Mortgage And Refinance Charges Right this moment, July 13
Today’s mortgage and refinancing rates
Average mortgage rates rose slightly yesterday. But they still remain at the lower end of the limited range that they have been hovering for months.
This morning’s consumer price index was hotter than expected. Nevertheless, mortgage rates are likely to remain stable or almost stable today. However, markets remain unpredictable.
Find and lock a cheap rate (July 14, 2021)
Current mortgage and refinancing rates
|program||Mortgage rates||Effective interest rate*||change|
|Conventionally fixed for 30 years||2,811%||2,811%||Unchanged|
|Conventionally fixed for 15 years||2.125%||2.125%||Unchanged|
|Conventional 20 years old||2,625%||2,625%||Unchanged|
|Conventionally 10 years fixed year||1,944%||1,984%||Unchanged|
|30 years permanent FHA||2,688%||3,343%||+ 0.02%|
|15 years fixed FTA||2.5%||3,101%||-0.02%|
|5/1 ARM FHA||2.5%||3.213%||Unchanged|
|30 years of permanent VA||2,295%||2,467%||+ 0.04%|
|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 (July 14, 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?
Do we see the beginning of a move towards higher mortgage rates? May be. However, it is more likely that there will be a limited rebound after hitting recent lows. Such bounce-backs are common. They are not technically “market corrections” (this jargon is subject to major changes), but they correct themselves after going too far.
Whether these rates continue to rise, or pause, or fall will likely depend on new economic data, some of which is slated for this week. But the experts agree that they will climb to the top soon. Unfortunately, nobody knows exactly when.
So my personal rate lock recommendations must remain:
- LOCK when close in 7th Days
- LOCK when close in fifteen Days
- LOCK when close in 30th Days
- LOCK when close in 45 Days
- LOCK 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.
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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. However, some types of refinancing are higher after a regulatory change
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 on
Investors don’t seem sure what is going on. The latest economic data suggests that the US economic recovery is well on its way to delivering a record year. But there are dangers – mostly related to COVID-19 – that make them nervous. So they seem to take turns panicking and regaining self-confidence.
This is true of many markets, including the market in which mortgage-backed securities (MBS) are traded. And these securities directly determine mortgage rates.
So changing investor sentiment is key to what your monthly payment will be for your next home.
Fed continues to threaten low mortgage rates
However, depending on when you need to lock up, Federal Reserve action could pose an even bigger threat to your future monthly payments than investor sentiment. That’s because the Fed is currently buying $ 40 billion worth of MBS every month. And that keeps mortgage rates artificially low.
But barring a few economic disasters, pretty much everyone (including their own executives) recognizes that the Fed will likely need to gradually reduce those purchases this year (“taper” in Fed parlance). Here is Comerica Bank’s chief economist’s opinion on what could happen and when. (The FOMC is the Fed’s monetary policy committee):
We expect a more active discussion within the FOMC on reducing security purchases along with more public comment at the upcoming FOMC meeting on 27/28. July. In the coming comment, we expect the Fed to confirm that it will start cutting asset purchases later this year. At the moment, the time window for the eventual start of tapering looks like it will start at the end of September and extend to the end of December.
If the Fed is concerned about the economy overheating and inflation picking up, it could begin to slow down in late September. You could use their annual Jackson Hole conference in late August to signal an expansion in late September or October. If they are less concerned about inflationary pressures, they could wait until the FOMC meeting in mid-September to announce that they will start reducing by the end of December. Much depends on how the Fed views inflationary pressures.
– Comerica Bank, e-newsletter “US Economic Outlook July 2021” received on July 12, 2021
This morning’s hot consumer price index adds to the pressure the Fed is under to fall sooner rather than later.
It’s worth noting that the last time the Fed cut bond purchases in 2013, mortgage rates soared when it announced its plans, months before the cut actually began. Will history repeat itself this time? We can’t be sure.
But it’s clearly a definite possibility. And if it repeats itself, we could see significantly higher mortgage rates this month or next.
Mortgage Rates and Inflation: Why Are Rates Rising?
For more background information, see the weekend edition of this Saturday column, which offers more space for in-depth analysis.
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, in April and since then, those increases have been largely replaced by decreases, if only marginally. Freddie’s July 8th report puts that weekly average at 2.9% (with 0.6 fees and points). Low from 2.98% 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 were updated on June 16 and the MBAs on June 18. Freddie’s forecast is dated April 14th, but it is now only updated quarterly. So his numbers look out of date.
|Forecasters||Q3 / 21||Q4 / 21||Q1 / 22||Q2 / 22|
However, with so many imponderables, current forecasts could be even more speculative than usual.
Find your lowest rate 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 plan (July 14, 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. Since we average a range of prices, 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.