Mortgage and refinance rates today, November 12, 2020

Peter Warden
The Mortgage Reports editor

Today’s mortgage and refinance rates 

Average mortgage rates remained unchanged yesterday. And conventional loans started out this morning at 2.75% (2.75% APR) for a 30-year, fixed-rate mortgage. 

Yesterday’s unchanged mortgage rates were no surprise because a key market was closed. So any differences would have been down to lenders adjusting their own rates. First thing this morning, things were looking quietly good for rates.

Find and lock a low rate (Dec 3rd, 2020)

Current mortgage and refinance rates 

Program Mortgage Rate APR* Change
Conventional 30 year fixed
Conventional 30 year fixed 2.75% 2.75% Unchanged
Conventional 15 year fixed
Conventional 15 year fixed 2.5% 2.5% Unchanged
Conventional 5 year ARM
Conventional 5 year ARM 3% 2.743% Unchanged
30 year fixed FHA
30 year fixed FHA 3% 3.982% 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% 3.179% 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.
Find and lock a low rate (Dec 3rd, 2020)

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?

We might see a modest fall in mortgage rates today. And more could be in prospect.

So I wouldn’t lock today unless I were close to closing. But the possibility of good economic news that pushes them higher never goes away. See “Are mortgage and refinance rates rising or falling?” (below) for more.

Still, I’m resetting my personal rate lock recommendations to where they were last week:

  • 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 fell to 0.92% from 0.96%. (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 mostly 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 fell to $41.80 from $42.62 a barrel. (Good 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 $1,875 from $1,863 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 — Fell back to 62 from 65 out of 100. (Good 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.

Caveats about markets and 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. But, with that caveat, they’re looking OK for mortgage rates today.

Find and lock a low rate (Dec 3rd, 2020)

Important notes on today’s mortgage rates

Here are some things you need to know:

  1. 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
  2. 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
  3. Only “top-tier” borrowers (with stellar credit scores, big down payments and very healthy finances) get the ultralow mortgage rates you’ll see advertised
  4. Lenders vary. Yours may or may not follow the crowd when it comes to daily rate movements — though they all usually follow the wider trend over time
  5. When rate changes are small, some lenders will adjust closing costs and leave their rate cards the same
  6. 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?

Today

Yesterday, I hoped that “We may be seeing the start of a return to the slow downward trend in mortgage rates that we’ve been witnessing for months.”

And markets up until 9:50 a.m. (ET) this morning suggest I may have been right — at least, for now. Most of the current outlook appears gloomy (so good for mortgage rates) and investors have already priced in the likely bright spots.

In particular, markets have to take greater account of the economic impact of the COVID-19 pandemic. The number of new cases in the US continues to surge, with grim records being broken on most days.

Meanwhile, Gov. Andrew M. Cuomo yesterday imposed new pandemic restrictions on New York state, further limiting personal and business activities. If other governors — or the federal government under a new administration — are forced to follow suit, that could seriously impact our national gross domestic product.

Yes, the Pfizer vaccine might stem the rate of increase in new cases and ultimately reverse it. But that assumes the vaccine passes its remaining trials and proves equally safe and effective in widespread use. And, even then, it might easily be within the second half of 2021 or beyond that the country acquires some form of herd immunity. Surely markets can’t just shrug that off.

But stock markets, in particular, are notorious for ignoring things they don’t want to see. So there are no guarantees that mortgage rates will fall. And, even if they do, periods of rises are inevitable, though, we hope, brief.

This morning’s weekly figures for unemployment claims were a little better than expected. But they weren’t good enough to move markets. And, absent further momentous news, it would be no surprise if mortgage rates edge modestly lower today.

Recently

Over the last few months, the overall trend for mortgage rates has clearly been downward. A new all-time low was set during each of the weeks ending Oct. 15 and 22 and Nov. 5, according to Freddie Mac. But today’s report showed higher mortgage rates this week.

However, note that Freddie’s figures 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 a record set in August. The gap between the two has been widened by a controversial regulatory change.

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).

But note that Fannie’s (out on Oct. 19) and the MBA’s (Oct. 21) are updated monthly. However, Freddie’s are now published quarterly. And its latest was released on Oct. 14.

The numbers in the table below are for 30-year, fixed-rate mortgages:

ForecasterQ4/20Q1/21Q2/21Q3/21
Fannie Mae2.9%2.8%2.8%2.8%
Freddie Mac3.0%3.0%3.0%3.0%
MBA3.0%3.1%3.1%3.2%

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:

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.

Verify your new rate (Dec 3rd, 2020)

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.