Today’s mortgage rates
Average mortgage rates fell moderately yesterday. They’ve been on a roll recently and are appreciably lower than they were both seven days ago and at the start of November.
With luck, mortgage rates might move lower again next week. However, that will depend on several employment reports next week, culminating in Friday’s official jobs report for November. More on that below.Find and lock a low rate
Current mortgage and refinance rates
|Conventional 30-year fixed|
|Conventional 30-year fixed||7.528%||7.567%||Unchanged|
|Conventional 15-year fixed|
|Conventional 15-year fixed||7.087%||7.146%||+0.1|
|Conventional 20-year fixed|
|Conventional 20-year fixed||7.498%||7.562%||Unchanged|
|Conventional 10-year fixed|
|Conventional 10-year fixed||7.435%||7.579%||Unchanged|
|5/1 ARM Conventional|
|5/1 ARM Conventional||7.594%||8.044%||+0.12|
|30-year fixed FHA|
|30-year fixed FHA||7.281%||7.945%||Unchanged|
|15-year fixed FHA|
|15-year fixed FHA||6.898%||7.362%||+0.07|
|30-year fixed VA|
|30-year fixed VA||7.256%||7.493%||Unchanged|
|15-year fixed VA|
|15-year fixed VA||6.697%||7.037%||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 See our rate assumptions here.|
Should you lock a mortgage rate today?
Despite recent falls in mortgage rates, I’m planning to stick at least for another week with my cautious recommendation to lock early. However, if next Friday’s jobs report shows the labor market continuing to cool, I’ll revisit my stance.
I still have niggling doubts about how sustainable the current run of falls will be. Yes, inflation continues to fall, though only slowly. But the economy remains fundamentally strong in many areas. And that’s rarely good for mortgage rates.
So, at least for the next six days, 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, with so much uncertainty at the moment, your instincts could easily turn out to be as good as mine — or better. So let your gut and your own tolerance for risk help guide you.
What’s moving current mortgage rates
Next week is mostly about employment reports. These include the October job openings and labor turnover survey (JOLTS) on Tuesday and the November ADP employment survey of the private sector on Wednesday.
But by far the most potentially influential of next week’s economic reports is Friday’s jobs report for November, which is formally called the employment situation report. Some months, this is the most important economic report of all.
Markets are expecting all three of next week’s employment reports to show the labor market to be tightening. That contradicts the widespread narrative that the economy is weakening and is one of the reasons I’ve been so hesitant to change my rate lock recommendations. Mortgage rates tend to rise when the economy is doing well.
Also next week, we’re due to see two November purchasing managers’ indexes (PMIs) for the services sector. One will come from S&P and the other from the Institute for Supply Management (ISM).
These measure the volume of new orders crossing buying department desks and so are a good indicator of future economic activity. Markets are expecting the S&P one to hold steady and the ISM PMI to improve slightly. Again, these are not the signs of a slowing economy that typically drag mortgage rates lower.
I’ll brief you more fully on each of next week’s reports on the morning before it’s due to be published.
The Federal Reserve’s policy on general interest rates doesn’t directly affect mortgage rates. But it most certainly does influence them.
Yesterday, Fed Chair Jerome Powell gave a speech that appeared to help mortgage rates, even though he said nothing new. Longstanding readers will have a sense of déjà vu at this point.
Mr. Powell actually said, “It would be premature to conclude with confidence that we have achieved a sufficiently restrictive stance,” meaning he couldn’t rule out further hikes in general interest rates. He also said it was too soon “to speculate on when policy might ease,” meaning when the Fed might begin cutting rates.
However, yesterday’s Wall Street Journal (paywall) interpreted his remarks thus: “Fed’s Interest Rate Hikes Are Probably Over, but Officials Are Reluctant to Say So,” according to a headline. And that reflects a widespread view in markets.
We’ve been in this situation where investors hear what they want the Fed to say rather than what it actually says several times recently and each time it’s ended in tears.
Of course, this time, markets might turn out to be right. I think that’s quite likely. But blind optimism makes me nervous and is another reason for my niggling doubts about future mortgage rates.
Economic reports next week
See above for details about the more important economic reports next week.
In the following list of next week’s reports, only those in bold typically have the potential to affect mortgage rates appreciably. The others probably won’t have much impact unless they contain shockingly good or bad data.
- Monday — October factory orders
- Tuesday — October job openings and labor turnover survey (JOLTS). Plus November PMIs from S&P and the ISM
- Wednesday — November ADP employment report. Plus revised productivity figures for the third quarter of this year
- Thursday — Initial claims for jobless benefits for the week ending Dec. 2
- Friday — November jobs report. Plus first reading of consumer sentiment in December
Watch out for Friday’s jobs report.
Mortgage rates forecast for next week
Mortgage rates next week might fall again. That’s based on their recent downward momentum showing few signs of slowing. However, Friday’s jobs report could change the outlook if it shows the labor market tightening even more than expected.
How your mortgage interest rate is determined
A bond market generally determines mortgage and refinance rates. It’s the one where trading in mortgage-backed securities takes place.
And that’s highly dependent on the economy. So mortgage rates tend to be high when things are going well and low when the economy’s in trouble. But inflation rates can undermine those tendencies.
But you play a big part in determining your own mortgage rate in five ways. And you can affect it significantly by:
- Shopping around for your best mortgage rate — They vary widely from lender to lender
- Boosting your credit score — Even a small bump can make a big difference to your rate and payments
- Saving the biggest down payment you can — Lenders like you to have real skin in this game
- Keeping your other borrowing modest — The lower your other monthly commitments, the bigger the mortgage you can afford
- Choosing your mortgage carefully — Are you better off with a conventional, conforming, FHA, VA, USDA, jumbo or another loan?
Time spent getting these ducks in a row can see you winning lower rates.
Remember, they’re not just a mortgage rate
Be sure to count all your forthcoming homeownership costs when you’re working out how big a mortgage you can afford. So, focus on something called you “PITI.” That stands for:
- Principal — Pays down the amount you borrowed
- Interest — The price of borrowing
- Taxes — Specifically property taxes
- Insurance — Specifically homeowners insurance
Our mortgage calculator can help with these.
Depending on your type of mortgage and the size of your down payment, you may have to pay mortgage insurance, too. And that can easily run into three figures every month.
But there are other potential costs. So, you’ll have to pay homeowners association dues if you choose to live somewhere with an HOA. And, wherever you live, you should expect repairs and maintenance costs. There’s no landlord to call when things go wrong!
Finally, you’ll find it hard to forget closing costs. You can see those reflected in the annual percentage rate (APR) that lenders will quote you. Because that effectively spreads them out over your loan’s term, making that rate higher than your straight mortgage rate.
But you may be able to get help with those closing costs and your down payment, especially if you’re a first-time buyer. Read:
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 result is a good snapshot of daily rates and how they change over time.