Click To See Today's Rates

Posted 05/18/2017

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Mortgage Rates Today, May 18, 2017, Plus Lock Recommendations

mortgage rates today

What's Driving Mortgage Rates Today?

Today's only news is the weekly unemployment report. The Labor Department reported that 232,000 new claims for unemployment benefits were filed last week. That's 8,000 fewer than expected, which means the employment market may be better than previously thought.

This is not good for mortgage rates, but because this is only a weekly report, it's not considered terribly important. To get a better idea of where mortgage rates might be headed, you'll want to consider the additional data posted under the rates section.

Click to see today's rates (Sep 23rd, 2017)

 Mortgage Rates Today

Program Rate APR* Change
Conventional 30 yr Fixed 3.750 3.750 -0.13%
Conventional 15 yr Fixed 3.125 3.125 Unchanged
Conventional 5 yr ARM 3.000 3.661 -0.04%
30 year fixed FHA 3.250 4.206 -0.03%
15 year fixed FHA 2.750 3.632 -0.02%
5 year ARM FHA 2.875 3.982 -0.04%
30 year fixed VA 3.375 3.512 -0.12%
15 year fixed VA 2.875 3.181 Unchanged
5 year ARM VA 3.250 3.300 -0.01%

Your rate might be different. Click here for a personalized rate quote. See our rate assumptions here.

 Today's Data

  • All three stock markets: slightly up (slightly bad for rates)
  • 10-year Treasury yield: nearly unchanged at 2.22 percent (neutral)
  • Oil is up, still below $50: (slightly bad)
  • Gold slightly down (slightly bad for rates)
  • Fear & Greed: 44 (excellent; investors are very nervous according to this metric).

Tomorrow

There are no major economic reports due tomorrow.

Rate Lock Recommendation

I expect mortgage rates to fall today and would lock if I had a loan in the works. Your own risk tolerance and goals may vary.

  • 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

What Causes Rates To Rise And Fall?

Mortgage interest rates depend on a great deal on the expectations of investors. Good economic news tends to be bad for interest rates, because an active economy raises concerns about inflation. Inflation causes fixed-income investments like bonds to lose value, and that causes their yields (another way of saying interest rates) to increase.

For example, suppose that two years ago, you bought a $1,000 bond paying five percent interest ($50) each year. (This is called its “coupon rate.") That’s a pretty good rate today, so lots of investors want to buy it from you. You sell your $1,000 bond for $1,200.

When Rates Fall

The buyer gets the same $50 a year in interest that you were getting. However, because he paid more for the bond, his interest rate is not five percent.

  • Your interest rate: $50 annual interest / $1,000 = 5.0%
  • Your buyer’s interest rate: $50 annual interest / $1,200 = 4.2%

The buyer gets an interest rate, or yield, of only 4.2 percent. And that’s why, when demand for bonds increases and bond prices go up, interest rates go down.

When Rates Rise

However, when the economy heats up, the potential for inflation makes bonds less appealing. With fewer people wanting to buy bonds, their prices decrease, and then interest rates go up.

Imagine that you have your $1,000 bond, but you can't sell it for $1,000, because unemployment has dropped and stock prices are soaring. You end up getting $700. The buyer gets the same $50 a year in interest, but the yield looks like this:

  • $50 annual interest / $700 = 7.1% The buyer’s interest rate is now slightly more than seven percent.

Click to see today's rates (Sep 23rd, 2017)

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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2017 Conforming, FHA, & VA Loan Limits

Mortgage loan limits for every U.S. county, as published by Fannie Mae & Freddie Mac, the Federal Housing Administration (FHA), and the Department of Veterans Affairs (VA)