Today’s mortgage rates
Average mortgage rates rose moderately yesterday. But things could have been a lot worse following yesterday’s surprisingly strong jobs report. And there’s good news: Those rates were very slightly lower last night than they were a week earlier.
I can't provide a forecast for how mortgage rates will move next week. That’s unknowable because it hinges on the numbers in next Tuesday’s consumer price index (CPI) and next Wednesday’s meeting of the Federal Reserve’s rate-setting committee. If those bring good news, those rates might move lower. But, if they bring bad, we could get higher mortgage rates. More on that below.Find and lock a low rate
Current mortgage and refinance rates
|Conventional 30-year fixed|
|Conventional 30-year fixed||7.613%||7.652%||Unchanged|
|Conventional 15-year fixed|
|Conventional 15-year fixed||7.165%||7.225%||Unchanged|
|Conventional 20-year fixed|
|Conventional 20-year fixed||7.376%||7.421%||Unchanged|
|Conventional 10-year fixed|
|Conventional 10-year fixed||7.391%||7.526%||Unchanged|
|30-year fixed FHA|
|30-year fixed FHA||7.113%||7.801%||Unchanged|
|15-year fixed FHA|
|15-year fixed FHA||7.01%||7.474%||Unchanged|
|30-year fixed VA|
|30-year fixed VA||6.992%||7.225%||Unchanged|
|15-year fixed VA|
|15-year fixed VA||6.75%||7.091%||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?
What a shame! I was hoping to have an excuse to change my recommendations (below) by now. And I was pinning most of my hopes on yesterday’s jobs report. If that had shown weakness in the labor market, I’d finally have some evidence that the economy was slowing. And that’s typically good for mortgage rates.
However, yesterday’s report showed the opposite: surprising resilience in the job market that suggests the economy remains strong. Now, I’m hoping next Tuesday’s CPI inflation report and Fed meeting will deliver the excuse I need.
But, for now, 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
This week has been mainly about employment numbers and especially Friday’s official jobs report. Next week will be mostly about inflation figures and especially Tuesday’s consumer price index (CPI) report.
Last Thursday, The Wall Street Journal (paywall) explained why the CPI is likely to be critical. Under the headline, “The Most Important Debate on Wall Street: Is Inflation Licked?,” it said:
“Confident that the Federal Reserve is now cruising to its goal of 2% inflation, investors have dialed up bets that the central bank will start cutting interest rates by spring to prevent a recession. That would mark the end of an inflation-fighting campaign that has rattled markets since early 2022.
“Still, the Fed’s preferred inflation gauge remains elevated at around 3%. And some investors are concerned it could be hard to get all the way back to 2%, leaving stocks and bonds vulnerable to a pullback.”
It’s that pullback, which would almost certainly mean appreciably higher mortgage rates, that’s been bothering me for a while. And it’s why I haven’t adjusted my rate lock recommendations (above) to reflect recent falls in those rates. I’ve been scared that markets would finally face reality and push up mortgage rates just as I started to advise readers to float theirs.
Now, I’m not claiming that I’m right and all those Wall Street geniuses are wrong. It’s perfectly possible that their wagers will pay off.
But they sure ain’t betting on a certainty. And recent economic data suggest their risk levels are higher than perhaps they realized.
Tuesday’s CPI and the Fed
Indeed, their own analysts are forecasting that the November CPI will plateau (0.0%) across all items, as it did in October. Meanwhile, they expect “core” CPI (with volatile food and energy prices stripped out) to actually rise slightly that month (up by 0.3% compared to October’s 0.2%).
This really isn’t suggestive of “the Federal Reserve ... now cruising to its goal of 2% inflation.” And the Fed is unlikely to see itself as cruising anywhere.
That doesn’t mean the Fed will announce a hike in general interest rates next Wednesday, following the December meeting of its rate-setting committee. That’s currently looking unlikely.
But, if the CPI turns out as expected, the Fed may well strongly reiterate its longstanding position, which is that further rate hikes remain firmly on the table while it’s much too soon to even think about rate cuts. And that could be bad for mortgage rates.
There are a lot of ifs and buts and implied perhapses in that scenario. And things may turn out very differently.
But what I’ve described is a distinct possibility. And, if it materializes, it could bring higher mortgage rates on both Tuesday and Wednesday.
The rest of next week
Thursday’s retail sales for November is the other highly influential report due next week. Consumer spending accounts for a large proportion of America’s gross domestic product, so investors typically take these sales figures seriously.
Markets are expecting them to inch lower (-0.1%) just as they did in October. If the report shows sales were higher than expected, mortgage rates might rise. If they were even lower, those rates could fall.
The CPI measures changes in the prices consumers pay in a particular month. But two other inflation reports next week gauge how prices are moving earlier in the supply chain.
Wednesday’s producer price index (PPI) looks at prices in wholesalers’ warehouses and at factory gates. And Thursday’s import price index (IPI) covers the prices of goods and imported services landing at American ports and airports. Both are for November.
Markets are expecting the PPI to rise more quickly than previously and the IPI to slow. But, even though their readings often show up in future CPIs, markets tend not to be highly influenced by them.
It’s worth just mentioning November’s industrial production and capacity utilization figures, which are due out on Friday. Industry represents a much smaller proportion of the American economy than it once did. And investors often shrug off these figures.
But both are expected to show improvements over October. And, once again, such an outcome would provide further evidence of a strong economy.
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.
- November consumer price index
- Wednesday — Fed interest rate decision (2 p.m. Eastern) and Fed Chair news conference 30 minutes later. Plus November producer price index.
- Thursday — November retail sales. And November import price index. Plus initial claims for jobless benefits for the week ending Dec. 9
- Friday — November industrial production and capacity utilization
There could be surprises on any day next week excluding Monday.
Mortgage rates forecast for next week
Mortgage rates next week are unpredictable. Any of those bold items in the above bullet points could tip market sentiment and send those rates soaring or tumbling.
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.