Today’s mortgage and refinance rates 

Average mortgage rates just inched higher yesterday. So, over the previous week, we’ve had three rises, one fall and one holding steady.

First thing, it was looking as if mortgage rates might nudge lower today. Or perhaps hold steady. However, the release this afternoon by the Federal Reserve of the minutes of the last meeting of its key policy committee could change everything.

Find and lock a low rate (May 24th, 2021)

Current mortgage and refinance rates 

Find and lock a low rate (May 24th, 2021)

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?

The heady days of the first half of April, when mortgage rates fell consistently, seem to be over, at least for now. Of course, they’ll be back one day. But heaven knows when.

To me, it seems more likely that rises will outweigh falls for some time to come. Perhaps, even, for the rest of this year. But some falls are inevitable.

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 Treasurys held steady at 1.65% (Neutral for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields, though less so recently
• Major stock indexes were lower on opening. (Good 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
• Oil prices fell to $63.26 from $66.11 a barrel. (Good for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity. 
• Gold prices increased to $1,885 from $1,869 an ounce. (Neutral for mortgage rates*.) In general, it’s 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 — fell to 30 from 41 out of 100. (Good for mortgage rates.) “Greedy” investors push bond prices down (and interest rates up) as they leave the bond market and move into stocks, while “fearful” investors do the opposite. So lower readings are better than higher ones

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, so far mortgage rates today look likely to inch lower or hold steady. However, be aware that intraday swings (when rates change direction during the day) are a common feature right now.

Find and lock a low rate (May 24th, 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. But some types of refinances are higher following a regulatory change

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

A fear of future inflation has been a feature of markets in recent weeks. And it’s been largely behind the modest rises in mortgage rates we’ve seen during that time.

But those rates won’t have been helped by a blistering attack earlier this week on the Federal Reserve’s current policies by economist Larry Summers. Mr. Summers was President Barack Obama’s chief economics adviser and had been treasury secretary under President Bill Clinton.

Mr. Summers accused the Fed of creating “dangerous complacency” in markets through its policy of focusing on job creation and allowing inflation to run more warmly than usual. He warned of the “real damage” that might result.

The Fed is continuing to hold its interest rates at exceptional lows. And, for some time, it’s been buying assets (including mortgage-backed securities) at a rate of $120 billion each month, according to MarketWatch. That’s been helping to keep mortgage rates artificially low.

If Mr. Summers is right, and the Fed’s forced to change course earlier than expected, we might see significantly higher mortgage rates quite soon. But, even if he’s wrong, we might see somewhat higher mortgage rates. All it takes is enough investors to believe him.

Mortgage rates and inflation: Why are rates going up?

For more background, check out our latest weekend edition of this report.

Recently

Over much of 2020, the overall trend for mortgage rates was clearly downward. And a new, weekly all-time low was set on 16 occasions last year, according to Freddie Mac.

The most recent weekly record low occurred on Jan. 7, when it stood at 2.65% for 30-year fixed-rate mortgages. But then the trend reversed and rates rose.

However, those rises were mostly replaced by falls in April, though those have moderated since the middle of that month. Freddie’s May 13 report puts that weekly average at 2.94% (with 0.7 fees and points), down from the previous week’s 2.96%. But note that Freddie’s methodology means it will have largely missed the major rises that week. And, in fact, rates were appreciably higher by last Thursday’s publication day.

Expert mortgage rate forecasts: Updated today

Looking further ahead, Fannie Mae, Freddie Mac and the Mortgage Bankers Association (MBA) each has a team of economists dedicated to monitoring and forecasting what will happen to the economy, the housing sector and mortgage rates.

And here are their current rates forecasts for the remaining quarters of 2021 (Q2/21, Q3/21, Q4/21) and the first quarter of 2022 (Q1/22).

The numbers in the table below are for 30-year, fixed-rate mortgages. Freddie’s were updated on April 14, Fannie’s on May 19 and the MBA’s on April 22.

Forecaster	Q2/21	Q3/21	Q4/21	Q1/22
Fannie Mae	3.0%	3.1%	3.2%	3.3%
Freddie Mac	3.2%	3.3%	3.4%	3.5%
MBA	3.4%	3.6%	3.7%	3.9%

However, given so many unknowables, the current crop of forecasts might be even more speculative than usual.

Find your lowest rate today

Some lenders have been spooked by the pandemic. And they’re restricting their offerings to just the most vanilla-flavored mortgages and refinances.

But others remain brave. And you can still probably find the cash-out refinance, investment mortgage or jumbo loan you want. You just have to shop around more widely.

But, of course, you should be comparison shopping widely, no matter what sort of mortgage you want. As federal regulator the Consumer Financial Protection Bureau says:

Shopping around for your mortgage has the potential to lead to real savings. It may not sound like much, but saving even a quarter of a point in interest on your mortgage saves you thousands of dollars over the life of your loan.

Verify your new rate (May 24th, 2021)

Mortgage rate methodology