Today’s mortgage and refinance rates
Average mortgage rates inched higher yesterday. But only by the smallest measurable amount. And conventional loans today start at 3.125% (3.125% APR) for a 30-year, fixed-rate mortgage.
Some of yesterday’s rise may have been down to that day’s gross domestic product (GDP) figure, which was good. But it was also down to that day’s spectacular earnings releases from big tech companies. And they won’t be repeated. Still, rates today look set to probably nudge higher, though that’s far from certain.Find and lock a low rate (Dec 3rd, 2020)
Current mortgage and refinance rates
|Conventional 30 year fixed|
|Conventional 30 year fixed||3.125%||3.125%||Unchanged|
|Conventional 15 year fixed|
|Conventional 15 year fixed||3.063%||3.063%||Unchanged|
|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%||Unchanged|
|30 year fixed VA|
|30 year fixed VA||3.063%||3.242%||Unchanged|
|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%||Unchanged|
|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?
For the reasons in “Are mortgage and refinance rates rising or falling?” (below), I stand by my opinion that mortgage rates are likely to carry on inching lower, though only slowly and unsteadily. And that those falls will be punctuated by occasional, brief and modest rises — such as yesterday’s and maybe today’s.
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 rose to 0.84% from 0.78%. (Bad 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 modestly lower on 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 happens when indexes are lower
- Oil prices edged up to $35.77 from $35.01 a barrel. (Bad for mortgage rates* because energy prices play a large role in creating inflation and also point to future economic activity.)
- Gold prices rose to $1,888 from $1,865 an ounce. (Good 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.
*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 worse 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?
Yesterday’s GDP announcement for the third quarter was at the top end of the range of forecasts. And it was undeniably good news: a record rate of growth.
But it followed a record fall. And the economy is still only two-thirds of the way back to its pre-pandemic level.
Worse, there are signs its recovery is stalling as COVID-19 surges. Yesterday saw a record number of new cases reported in the US in one day (86,600) and the total this year has passed 9 million.
Meanwhile, another threat to investors looms. Yesterday, in The Guardian, Nouriel Roubini, who is professor of economics at New York University’s Stern School of Business, warned that markets could drop 10% if Election Day threw up “a long-contested result, with both sides refusing to concede as they wage ugly legal and political battles in the courts, through the media, and on the streets.”
So, as we’ve been suggesting recently, there seem to be very few glimmers of light for markets in what’s generally a relentlessly gloomy picture.
And that’s good for those who want lower mortgage rates. But what a shame that it’s so damaging for everyone else.
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. Yesterday’s report said rates remained “relatively flat” that week.
But not every mortgage expert agrees with Freddie’s figures. In particular, they relate to purchase mortgages alone and ignore refinances. And if you average out across both, rates have been consistently higher than the all-time low since that August record.
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.