Mortgage and refinance rates today, Sept. 28, 2021

Peter Warden
The Mortgage Reports editor

Today’s mortgage and refinance rates 

Average mortgage rates rose yet again yesterday. But only by the smallest measurable amount.

Hopes that yesterday’s tiny fall represented an end to recent rises were dashed this morning. Because mortgage rates today look likely to rise again, possibly quite sharply.

Find and lock a low rate (Dec 5th, 2021)

Current mortgage and refinance rates 

Program Mortgage Rate APR* Change
Conventional 30 year fixed
Conventional 30 year fixed 3.165% 3.182% +0.05%
Conventional 15 year fixed
Conventional 15 year fixed 2.511% 2.535% +0.04%
Conventional 20 year fixed
Conventional 20 year fixed 3.015% 3.051% +0.03%
Conventional 10 year fixed
Conventional 10 year fixed 2.491% 2.541% +0.08%
30 year fixed FHA
30 year fixed FHA 3.157% 3.917% +0.05%
15 year fixed FHA
15 year fixed FHA 2.537% 3.18% +0.01%
5/1 ARM FHA
5/1 ARM FHA 2.43% 3.079% +0.01%
30 year fixed VA
30 year fixed VA 2.976% 3.168% +0.05%
15 year fixed VA
15 year fixed VA 2.711% 3.06% +0.01%
5/1 ARM VA
5/1 ARM VA 2.515% 2.311% 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 5th, 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?

Yes! I’d certainly lock my mortgage rate if I were you. Of, course, it’s always possible that they’ll fall back by a worthwhile amount. And some periods of small falls are inevitable.

But, to my mind, the chances of further — probably sustained — rises are higher now than at any time in many months.

So my personal rate lock recommendations remain:

  • 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

However, I don’t claim perfect foresight. And your personal analysis could turn out to be as good as mine — or better. So you might choose to be guided by your instincts 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 Treasury notes climbed to 1.56% from 1.48%. (Bad for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields
  • Major stock indexes were lower soon after 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 may happen when indexes are lower
  • Oil prices increased to $76.19 from $75.55 a barrel. (Bad for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity. 
  • Gold prices fell to $1,735 from $1,752 an ounce. (Neutral for mortgage rates*.) In general, it is 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 indexinched higher to 35 from 34 out of 100. (Bad 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. We still make daily calls. And are usually right. But our record for accuracy won’t achieve its former high levels until things settle down.

So use markets only as a rough guide. Because they have to be exceptionally strong or weak to rely on them. But, with that caveat, so far mortgage rates today look likely to rise. But be aware that “intraday swings” (when rates change direction during the day) are a common feature right now.

Find and lock a low rate (Dec 5th, 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 ultralow 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 daily 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. And a recent regulatory change has narrowed a gap that previously existed

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

Mortgage rates tend to shadow the yield on 10-year Treasury notes. It’s not a perfect relationship. But it’s one that is undeniably close.

That’s partly because both that yield and that rate are largely determined by the trading of different sorts of bonds: US Treasury notes and mortgage-backed securities. And these two compete closely in similar spaces for similar buyers and sellers.

Last Friday, one analyst, Simpler Trading’s director of options Danielle Shay, told CNBC she thought 10-year Treasury yields could soon top 1.7%. They closed at 1.32% a week ago today. And they were already up at 1.56% by 10 a.m. (ET) this morning. Assuming mortgage rates follow a similar trajectory, they could continue to rise sharply.

Indeed, those mortgage rates were at 3% one week ago, according to Mortgage News Daily’s archive. And a rise equivalent to the one Ms Shay is forecasting for that Treasury yield would put them at 3.84% fairly soon.

Drivers of these changes

Yesterday, I listed the three main drivers for higher mortgage rates. And two have gotten worse for those rates over the last 24 hours:

  1. Federal Reserve tapering — Nothing’s changed since yesterday. And most still expect an announcement on Nov. 3. Tapering will see the Fed wind down its program that’s been keeping mortgage rates artificially low for the last 18 months
  2. The Senate yesterday rejected legislation to raise the debt ceiling, with opponents vowing to continue their resistance. If the current debt ceiling remains, the US could default on its debts within weeks. And that would very likely make all forms of borrowing (including mortgages) more expensive
  3. Reported new cases of COVID-19 were down a whopping 33% over the 14 days ending on Sept. 27, according to The New York Times. That’s great for public health but investors’ fears of the impact on the economy of the pandemic have been another factor keeping mortgage rates low. And those fears are currently evaporating

True, we can’t be certain that something truly awful will not come along that overwhelms all those and pushes these rates lower. But it’s relatively unlikely.

For more details of what’s going on, read last Saturday’s weekend edition of this daily report.

Recently

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

The most recent weekly record low occurred on Jan. 7, when it stood at 2.65% for 30-year fixed-rate mortgages. But then the trend reversed and rates rose moderately.

However, in April and after, those rises were mostly replaced by falls, though typically small ones. Freddie’s Sept. 23 report puts that weekly average at 2.88% (with 0.7 fees and points), up from the previous week’s 2.86%. But that doesn’t reflect the sharp rise seen on the day of publication. Expect a 3%+ rate tomorrow.

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 rate forecasts for the remaining quarters of 2021 (Q3/21 and Q4/21) and the first two quarters of 2022 (Q1/22 and Q2/22).

The numbers in the table below are for 30-year, fixed-rate mortgages. Fannie’s were updated on Sept. 20 and the MBA’s on Sept. 22. But Freddie’s were last refreshed on July 15 because it now publishes these figures only quarterly. And its forecast is looking seriously stale.

Forecaster Q3/21 Q4/21 Q1/22 Q2/22
Fannie Mae 2.9% 2.9%  3.0% 3.1%
Freddie Mac 3.3% 3.4%  3.5% 3.6%
MBA 2.8% 3.1%  3.4% 3.6%

However, given so many unknowables, the whole current crop of forecasts may be even more speculative than usual.

All these forecasts expect higher mortgage rates soon or soon-ish. But the differences between the forecasters are stark. And it may be that Fannie isn’t building in the Federal Reserve’s tapering of its support for mortgage rates while Freddie and the MBA are. Or perhaps Fannie believes tapering will have little impact.

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 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 (Dec 5th, 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.