Mortgage and refinance rates today, March 5, 2021

Peter Warden
The Mortgage Reports editor

Today’s mortgage and refinance rates 

Average mortgage rates rose appreciably yesterday. They’re not back up to the recent highs seen at the end of last week. But it was enough to wipe out Tuesday’s welcome fall.

Unfortunately, it looks as if mortgage rates today might continue to move higher. However, markets are currently jittery — and therefore unpredictable. Read on to discover what’s going on.

Find and lock a low rate (Apr 16th, 2021)

Current mortgage and refinance rates 

Program Mortgage Rate APR* Change
Conventional 30 year fixed
Conventional 30 year fixed 3.034% 3.039% +0.03%
Conventional 15 year fixed
Conventional 15 year fixed 2.281% 2.399% -0.09%
Conventional 20 year fixed
Conventional 20 year fixed 2.813% 2.904% -0.06%
Conventional 10 year fixed
Conventional 10 year fixed 1.842% 2.062% -0.02%
30 year fixed FHA
30 year fixed FHA 2.773% 3.43% +0.02%
15 year fixed FHA
15 year fixed FHA 2.591% 3.177% -0.03%
5 year ARM FHA
5 year ARM FHA 2.5% 3.201% Unchanged
30 year fixed VA
30 year fixed VA 2.375% 2.547% Unchanged
15 year fixed VA
15 year fixed VA 2.25% 2.571% Unchanged
5 year ARM VA
5 year ARM VA 2.5% 2.379% 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 (Apr 16th, 2021)

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?

I’d lock my rate if I were you. February was a bad month for mortgage rates. And, after a more promising start, March doesn’t seem to be shaping up much better.

Of course, there’s always a chance of something momentous suddenly changing everything. But, right now, that looks to be a slim one.

So my personal rate lock recommendations stand:

  • 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

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 a snapshot of the state of play this morning at about 9:50 a.m. (ET). The data, compared with roughly the same time yesterday, were:

  • The yield on 10-year Treasurys jumped to 1.60% from 1.47%. (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 higher on opening. (Bad 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 rose to $65.78 from $62.25 a barrel. (Bad for mortgage rates*) Energy prices play a large role in creating inflation and also point to future economic activity
  • Gold prices nudged down to $1,695 from $1,712 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 to 48 from 52 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. Because they have to be exceptionally strong (meaning rates are likely to rise) or weak (meaning they could fall) to be a reliable indicator.

But, with that caveat, so far mortgage rates today look likely to rise again. Just be aware that intraday swings (when rates change direction during the day) are common right now.

Find and lock a low rate (Apr 16th, 2021)

Important notes on today’s mortgage rates

Here are some things you need to know:

  1. 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
  2. Only “top-tier” borrowers (with stellar credit scores, big down payments and very healthy finances) get the ultra-low mortgage rates you’ll see advertised
  3. 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
  4. When rate changes are small, some lenders will adjust closing costs and leave their rate cards the same
  5. Refinance rates are typically close to those for purchases. But some types of refinances are 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 and soon

Yesterday’s surprisingly large rise was in response to remarks made that day by Federal Reserve Chair Jerome H. Powell at The Wall Street Journal Jobs Summit.

Investors had hoped Powell would reassure them he planned to keep inflation (and bond yields) under control if the economy overheats as it recovers from the pandemic. And he did. But not in the way they most wanted.

Some hoped he would promise to implement Operation Twist, a strategy the Fed used when inflation was last a problem, back in the 1960s and ’70s. That involved the central bank selling its short-term bonds and buying long-term ones, thus taking on much of the risk from the private sector.

Chances are, the Fed will do that again if it proves necessary. But Powell wasn’t ready to promise that yet, because it could choke off the recovery. His promise that “we’re not going to allow [runaway inflation] to happen again” wasn’t enough to stop investors from throwing a tantrum.

And the uncertainty created by Powell’s remarks yesterday seems to be continuing today. This morning’s better-than-expected employment figures aren’t helping those who want lower rates.

For more background on my wider thinking, read our latest weekend edition, which is published every Saturday soon after 10 a.m. (ET).

Recently

Over much of 2020, the overall trend for mortgage rates was clearly downward. New, weekly all-time lows were set on 16 occasions last year, according to Freddie Mac.

The most recent weekly record low occurred on January 7, 2021, when it stood at 2.65% for 30-year fixed-rate mortgages.

But rates then rose. And Freddie’s March 4 report puts that weekly average at 3.02% (with 0.6 fees and points), up from the previous week’s 2.97%.

Expert mortgage rate forecasts

Looking further ahead, Fannie Mae, Freddie Mac, and the Mortgage Bankers Association (MBA) each have a team of economists dedicated to monitoring and forecasting what will happen to the economy, the housing sector, and mortgage rates.

Here are their current rates forecasts for each quarter of 2021 (Q1/21, Q2/21, Q3/21, and Q4/21).

The numbers in the table below are for 30-year, fixed-rate mortgages. Fannie’s and the MBA’s were updated on Feb. 18 and 19 respectively. But Freddie now publishes forecasts quarterly and its figures are from mid-January:

Forecaster Q1/21 Q2/21 Q3/21 Q4/21
Fannie Mae 2.8% 2.8% 2.9% 2.9%
Freddie Mac 2.9% 2.9% 3.0% 3.0%
MBA 2.8% 3.1% 3.3% 3.4%

However, given so many unknowables, the current crop of forecasts may be even more speculative than usual. And there’s certainly a widening spread as the year progresses.

Find your lowest rate today

Some lenders have been spooked by the pandemic. And they’re restricting their offerings to just the most vanilla-flavored mortgages and refinances.

But others remain brave. And you can still probably find the cash-out refinance, investment property mortgage, or jumbo loan you want. You just have to shop around more widely.

But, of course, you should be comparison shopping widely no matter what sort of mortgage you want. 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 (Apr 16th, 2021)

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.