Today’s mortgage and refinance rates
Average mortgage rates rose appreciably yesterday. And, in a single leap, those rates are back to their two-year high. But don’t forget: Those last two years have seen the lowest rates in history. So today’s are still exceptionally low by earlier standards.
Unfortunately, there may be more bad news. Following this morning’s exceptionally good employment figures, mortgage rates today look likely to rise, perhaps appreciably.
Current mortgage and refinance rates
|Conventional 30 year fixed|
|Conventional 30 year fixed||3.857%||3.878%||+0.04%|
|Conventional 15 year fixed|
|Conventional 15 year fixed||3.188%||3.223%||+0.01%|
|Conventional 20 year fixed|
|Conventional 20 year fixed||3.531%||3.563%||+0.07%|
|Conventional 10 year fixed|
|Conventional 10 year fixed||3.108%||3.173%||+0.02%|
|30 year fixed FHA|
|30 year fixed FHA||3.966%||4.745%||+0.06%|
|15 year fixed FHA|
|15 year fixed FHA||3.184%||3.819%||+0.04%|
|5/1 ARM FHA|
|5/1 ARM FHA||4.75%||4.54%||+0.35%|
|30 year fixed VA|
|30 year fixed VA||3.972%||4.177%||+0.03%|
|15 year fixed VA|
|15 year fixed VA||3.322%||3.653%||-0.08%|
|5/1 ARM VA|
|5/1 ARM VA||3.761%||3.304%||+0.04%|
|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.|
Should you lock a mortgage rate today?
Following the publication this morning of the official employment situation report, we look set to be staring yet higher mortgage rates in the eye.
Of course, there may be some falls ahead. But I doubt that they’ll make up for 2022’s rises.
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
>Related: 7 Tips to get the best refinance rate
Market data affecting today’s mortgage rates
Here’s a snapshot of the state of play this morning at about 10:00 a.m. (ET). The data, compared with roughly 10:25 a.m. yesterday, were:
- The yield on 10-year Treasury notes soared to 1.91% from 1.83%. (Very bad for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields
- Major stock indexes were mostly higher. (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 may happen when indexes are lower. But this is an imperfect relationship
- Oil prices climbed to $92.70 from $87.94 a barrel. (Bad for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity
- Gold prices inched up to $1,803 from $1,801 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 index — edged down to 33 from 35 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. 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, mortgage rates today might rise by a noticeable amount. However, be aware that “intraday swings” (when rates change direction during the day) are a common feature right now.
Important notes on today’s mortgage rates
Here are some things you need to know:
- 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 daily rate movements — though they all usually follow the wider trend over time
- When daily 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.
A lot is going on at the moment. 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?
This morning’s employment situation report delivered much better news than anyone expected. Economists polled by the Wall Street Journal thought +150,000 jobs would probably have been created in January.
But, before the report’s release, the Journal reported on “whisper” numbers that tried to estimate the impact of the Omicron variant on jobs: “Goldman Sachs forecasts a decline of 250,000 jobs, Morgan Stanley -215,000, TD Securities -200,000.”
Yeah, right. The actual number of new jobs added in January was 467,000. It’s hard to overstate just how good (and unexpected) that number is. Though not for mortgage rates.
Because today’s employment situation report delivers a double whammy to mortgage rates. Such good news would suggest a booming economy, which itself tends to push those rates higher.
But there’s something potentially worse. The Fed is tasked with balancing a low inflation rate (a target of about 2% p.a.) with acceptable levels of employment. Now that employment is looking so strong, that gives permission for the Fed to act even more aggressively to drive down inflation from its January level of 7%.
And some are already predicting that March’s Fed rate rise might be 0.5% instead of 0.25%. That prospect might have a bigger effect on mortgage rates than just the raw employment numbers.
Why did mortgage rates rise so far yesterday? That morning, CNBC said bond investors were focused on today’s all-important, official, employment situation report.
But there may have been other drivers. For example, yesterday saw Europe’s two most important central banks (the equivalents of our Federal Reserve) reveal a hawkish approach to inflation.
The Bank of England hiked its key interest rate to 0.5%. That was the second rise in a row. And it must have reminded investors that the Fed hasn’t closed the door on implementing rate rises at each of its six-weekly meetings from March until the end of this year.
Meanwhile, the European Central Bank (ECB) left its rates where they were. But signaled that it would be willing to hike them soon, if necessary. “The situation has indeed changed … Inflation is likely to remain elevated for longer than expected,” said ECB President Christine Lagarde, changing its stated keep-rates-steady policy of just seven weeks earlier.
And it’s not just European central bankers. The Wall Street Journal (paywall) yesterday reported that several other central banks have recently taken a tougher stance on inflation, including those of Australia, Brazil and Canada.
Of course, the Fed doesn’t have to follow its peers around the world. It’s by far the most powerful central bank.
But we already know how determined it is to tackle inflation. And the actions of other central banks make it easier for it to justify more aggressive policies here.
It would be no surprise if yesterday’s reminder of the potency of the Fed’s plans helped mortgage rates higher that day.
For a more detailed look at what’s happening to mortgage rates, read the latest weekend edition of this report.
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 that year, according to Freddie Mac.
The most recent weekly record low occurred on Jan. 7, 2021, when it stood at 2.65% for 30-year fixed-rate mortgages.
Since then, the picture has been mixed with extended periods of rises and falls. Unfortunately, since last September, the rises have grown more pronounced, though not consistently so.
Freddie’s Feb. 3 report puts that weekly average for 30-year, fixed-rate mortgages at 3.55% (with 0.8 fees and points), unchanged from the previous week.
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 four quarters of 2022 (Q1/22, Q2/22, Q3/22, Q4/22).
The numbers in the table below are for 30-year, fixed-rate mortgages. Fannie’s were published on Jan. 19 and Freddie’s and the MBA’s on Jan. 21.
Personally, I was surprised that Fannie Mae only slightly increased its rate forecasts in January. It believes that rates for 30-year, fixed-rate mortgages will average 3.2% over the current quarter. But, on the day its figures were published, we reported those for conventional loans were already up to 3.87%.
Do Fannie’s economists expect those rates to plummet later this month or in February or March and remain lower in the following quarters? If so, they know something that I don’t. And that their peers in Freddie and the MBA’s teams don’t, either, though I’m less optimistic than any of them.
Of course, given so many unknowables, the whole current crop of forecasts may be even more speculative than usual.
Find your lowest rate today
You should comparison shop 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.”
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.