Today’s mortgage and refinance rates 

Average mortgage rates eased lower yesterday. That was a relief after they touched their highest point in several months on Monday. But never forget that recent highs would have been greeted as unthinkable lows over almost all the last 50 years.

Unfortunately, it’s looking as if mortgage rates today are likely to resume their climb. But that may change during the coming hours.

Current mortgage and refinance rates 

COVID-19 mortgage updates: Mortgage lenders are changing rates and rules due to COVID-19. To see the latest on how coronavirus could impact your home loan, click here.

Should you lock a mortgage rate today?

Read on for details of the array of forces that are currently pushing mortgage rates higher. Might they lose some potency soon? Certainly. But, in my view, that’s less likely than those rates continuing to climb.

So 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, I don’t claim perfect foresight. And your personal analysis could turn out to be as good as mine — or better. So you might choose to be guided by your instincts and your personal tolerance for risk.

Market data affecting today’s mortgage rates 

Here’s a snapshot of the state of play this morning at about 9:50 a.m. (ET). The data, compared with roughly the same time yesterday, were:

• The yield on 10-year Treasury notes inched up to 1.64% from 1.62%. (Bad for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields
• Major stock indexes were higher soon after opening. (Bad for mortgage rates.) When investors are buying shares they’re often selling bonds, which pushes prices of those down and increases yields and mortgage rates. The opposite may happen when indexes are lower. But this is an imperfect relationship
• Oil prices fell to $81.88 from $82.23 a barrel. (Neutral for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity. 
• Gold prices edged higher to $1,781 from $1,777 an ounce. (Neutral for mortgage rates*.) In general, it is better for rates when gold rises, and worse when gold falls. Gold tends to rise when investors worry about the economy. And worried investors tend to push rates lower
• CNN Business Fear & Greed index — Website unavailable this morning

Caveats about markets and rates

Before the pandemic and the Federal Reserve’s interventions in the mortgage market, you could look at the above figures and make a pretty good guess about what would happen to mortgage rates that day. But that’s no longer the case. We still make daily calls. And are usually right. But our record for accuracy won’t achieve its former high levels until things settle down.

So use markets only as a rough guide. Because they have to be exceptionally strong or weak to rely on them. But, with that caveat, mortgage rates today look likely to rise. But be aware that “intraday swings” (when rates change direction during the day) are a common feature right now.

Find and lock a low rate (Oct 20th, 2021)

Important notes on today’s mortgage rates

Here are some things you need to know:

1. Typically, mortgage rates go up when the economy’s doing well and down when it’s in trouble. But there are exceptions. Read ‘How mortgage rates are determined and why you should care
2. Only “top-tier” borrowers (with stellar credit scores, big down payments and very healthy finances) get the ultralow mortgage rates you’ll see advertised
3. Lenders vary. Yours may or may not follow the crowd when it comes to daily rate movements — though they all usually follow the wider trend over time
4. When daily rate changes are small, some lenders will adjust closing costs and leave their rate cards the same
5. Refinance rates are typically close to those for purchases. And a recent regulatory change has narrowed a gap that previously existed

So there’s a lot going on here. And nobody can claim to know with certainty what’s going to happen to mortgage rates in coming hours, days, weeks or months.

Are mortgage and refinance rates rising or falling?

Today and soon

It may well be that a dwindling fear of the economic effects of COVID-19 is becoming the main driver of higher rates. Mortgage rates began to fall when the pandemic came to be perceived as a serious threat in April 2020.

And they’ve fallen and risen since pretty much in line with how big a hit investors think it’s giving the economy. The bigger the threat, the lower those rates have gone. That’s to be expected. Because a poor economy generally brings low rates and a thriving one high rates.

Back on Sept. 13, something strange happened. The rate of new infections in America suddenly began to tumble. On that day, there were 285,058 new cases, according to The New York Times (paywall). But, yesterday, that was down to 83,624.

And the graph shows consistent falls between the two dates. Meanwhile, hospitalization and death rates are — with a lag — now showing similar falls.

Of course, it’s always possible that we’ll experience a new wave of COVID-19 over the winter. We did during the 2020-21 one. And that peaked on Jan. 8, 2021 at 300,777 new cases that day before a rapid fall set in. It may be no coincidence that the last all-time low for mortgage rates was reported on Jan 6. Or that they rose as cases fell.

If such a new winter wave arises in 2021-22, mortgage rates may fall again, though probably not as sharply as they did in response to the last one. How come? Read on …

Unpredictable disease

One reason mortgage rates might not rise as sharply this winter as last is that way more of the population is vaccinated against SARS-CoV-2, the virus that causes COVID-19. And the 56% who are fully vaccinated are less likely to become seriously ill or die. So, with luck, the peak this winter, if any, could be less than half that of the last one. And that would mean half the economic damage.

Of course, if there’s one thing we know about the pandemic, it’s that it’s unpredictable. And, were a new strain to emerge that proved resistant to vaccines, this winter could be as bad as the last one. Similarly, some virus experts are worried that seasonal flu could be particularly bad this year, partly because it almost dropped out of sight in 2020-21.

Naturally, any pandemic or epidemic that undermines the economic recovery could bring lower mortgage rates. But let’s hope they don’t.

Other forces pushing mortgage rates higher

The two other main forces currently pushing mortgage rates higher are warm-hot inflation and the Federal Reserve’s plans to wind down its active support for low mortgage rates, probably starting in mid-November.

Right now, those seem highly likely to keep those rates climbing. But, of course, neither of them would exist without the pandemic. And a serious resurgence of the coronavirus or the emergence of a virulent influenza virus could kill them both dead.

However, nobody would want lower mortgage rates at the expense of the human deaths and misery those would bring.