Today’s mortgage and refinance rates
Average mortgage rates nudged modestly lower yesterday. And conventional loans today start at 2.75% (2.75% APR) for a 30-year, fixed-rate mortgage.
We warned not to expect a dramatic fall in these rates, even though the Dow dove 650 points yesterday. Judging from the situation in markets this morning, things may be fairly quiet for rates again today.Find and lock a low rate (Dec 3rd, 2020)
Current mortgage and refinance rates
|Conventional 30 year fixed|
|Conventional 30 year fixed||2.75%||2.75%||-0.44%|
|Conventional 15 year fixed|
|Conventional 15 year fixed||3.063%||3.063%||-0.06%|
|Conventional 5 year ARM|
|Conventional 5 year ARM||3%||2.743%||Unchanged|
|30 year fixed FHA|
|30 year fixed FHA||2.25%||3.226%||Unchanged|
|15 year fixed FHA|
|15 year fixed FHA||2.25%||3.191%||Unchanged|
|5 year ARM FHA|
|5 year ARM FHA||2.5%||3.239%||-0.01%|
|30 year fixed VA|
|30 year fixed VA||3.063%||3.242%||-0.06%|
|15 year fixed VA|
|15 year fixed VA||2.25%||2.571%||Unchanged|
|5 year ARM VA|
|5 year ARM VA||2.5%||2.419%||-0.01%|
|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.|
COVID-19 mortgage updates: Mortgage lenders are changing rates and rules due to COVID-19. To see the latest on how coronavirus could impact your home loan, click here.
Should you lock a mortgage rate today?
The same three issues loom over markets this morning as did yesterday:
- Spiking COVID-19 infection rates in much of the US continue to threaten the recovery. New cases reported yesterday totaled 74,323
- Hopes for an economic stimulus package before the election have all but died
- Election Day is one week off — Wall Street has already priced in a Biden win, so that’s not an issue. But fear of the uncertainty a disputed result would bring is real
The same issues may remain. But there are just enough decent economic reports around to give investors the excuse they need to arrest yesterday’s slide. And the fact those reports relate to periods when these issues were less scary seems not to bother many investors, at least for now.
So sharply lower mortgage rates appear unlikely, though they may edge down some. Still, absent some shocking news event, noticeably higher rates seem an even more distant possibility.
So my personal recommendations remain:
- LOCK if closing in 7 days
- LOCK if closing in 15 days
- FLOAT if closing in 30 days
- FLOAT if closing in 45 days
- FLOAT if closing in 60 days
But, with so much uncertainty at the moment, your instincts could easily turn out to be as good as mine — or better. So be guided by your gut and your personal tolerance for risk.
Market data affecting today’s mortgage rates
Here’s the state of play this morning at about 9:50 a.m. (ET). The data, compared with about the same time yesterday morning, were:
- The yield on 10-year Treasurys edged lower to 0.79% from 0.81%. (Good for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields, though less so recently
- Major stock indexes were barely moving and mixed on opening. (Neutral 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 happens when indexes are lower
- Oil prices inched up to $38.87 from $38.82 a barrel. (Neutral for mortgage rates* because energy prices play a large role in creating inflation and also point to future economic activity.)
- Gold prices edged up to $1,907 from $1,905 an ounce. (Neutral for mortgage rates*.) In general, it’s 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 — We continue to have access issues. See if you have more luck. (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.
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. The Fed is now a huge player and some days can overwhelm investor sentiment.
So use markets only as a rough guide. They have to be exceptionally strong (rates are likely to rise) or weak (they could fall) to rely on them. Today, they’re looking OK for mortgage rates.
Important notes on today’s mortgage rates
Here are some things you need to know:
- The Fed’s ongoing interventions in the mortgage market (way over $1 trillion) should put continuing downward pressure on these rates. But it can’t work miracles all the time. So expect short-term rises as well as falls. And read “For once, the Fed DOES affect mortgage rates. Here’s why” if you want to understand this aspect of what’s happening
- 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 rate movements — though they all usually follow the wider trend over time
- When 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. But some types of refinances from Fannie Mae and Freddie Mac are currently appreciably higher following a regulatory change
So there’s a lot going on here. 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?
Over the last few months, the overall trend for mortgage rates has clearly been downward. A new all-time low was set early in August and we’ve gotten close to others since. Indeed, Freddie Mac said that a new low was set during each of the weeks ending Oct. 15 and 22.
But not every mortgage expert agrees with Freddie’s figures. In particular, Freddie’s relate to purchase mortgages rather than refinances. And if you average out across both, rates are higher than the all-time low.
But, in any event, certainty is in very short supply at the moment. So don’t assume anything.
It all depends on countless variables, most of which are unknowable.
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 rates forecasts for the last quarter of 2020 (Q4/20) and the first three of 2021 (Q1/21, Q2/21 and Q3/21).
Note that Fannie’s (out on Oct. 19) and the MBA’s (Oct. 21) are updated monthly. However, Freddie’s are now published quarterly. Its latest was released on Oct. 14.
The numbers in the table below are for 30-year, fixed-rate mortgages:
So predictions vary considerably. You pays yer money …
Find your lowest rate today
The pandemic — together with a surge in home sales and mortgage and refinance applications — has created some turmoil in the home loans industry.
And that’s making it harder for some borrowers to find the sorts of mortgages they need. So be prepared to shop around even more widely than usual.
But, of course, comparison shopping for a loan is always important. As federal regulator the Consumer Financial Protection Bureau says:
Verify your new rate (Dec 3rd, 2020)
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.