Mortgage and refinance rates today, Jun. 10, and rate forecast for next week

Today’s mortgage and refinance rates

Average mortgage rates barely budged yesterday. Indeed, over the entire week, they just moved almost imperceptibly higher.

Next week is likely to prove much more volatile. Three crucial events could send them soaring or tumbling, depending on how each goes. Given that I have no idea how they’ll turn out, I cannot predict what will happen to mortgage rates next week.

Current mortgage and refinance rates

Should you lock a mortgage rate today?

I’m still pessimistic about mortgage rates, at least for the summer. Inflation is proving too persistent and the economy too resilient to see much hope of a sustained period of lower 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

However, with so much uncertainty at the moment, your instincts could easily turn out to be as good as mine — or better. So let your gut and your own tolerance for risk help guide you.

What’s moving current mortgage rates

Next week’s economic reports

After an uneventful week, things are set to hot up for mortgage rates over the next seven days. So, buckle up!

Three events are especially likely to make those rates volatile. Two of those are monthly economic reports for May.

So, let’s start with those. The first is the consumer price index (CPI), which is due out on Tuesday.

Economists polled by MarketWatch are expecting the headline figure to show a 0.1% increase that month. And they’re predicting a 0.4% increase in core CPI, which is CPI with volatile food and energy prices stripped out.

The CPI is arguably the most important inflation report — and therefore currently the most important of all economic reports. And it is capable of moving mortgage rates sharply.

If prices are rising more quickly than expected, that’s almost bound to be bad for mortgage rates. If prices are rising more slowly than forecast, those rates might fall.

The second economic report, scheduled for Thursday, will show May’s retail sales. And they’re expected to decline by 0.1%.

If they rise or hold steady, that might push mortgage rates higher. But, if they decline, we could see falls.

Retail sales aren’t as important as inflation and employment data. But they’re an early indicator of a recession. And recessions almost always bring lower mortgage rates.

The Fed

The Federal Reserve will announce next Wednesday at 2 p.m. (ET) whether it will hike general interest rates or leave them where they are. Right now, investors are expecting a holding steady by 71.2% to 28.8%, according to the CME FedWatch tool.

However, a rise is far from out of the question. And, if the Fed unveils one on Wednesday, expect mortgage rates to jump higher. Markets have already priced in a no-change announcement, so that’s unlikely to move them far.

Wednesday’s announcement will also bring a Summary of Economic Projections, which will show how members of the Fed body that decides interest rates expect those to change in the coming months. That body is called the Federal Open Market Committee (FOMC).

Markets will be very sensitive to those projections. And they’ll also pay close attention to a news conference hosted by Fed Chair Jerome Powell 30 minutes later.

If the projections and Mr. Powell suggest higher rates for longer than previously expected, that will put upward pressure on mortgage rates. And, yes, what they say might be influenced by the previous day’s CPI.

Economic reports next week

I covered next week’s most crucial economic events in the previous section.

And they’re in bold in the following list. Others probably won’t have much impact on mortgage rates unless they contain shockingly good or bad data.

• Tuesday — May CPI. Plus the small business optimism index from the National Federation of Independent Business
• Wednesday — Fed rate announcement and news conference. Plus May producer price index
• Thursday — May retail sales. And May import price index, industrial production, and capacity utilization. Plus initial jobless claims for the week ending Jun. 10
• Friday — June consumer sentiment

It’s a packed midweek with plenty of scope for volatile mortgage rates.

Time to make a move? Let us find the right mortgage for you

Mortgage interest rates forecast for next week

There’s too much unpredictable activity next week for me to make even a stab at forecasting what might happen to mortgage rates over the next seven days. Sorry!

How your mortgage interest rate is determined

Mortgage and refinance rates are generally determined by prices in a secondary market (similar to the stock or bond markets) where mortgage-backed securities are traded.

And that’s highly dependent on the economy. So mortgage rates tend to be high when things are going well and low when the economy’s in trouble. But inflation rates can undermine those tendencies.

Your part

But you play a big part in determining your own mortgage rate in five ways. And you can affect it significantly by:

1. Shopping around for your best mortgage rate — They vary widely from lender to lender
2. Boosting your credit score — Even a small bump can make a big difference to your rate and payments
3. Saving the biggest down payment you can — Lenders like you to have real skin in this game
4. Keeping your other borrowing modest — The lower your other monthly commitments, the bigger the mortgage you can afford
5. Choosing your mortgage carefully — Are you better off with a conventional, conforming, FHA, VA, USDA, jumbo or another loan?

Time spent getting these ducks in a row can see you winning lower rates.

Remember, they’re not just a mortgage rate

Be sure to count all your forthcoming homeownership costs when you’re working out how big a mortgage you can afford. So, focus on your “PITI.” That’s your Principal (pays down the amount you borrowed), Interest (the price of borrowing), (property) Taxes, and (homeowners) Insurance. Our mortgage calculator can help with these.

Depending on your type of mortgage and the size of your down payment, you may have to pay mortgage insurance, too. And that can easily run into three figures every month.

But there are other potential costs. So, you’ll have to pay homeowners association dues if you choose to live somewhere with an HOA. And, wherever you live, you should expect repairs and maintenance costs. There’s no landlord to call when things go wrong!

Finally, you’ll find it hard to forget closing costs. You can see those reflected in the annual percentage rate (APR) that lenders will quote you. Because that effectively spreads them out over your loan’s term, making that rate higher than your straight mortgage rate.

But you may be able to get help with those closing costs and your down payment, especially if you’re a first-time buyer. Read:

Down payment assistance programs in every state for 2023

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 result is a good snapshot of daily rates and how they change over time.