.
Personally, I was surprised that Fannie Mae only slightly increased its rate forecasts in January. It believes that rates for 30–year, fixed–rate mortgages will average 3.2% over the current quarter. But, on the day its figures were published, we reported those for conventional loans were already up to 3.87%.
Do Fannie’s economists expect those rates to plummet later this month or in February or March and remain lower in the following quarters? If so, they know something that I don’t. And that their peers in Freddie and the MBA’s teams don’t, either, though I’m less optimistic than any of them.
Of course, given so many unknowables, the whole current crop of forecasts may be even more speculative than usual.
Find your lowest rate today
You should comparison shop 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.
The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.