Mortgage Rate News

Mortgage rates held their ground today, keeping them in line with long-term lows achieved over the past 2 weeks. To be fair, it was the previous week that offered the biggest benefits, but last week was no slouch. Factoring out the first few days of January, it would have been the best week for mortgage rates since April 2018. It was a relatively quiet day for financial markets with the bonds that underlie mortgage rates trading in mostly the same territory as last week. It remains to be seen how markets will react to the absence of the typical spread of economic data (much of which is on hold due to the government shutdown ). Beyond that, the shutdown could certainly begin to have an effect on the economy itself although it's hard to say how big of an effect that would be. With this now being

Mortgage rates improved today, breaking a 3-day streak with effectively no change. This gets us part of the way back down to the long-term lows achieved at the end of last week. At that time, the average lender was quoting conventional 30yr fixed rates that were roughly 5/8ths of a percentage point (0.625%) lower than the long-term highs seen at the beginning of November. Rates then lurched higher by Tuesday of this week, eroding as much as a quarter of a point from some scenarios. Today's gains restored about half of that weakness for a net improvement of 0.5% from November's highs. At any time before last week, today's rates would be the lowest since April 2018. The swiftness with which those lows were achieved led some investors to worry about a swift bounce back. But it seems that as long

Mortgage rates were unchanged again today, despite moderate weakness in underlying bond markets. Bonds are the primary ingredient used in determining mortgage rates, but the timing of market movement and lender preferences can result in discrepancies between the two. For instance, if market weakness happens late enough in the trading day, many mortgage lenders will wait until the following day to do anything about it in terms of updating their rate sheet offerings. Additionally, the bonds that dictate mortgage rates can trade slightly better or worse than the mainstream bond market (essentially, US Treasuries). Both of the those factors are in play today. Treasuries weakened more noticeably than mortgage-backed bonds, primarily because Treasuries had strengthened at a faster pace last week

Mortgage rates held steady today, after moving higher for the past 3 days. Underlying market movement was slightly calmer than it has been in recent days. Stocks were less eager to make new highs and bond yields (a key consideration for mortgage rates) actually moved slightly lower. Taken together, this could be a sign that this week's small spike in mortgage rates may have run its course. On the other hand, the battlefield of market-related decision making is riddled with casualties from those who've jumped to such conclusions too early. In other words, we can see some potentially promising developments in for rates when it comes to the way markets traded today, but it's too soon to plan on rates falling back to recent lows just yet. Loan Originator Perspective A decent treasury auction and

Mortgage rates rose moderately for the 3rd day in a row today, bringing them to the highest levels since December 31st for the average lender. In outright terms, this equates to an increase of an eighth of a percentage point (.125%) since the most recent lows last Thursday. While it's only 3 days of weakness in the mortgage market, the concern is that it could be part of a much larger market trend. Stock prices and interest rates moved lower together for the better part of 2 months. The drop was relatively extreme for stocks, and nothing to shake a stick at for rates. The risk is that we're only in the early phase of a bigger correction. While that would be great news for stock market investors, it would be less pleasant for those with a vested interest in lower mortgage rates. All of the above

Mortgage rates were higher again today, extending a 2-day move from the lowest levels since early 2018. The size and pace of the late 2018 improvements introduced the risk of a bounce even before last Friday's key events. But after those events, the correction has been fairly swift. Let's break those last two sentences down, as they contain a lot of implied information that isn't readily accessible without some background. Rates are based on trading in the bond market. Like other markets, when momentum becomes lopsided, there's a risk of a correction. Momentum had arguably become lopsided in favor of lower stocks prices and interest rates heading into last week. That created one aspect of risk for low rates. The other aspect of risk came from events that transpired on Friday. Bond markets

Mortgage rates hit the lowest levels in nearly a year as of yesterday afternoon. In general, they've had a one track mind for the better part of two months. Today brought the first real challenge to the recent trend. In plain terms, yesterday brought us the biggest single day drop in mortgage rates of this cycle and today completely erased it. As the headline suggests, today's jobs report had quite a lot to do with the bounce. Strong economic data is generally an enemy to low interest rates, but the impacts vary widely depending on the report. The jobs report is universally considered to be the most important of the monthly economic data. This one in particular was likely to be scrutinized due to recent policy comments from the Fed. It ended up being one of the strongest examples in more than

Mortgage rates have been plummeting , depending on your definition of the word. To be sure, the past 2 months have no competition in nearly 3 years. The past few days have been special in their own right. Whereas there was cause for concern about the new year bringing a bounce for stock prices and mortgage rates, stocks haven't done much of anything in the context of their late-2018 volatility, and mortgage rates have dropped another eighth of a percentage point (or more, depending on the lender). There are now lenders quoting 30yr fixed rates as low as 4.375% on top tier scenarios with the average lender back to 4.5%. That's quite a jump from the 5.125% average at the recent highs (just 2 months ago). There's still risk associated with the new year, however. Tomorrow's jobs report is still

Mortgage rates didn't have much to celebrate in 2018--at least not until the last few months. But those last few months were quite nice! Despite uncertainty heading into the new year, rates managed to drop again to kick things off--effectively keeping the New Year's party going. The average lender is now down to the lowest rates since early 2018 . For some, that means April. For others, it means February. Either way, it's meaningfully lower compared to the recent highs. For example, lenders are quoting rates that are roughly half a percentage point lower compared to early November. On top of this, mortgages had been underperforming other interest rates so much in 2018 that there may be a correction to that trend (i.e. mortgages were so badly shunned by investors compared to Treasuries that

Mortgage rates moved lower by an almost imperceptible amount today. The improvement was enough to bring the average lender to the lowest levels since the end of August, 2018. In other words, these are the best rates in 4 months. 2 months ago, all hope seemed lost. Rates were the highest in years and there were few reasons to expect the pain to subside, short of a massive meltdown in stocks or a big picture shift in the economy. As you're likely away, stocks indeed tanked heading into the 4th quarter. And as I've mentioned many times since, that stock weakness was largely responsible for rates' ability to reclaim lost ground. This raises serious questions for the beginning of 2019 because the economic data and other indicators aren't necessarily looking like they justify all the pain we've seen

Mortgage rates were unchanged to slightly lower today, which is a major victory considering how yesterday left off. Specifically, bond markets had weakened significantly in the afternoon. Weaker bonds coincide with mortgage lenders raising rates, but only if there's enough weakness early enough in the day. Yesterday's pace resulted in some lenders raising rates right away while others put it off until this morning. All of the above meant that bond markets would have to have an amazing night in Europe and Asia if rates were to do anything other than move higher today. And that's exactly what happened (the amazing night in Europe and Asia). While this doesn't mean we're out of the woods in terms volatility going forward, it does mean we caught a friendly break. When such breaks occur near the

Mortgage rates were unchanged in some cases today and higher in others. The discrepancy is a result of the timing of today's market movements. The most important thing to know is that lenders who are unchanged today will almost certainly be higher tomorrow, unless the bond market stages an impressive comeback between now and tomorrow morning. Lenders have the final say in the mortgage rates they make available to borrowers, but their decisions are informed primarily by the bond market. Weaker bonds = higher rates, and vice versa. Bonds weakened today--modestly at first, then significantly in the afternoon--but it didn't happen quickly enough for every lender to see the reason to change their mortgage rate offerings in the middle of the day. As such, those lenders will simply be accounting for

Mortgage rates were steady to slightly higher yet again today. This reinforces our sense from yesterday that rates may have already found their post-Fed floor. The thing that makes today's modest weakness somewhat surprising is the fact that underlying bond markets actually suggested rates could improve. Actually, it would be more surprising to see this during a more normal time of year for the mortgage market. On the days leading up to the Christmas holiday, it's not uncommon to see lenders being a bit more conservative with mortgage rate offerings. In the bigger picture , rates are still very close to their lowest levels in months. In fact, with the exception of the past 2 days, today's rates are easily the lowest since the beginning of September. In general, if the broader economy (and the

Mortgage rates were steady to slightly higher today. As such, they remain quite close to their lowest levels in roughly 4 months--a distinction achieved yesterday following the Fed announcement and press conference. Actually, it may be more fair to give credit to sharp losses in the stock market for yesterday's drop in rates. Today, however, another move lower in stocks failed to push rates any lower. In other words, the bond market (which dictates rate movement) seems to have found its floor as of yesterday afternoon. Rates weren't willing to break yesterday's best levels despite numerous attempts today--not to mention the stock market losses. When we talk about "numerous attempts" or numerous iterations of any specific interest rate move during a single business day, we'll generally need

Mortgage rates fell today even though the Fed "raised rates." What's up with that? There are all kinds of rates. Some are fixed. Some are adjustable. Some apply to longer-term debt (like mortgages) while others govern very short time frames (like overnight!). Short and long term rates can affect one another, but they don't always move in the same direction or by the same amount. The rate the Fed adjusts (aptly named, the Fed Funds Rate), governs only the shortest-time frames (generally overnight loans among big banks). That means mortgage rates don't have to follow the Fed Funds Rate, even though Fed policy has a profound effect on overall interest rate volatility. The reason that mortgage rates fell after the Fed rate hike is even easier to understand. It has to do with how traders account

Mortgage rates fell today as lenders got caught up with the friendly move in the bond market that we noted yesterday. Incidentally, today's bond market movement was also friendly (i.e. it suggested rates should continue to move lower). There's almost never only one reason that financial markets are doing whatever they're doing, even if there is frequently one reason that's bigger than the others. Both stocks and oil prices were high on the list of reasons for today's interest rate movement. When it comes to stocks, big losses frequently help rates (investors often seek safe-havens when stocks are panicking, and bond markets can be one of those havens. More bond buying = lower rates). When it comes to oil prices, the relationship with rates is far less predictable , but when oil is falling rapidly

Mortgage rates were fairly flat yet again today. Unlike Friday, today's market movement made a case for a bit of a drop. "Market gains" mean different things when talking about bonds/rates (as opposed to stocks). In today's case, bond markets improved while stocks lost ground. In fact, the pace at which stocks lost ground largely explains bond market gains (investors often seek safe-havens when stocks are panicking, and bond markets can be one of those havens). As money flows into bond markets, bond prices rise and rates fall. Mortgage rates are ultimately determined by mortgage lenders, but they'll usually change rate sheets in the middle of the day if bonds are improving quickly enough. Today's bond market gains were big enough to justify so-called "reprices" among mortgage lenders, but that

Mortgage rates didn't move much today, and that's arguably a good thing. When the week began, we discussed the need for rates to cool-off after last week's rapid drop. Doing so would improve our chances of seeing recently lower rates stick around for more than a fleeting moment. Now here we are on Friday with the average lender not too far from last Friday's 3-month lows. Each passing day this week saw underlying market activity die down as investors circled the metaphorical wagons ahead of next week's big Fed announcement. Much of the recent improvement in rates has come courtesy of the market's read on the Fed. They're expected to be more "dovish" (i.e. more friendly in terms of monetary policy and rate hikes, ostensibly in response a growing case for economic deceleration). While various

Mortgage rates fell moderately today, helping them move part of the way back down toward their lowest levels in more than 3 months (seen back on Friday). The average lender continues quoting rates that are roughly 3/8ths of a percentage point lower than the highs from early November. Last Friday's low rates marked the culmination of the strongest winning streak for rates of 2018. We've been in a bit of a holding pattern since then, with next week's scheduled announcement from the Federal Reserve likely serving as the motivation for the next (and probably last) big wave of momentum for the year. "Big wave" is more of a relative term, perhaps. It may only end up being "big" relative to the current, fairly flat week leading up to it. Loan Originator Perspective Bonds continued hovering in recent

Mortgage rates rose more noticeably today as a part of a 3 day bounce after hitting the lowest levels in roughly 3 months at the end of last week. Whereas yesterday's increases weren't really worth mentioning, today's hurt--depending on the scenario. In general, this bounce was to-be-expected. Granted, we can't ever know exactly how big such bounces will be or how long they'll last, but when rates improve for as many days in a row as they recently had, a bounce is increasingly inevitable. So how bad is this one? Not too bad so far. I'm not thrilled about the "3 days" part, but really it's only been today that counts (the other two days were effectively flat). As such, tomorrow and Friday become a bit more important by way of assessing any momentum ahead of next week's Fed Announcement (which