Today’s mortgage and refinance rates
Average mortgage rates moved lower again yesterday. It wasn’t a big fall by recent standards, but it was a worthwhile one. If your lender didn’t drop your rate yesterday, it might well this morning.
Mortgage rates today look likely to fall again. And, if that trend continues as the hours pass, those for conventional, 30-year, fixed-rate mortgages should end the day back below 6%.
Current mortgage and refinance rates
|Conventional 30 year fixed|
|Conventional 30 year fixed||6.173%||6.205%||+0.13%|
|Conventional 15 year fixed|
|Conventional 15 year fixed||5.266%||5.3%||-0.24%|
|Conventional 20 year fixed|
|Conventional 20 year fixed||6.197%||6.259%||+0.07%|
|Conventional 10 year fixed|
|Conventional 10 year fixed||5.687%||5.797%||-0.03%|
|30 year fixed FHA|
|30 year fixed FHA||6.019%||6.89%||+0.26%|
|15 year fixed FHA|
|15 year fixed FHA||5.563%||6.17%||-0.09%|
|30 year fixed VA|
|30 year fixed VA||5.778%||6.007%||+0.09%|
|15 year fixed VA|
|15 year fixed VA||5.697%||6.05%||-0.15%|
|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?
Don't lock on a day when mortgage rates look set to fall. My recommendations (below) are intended to give longer-term suggestions about the overall direction of those rates. So, they don’t change daily to reflect fleeting sentiments in volatile markets.
Unfortunately, a couple of days of better news about mortgage rates isn’t enough to persuade me they’re likely to fall significantly for a sustained period over the next few 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
>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 9:50 a.m. (ET). The data, compared with roughly the same time yesterday, were:
- The yield on 10-year Treasury notes rose to 3.30% from 3.25%. (Bad for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields
- Major stock indexes were higher soon after 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 may happen when indexes are lower. But this is an imperfect relationship
- Oil prices climbed to $85.86 from $83.23 a barrel. (Bad for mortgage rates*.) Energy prices play a prominent role in creating inflation and also point to future economic activity
- Gold prices increased to $1,725 from $1,722 an ounce. (Neutral for mortgage rates*.) It is generally 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 — moved up to 45 from 40 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 movement of less than $20 on gold prices or 40 cents on oil ones is a change of 1% or less. 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 look likely to fall. 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 broader 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 will happen to mortgage rates in the coming hours, days, weeks or months.
Are mortgage and refinance rates rising or falling?
The chances of the Federal Reserve hiking general interest rates by 75 basis points (0.75%) on Sep. 21 increased yesterday. The Financial Times summed up the situation in a subhead: “Fed chair doubles down on hawkish message and says central bank needs to act ‘forthrightly’“
You might have thought markets would have gotten the message the first 10 times Chair Jerome Powell said this. But some apparently still think he’s bluffing. So, there he was again yesterday, saying the same thing.
|It is very much our view, and my view, that we need to act now forthrightly, strongly, as we have been doing, and we need to keep at it until the job is done.|
|— Fed Chairman Jerome Powell, Sep. 8, 2022|
Fed and MBSs
One of the main reasons mortgage rates plumbed new lows during the pandemic was that the Fed bought industrial quantities of mortgage-back securities (MBSs), the type of bond that largely determines those rates. As of yesterday, it owned $2.7 trillion of MBSs.
The extra demand created by the Fed pushed up the price of MBSs, which inevitably pulled down their yields — and therefore mortgage rates. This was part of the process called “quantitative easing” (QE). But we’re now in a period of “quantitative tightening” (QT).
For a while earlier this year, I was worried that the Fed might dump too many of its MBSs into the bond market over a relatively brief period, pushing up mortgage rates even higher when they were already rising. But that probably hasn’t happened much.
The quantity the Fed can sell each month will rise this month to $35 billion. That’s a lot, but not compared to its $2.7 trillion holding.
And, yesterday, the New York Fed said it expected sales within a “range between $20 and $30 billion over the next several months.” Click that link if you want a peek under the hood.
So, I’m not expecting the Fed’s runoff of its MBS assets to affect mortgage rates too much over the rest of this year. That’s good. But the risks from persistent inflation and the Fed’s rate hikes remain.
And I still suspect that mortgage rates won’t fall far or for long between now and 2023. But some experts disagree: see Fannie Mae’s and the Mortgage Bankers Association’s forecasts below.
Read the weekend edition of this daily article for more background.
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.
Rates then bumbled along, moving little for the following eight or nine months. But they began rising noticeably that September. Unfortunately, they’ve been mostly shooting up since the start of 2022, although they’ve been kinder since May.
Freddie’s Sep. 8 report puts that same weekly average for conventional, 30-year, fixed-rate mortgages at 5.89% (with 0.7 fees and points), up from the previous week’s 5.66%.
Note that Freddie expects you to buy discount points (“with 0.8 fees and points”) on closing that earn you a lower rate. If you don’t do that, your rate would be closer to the ones we and others quote.
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 two quarters of 2022 (Q3/22, Q4/22) and the first two quarters of next year (Q1/23, Q2/23).
The numbers in the table below are for 30-year, fixed-rate mortgages. Fannie’s forecast appeared on Aug. 22 and the MBA’s on Aug. 23. Freddie’s came out around Jul. 21. But it now releases forecasts only quarterly. So, expect its figures to look stale soon.
Of course, given so many unknowables, the whole current crop of forecasts might be even more speculative than usual. And their past record for accuracy hasn’t been wildly impressive. Personally, I think they’re too optimistic.
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.