Mortgage And Refinance Charges As we speak, Aug. 24
Today’s mortgage and refinancing rates
Average mortgage rates rose yesterday. But only by the smallest measurable amount. So they stay exceptionally low.
and Mortgage rates are likely to remain stable today or increase only slightly. But as always, that can change over the course of the hours.
Find and lock a cheap rate (August 25, 2021)
Current mortgage and refinancing rates
|program||Mortgage rates||Effective interest rate*||Change|
|Conventionally fixed for 30 years||2,768%||2,768%||Unchanged|
|Conventionally fixed for 15 years||1.99%||1.99%||Unchanged|
|Conventional 20 years old||2,375%||2,375%||-0.12%|
|Conventionally fixed for 10 years||1.86%||1,901%||Unchanged|
|30 years permanent FHA||2.67%||3,325%||-0.02%|
|15 years fixed FTA||2,428%||3,029%||+ 0.04%|
|5/1 ARM FHA||2.5%||3,201%||Unchanged|
|30 years of permanent VA||2.25%||2,421%||-0.01%|
|15 years fixed VA||2.25%||2,571%||Unchanged|
|Prices are provided by our partner network and may not reflect the market. Your rate can be different. Click here for an individual price offer. View our rate assumptions here.|
Find and lock a cheap rate (August 25, 2021)
COVID-19 mortgage updates: Mortgage lenders are changing rates and rules due to COVID-19. To learn how the coronavirus could affect your home loan, click here.
Should You Lock A Mortgage Rate Today?
Mortgage rates have barely moved in the last few weeks. Yes, there were the usual little daily changes. But they are as good as saved.
However, I continue to believe that the risks of interest rate fluctuations outweigh the likely benefits. So I’m staying in the Pro-Lock camp.
And for the time being, my personal rate lock recommendations remain:
- LOCK when close in 7th Days
- LOCK when close in fifteen Days
- LOCK when close in 30th Days
- HOVER when close in 45 Days
- HOVER when close in 60 Days
However, I do not claim to have perfect foresight. And your personal analysis could be as good as mine – or better. So you can be guided by your instincts and your personal willingness to take risks.
Market Data Affecting Mortgage Rates Today
Here’s a snapshot of the score this morning at around 9:50 a.m. ET. The dates compared to about the same time yesterday were:
- the 10 year Treasury note yield increased from 1.26% to 1.28%. (Bad for mortgage rates.) More than any other market, mortgage rates usually follow these particular government bond yields
- Important stock indices were higher shortly after opening. (Bad for mortgage rates.Often times, when investors buy stocks, they sell bonds, which depresses the prices of those stocks and increases yields and mortgage rates. The opposite can happen when the indices are lower
- Oil prices climbed to $ 66.92 from $ 64.88 a barrel. (Bad for mortgage rates *.) Energy prices play a big role in inflation and also indicate future economic activity.
- Gold prices Inches up to $ 1,806 of $ 1,805 an ounce. (Neutral for mortgage ratesIn general, it is better for interest when gold rises and worse when gold falls. Gold tends to rise when investors worry about the economy. And worried investors tend to cut rates
- CNN Business Fear and Greed Index – increased from 30 to 36 From 100. (Bad for mortgage rates.) “Greedy” investors push bond prices down (and interest rates up) when they exit the bond market and invest in stocks, while “fearful” investors do the opposite. So lower values are better than higher
* A change of less than $ 20 in gold prices or 40 cents in oil prices is a fraction of 1%. Therefore, when it comes to mortgage rates, we only count meaningful differences as good or bad.
Reservations about markets and prices
Before the pandemic and the Federal Reserve’s interventions in the mortgage market, you could look at the numbers above and make a pretty good guess as to what would happen to mortgage rates that day. But that is no longer the case. We still use the phone every day. And they are mostly right. But our record for accuracy won’t hit its old highs until things settle down.
Use markets only as a rough guide. Because they have to be exceptionally strong or weak to be able to rely on them. But with this reservation so far Mortgage rates are likely to either stay the same today or increase by a few inches. Note, however, that “intraday swings” (when prices change direction during the day) are a common feature these days.
Find and lock a cheap rate (August 25, 2021)
Important information about current mortgage rates
Here are some things you need to know:
- Usually mortgage rates go up when the economy is doing well and go down when the economy is in trouble. But there are exceptions. Read ‘How Mortgage Rates Are Determined and Why You Should Care About It
- Only “top notch” borrowers (with great credit scores, high down payments, and very healthy finances) will get the extremely low mortgage rates you see advertised
- Lenders vary. Yours may or may not follow the crowd when it comes to daily price action – though they usually all follow the broader trend over time
- When the daily price changes are small, some lenders adjust the closing costs and leave their price lists unchanged
- The refinancing rates are usually close to those for purchases. And a recent regulatory change has closed a pre-existing loophole
So there is a lot going on here. And no one can claim to know for sure what will happen to mortgage rates in the coming hours, days, weeks, or months.
Are mortgage and refinancing rates rising or falling?
today and so forth
Yesterday, the Food and Drug Administration (FDA) fully approved the Pfizer-BioNTech COVID-19 vaccine. And that was probably the reason for the modestly higher mortgage rates that day and this morning.
Where? Chances are, investors are hoping this will improve adoption of COVID-19 vaccines, thereby reducing the economic damage that the Delta variant could cause. Many who have been reluctant to vaccinate have been swayed by the argument that these vaccines may be unsafe because they are still in clinical trials. And at least that no longer applies to the Pfizer product.
When investors think the economy will do better, they usually sell safer bonds and buy riskier, but higher-yielding stocks. This lower demand lowers the price of bonds and increases their yields. It is a mathematical inevitability that bond prices and yields will reverse.
Friday remains a crunch day
Yesterday I explained why this Friday could be a crunch day. Then two big events happen:
- The Federal Reserve Chairman will be delivering a speech this morning at 10 a.m. ET that may reveal a little more about the Fed’s evolving monetary policy
- A key measure of inflation will be released 90 minutes before this speech
Both have the potential to move mortgage rates noticeably. But will they?
Nobody knows. It depends on what the speech and inflation report are saying and how unexpected the news they generate is. So there is a good chance that nothing will change. And it’s only possible that they’ll drive down mortgage rates. But maybe a bit more likely that they will send these rates higher.
Neither you nor I can be sure what will happen. However, there is an added risk for you to weigh up when deciding whether to lock your course or keep it unlocked.
For more background information, see Saturday’s weekend edition of this column.
Mortgage Rates and Inflation: Why Are Rates Rising?
The general trend in mortgage rates was clearly declining for much of 2020. And according to Freddie Mac, a new weekly all-time low was hit 16 times in the past year.
The latest weekly record low was hit on January 7th at 2.65% for 30-year fixed-rate mortgages. But then the trend was reversed and interest rates rose.
However, these increases have been largely replaced by decreases since April, albeit typically small. Freddie’s August 19th report builds on this weekly average 2.86% (with 0.7 fees and points), Low from 2.87% the previous week.
Expert predictions for mortgage rates
Looking ahead, Fannie Mae, Freddie Mac, and the Mortgage Bankers Association (MBA) each have a team of economists devoted to monitoring and forecasting developments in the economy, real estate and mortgage rates.
And here are their current interest 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. Fannies and the MBAs were updated on August 19th. Freddies was last updated on July 15th as these numbers are now only published quarterly.
|Forecasters||Q3 / 21||Q4 / 21||Q1 / 22||Q2 / 22|
However, with so many imponderables, current forecasts could be even more speculative than usual.
All of these predictions anticipate higher mortgage rates soon. But the differences between the forecasters are stark. And Fannie may not be involved in curbing Federal Reserve mortgage support while Freddie and the MBA do.
Find your lowest price today
Some lenders have been terrified by the pandemic. And they are limiting their offerings to vanilla-flavored mortgages and refinancing.
But others remain brave. And you can still likely find the refinance, investment mortgage, or jumbo loan you want. All you have to do is look around.
But of course, no matter what type of mortgage you want, you should compare widely. As a federal regulator, the Consumer Financial Protection Bureau says:
Shopping for your mortgage has the potential to result in real savings. It may not sound like much, but if you save only a quarter point in interest on your mortgage, you will save thousands of dollars over the life of your loan.
Confirm your new price (August 25, 2021)
Mortgage rate methodology
The mortgage report receives interest rates from several credit partners on a daily basis according to selected criteria. We’ll find an average interest rate and an APR for each type of loan shown on our chart. By averaging a number of rates, this will give you a better idea of what you might find in the market. In addition, we determine average interest rates for the same types of credit. For example FHA fixed with FHA fixed. The end result is a good snapshot of the daily rates and how they change over time.