Today’s mortgage and refinance rates

Average mortgage rates tumbled yesterday. And that wiped out more than two weeks of rises. But, of course, those rates are still significantly higher than they were at the start of the year – or the month.

And there may be more good news today. Because markets are signaling that mortgage rates today might fall again.

Current mortgage and refinance rates

Program Mortgage Rate APR* Change
Conventional 30 year fixed 3.954% 3.977% -0.14%
Conventional 15 year fixed 3.357% 3.393% -0.14%
Conventional 20 year fixed 3.836% 3.872% -0.13%
Conventional 10 year fixed 3.27% 3.339% -0.15%
30 year fixed FHA 4.147% 4.91% -0.11%
15 year fixed FHA 3.597% 4.219% -0.15%
30 year fixed VA 4.058% 4.264% -0.12%
15 year fixed VA 3.63% 3.98% +0.27%
5/1 ARM VA 4.75% 3.9% -0.03%
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?

On the day I wrote, “It’s the Fed, stupid!” markets took me down. True, I predicted a fall yesterday. But I wasn’t expecting such a significant one.

As it turns out, the Federal Reserve was last Friday’s focus. And the cumulative economic effect of the international community’s sanctions on Russia dominated market movements yesterday. And still is this morning.

But for how long will that last? I shouldn’t be surprised if it were to end soon.

Read on to discover why I think investors might soon switch their gaze back to their real obsessions, which are inflation and the Federal Reserve’s plans to counter it. If and when that switch happens, mortgage rates are likely to rise again.

Of course, I wouldn’t lock a mortgage rate on a day, such as today, when those rates look likely to fall. But, given that I think that might turn out to be a brief period, my personal rate lock recommendations overall 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 yesterday, were:

  • The yield on 10-year Treasury notes tumbled to 1.77% from 1.87%. (Very good for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields
  • Major stock indexes fell, though not as sharply as yesterday, soon after opening. (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 soared to $101.52 from $94.96 a barrel. (Bad for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity
  • Gold prices edged up to $1,924 from $1,917 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 – inched down to 22 from 23 out of 100. (Neutral 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 might fall. 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:

  1. 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
  2. Only “top–tier” borrowers (with stellar credit scores, big down payments and very healthy finances) get the ultralow mortgage rates you’ll see advertised
  3. 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
  4. When daily rate changes are small, some lenders will adjust closing costs and leave their rate cards the same
  5. 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?

Russia

So why do I think markets might soon pay less attention to Russia’s economic woes? Because, despite its military power, the country simply isn’t important enough to the global economy.

Russia is “basically a big gas station,” in the words of one Harvard economist. And it does supply a chunk of Europe’s oil and natural gas. However, with spring imminent, demand for those will fall sharply soon. In the meantime, existing reserves should tide Europe over. And it has several months to find alternative sources.

But Russia’s hardly an economic superpower at the best of times. Indeed, as economist Paul Krugman noted in The New York Times (paywall) yesterday, “Britain and France are medium–size powers; Russia’s gross domestic product is only a bit more than half as large as either’s.”

“It’s still the Fed, stupid!”

You can see why Russia grabbed markets’ attention yesterday and continues to do so today. It’s created the biggest geopolitical event in decades by invading a sovereign European nation. And the international community’s sanctions are likely to cause lasting damage to Russia’s economy.

But let me remind you of the two Financial Times headlines from Monday I quoted yesterday:

  1. Ukraine war unlikely to deflect Fed from path of interest rate rises – Officials are convinced of the need to tighten policy even as Russia’s invasion clouds the economic outlook
  2. Investors brace for flood of mortgage bonds when Fed trims balance sheet – US central bank is set to unwind massive pandemic–era stimulus measures

For American mortgage rates, those are ultimately likely to have much more impact than some economic dislocation thousands of miles away. Yes, a horrible human tragedy is causing those problems. But, while investors may be shocked personally, they focus on the numbers professionally.

And the numbers say mortgage rates are likely to move higher soon. So, if I were you, I’d hold off locking my mortgage rate to gain as much from current falls as possible. But I’d be ready to lock as soon as those rates begin to climb again.

Uncertainty

Of course, I can’t tell the future. And it’s still possible that Russia’s invasion of Ukraine could push mortgage rates lower.

The most likely scenario that could cause that is the war forcing oil prices to spike so high that it tips the global economy into recession. That could force the Fed to rethink its planned counter–inflationary measures. And mortgage rates might fall.

But if oil prices spike without causing a recession, that would fuel higher inflation. And then the Fed would likely have to come up with even more aggressive measures – pushing mortgage rates even higher.

And then there are all the usual other economic risks that could push mortgage rates lower. Imagine if a new variant of COVID–19 were to emerge that was as infectious as the Omicron variant and as deadly as Delta. Or if the stock market were to crash. Or if Russia were to drag America into a shooting war.

These and other threats are possibilities. But let’s hope they remain improbable.

For a more detailed look at what’s happening to mortgage rates, read the latest weekend edition of this report.

Recently

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. 24 report puts that weekly average for 30–year, fixed–rate mortgages at 3.89% (with 0.8 fees and points), down from the previous week’s 3.92%.

Note that Freddie expects you to buy discount points (“with 0.8 fees and points”) on closing that earn you a lower rate. If you don’t do that, your rate would have been well over 4% that week, which is closer to the rates we and others quote.

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 Feb. 18 and the MBA’s on Feb. 25. But Freddie now publishes these forecasts every quarter, most recently on Jan. 21.

Forecaster Q1/22 Q2/22 Q3/22 Q4/22
Fannie Mae 3.5% 3.6%  3.7% 3.7%
Freddie Mac 3.5% 3.6%  3.7% 3.7%
MBA 3.8% 4.0%  4.1% 4.3%

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.



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