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Posted 06/29/2017


Mortgage Rates Today, June 29, 2017, Plus Lock Recommendations

mortgage rates today

What's Driving Mortgage Interest Rates

Not much in terms of data this morning. We did get the Weekly Jobless Claims report from the Labor Department.  experts predicted 243,000 new claims for benefits, and we got 244,000 claims -- almost exactly as expected, so this won't move mortgage rates much.

However, the factors listed below are definitely spiking mortgage rates today.

Mortgage Rates Today

(As of 10:00 am EDT)

Program Rate APR* Change
Conventional 30 yr Fixed 3.750 3.750 Unchanged
Conventional 15 yr Fixed 3.125 3.125 Unchanged
Conventional 5 yr ARM 3.250 3.722 +0.04%
30 year fixed FHA 3.250 4.225 +0.01%
15 year fixed FHA 2.750 3.694 +0.02%
5 year ARM FHA 3.000 4.061 Unchanged
30 year fixed VA 3.500 3.633 Unchanged
15 year fixed VA 3.125 3.407 +0.1%
5 year ARM VA 3.375 3.398 +0.04%

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

 Today's Data

Indicators this morning point to increasing rates. Some of these indicators moved sharply, and we may see rates finally break out of the normal band they'd been occupying for the last two weeks.

  • Stock markets: all three major indexes are up (bad for rates).
  • 10-year Treasury yield: up from this time yesterday by an unbelievable seven basis points (7/100ths of one percent) to 2.29 percent (bad for rates).
  • Oil is up again to $45.20 (bad for rates).
  • Gold dropped $11 an ounce to $1,240 (bad because gold falls when the economy is hotter, and a softer economy is good for interest rates).
  • CNNMoney's Fear & Greed Index: Up ten points to 67 (bad, because investors are in a much more "greedy" mood than yesterday. Greed tends to push rates up).

This Week

This week will be a busy one as the month and quarter close out.

  • Friday: the week ends with several important statistics like personal income, consumer spending, and the core inflation rate. Those stats indicate if inflation is a concern, and they could push rates sharply (higher or lower).
  • Friday: Another highly-important report, Consumer Sentiment, shows how consumers feel about their finances, and indicates their willingness to spend. Analysts don't think it will change from its current level of 94.5. An increase would be bad for rates; a drop would be good.

Rate Lock Recommendation

Mortgage rates appear to be heading up.

I would probably lock if rates were in my strike zone and I was closing soon. However, your own goals and tolerance for risk may vary. This is only what I would do.

  • LOCK if closing in 7 days
  • LOCK if closing in 15 days
  • LOCK if closing in 30 days
  • FLOAT if closing in 45 days
  • FLOAT 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 24th, 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)