Today’s mortgage and refinance rates 

Average mortgage rates held steady yesterday. So they remain extraordinarily low.

It’s looking as if mortgage rates today may nudge upward. This morning’s retail sales figures for August were better than expected, “a sign of the economic recovery’s resilience despite the Delta variant,” according to The Wall Street Journal.

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?

There are two reasons why I’d lock my mortgage rate soon if I were you. First, these rates have been going nowhere for weeks. So there’s little advantage in floating. And, secondly, it’s more likely that they’ll rise rather than fall when they do eventually move, which they must do at some time.

Of course, nobody can see into the future. And it’s always possible rates could yet fall. But that seems less likely than their rising.

So, for now, my personal rate lock recommendations remain:

• LOCK if closing in 7 days
• LOCK if closing in 15 days
• LOCK if closing in 30 days
• FLOAT if closing in 45 days
• FLOAT 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 jumped to 1.35% from 1.29%. (Bad for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields
• Major stock indexes were mixed shortly after opening. (Neutral 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 $72.08 from $72.57 a barrel. (Good for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity. 
• Gold prices tumbled to $1,754 from $1,799 an ounce. (Bad 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 — climbed to 41 from 32 out of 100. (Bad 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 rise, probably moderately. 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 (Sep 17th, 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

Nothing much is moving mortgage rates at the moment. True, we’re seeing a bit of movement this morning. And there’s an outside chance that they’ll begin to move on Sept. 22. But they’re more likely to continue to be near-comatose, perhaps for weeks or even months.

Of course, they’ll move eventually. And if you want to see the different pressures that might push them higher — or just possibly lower — read yesterday’s column.

Why have they been shrugging off good and bad economic data and remaining flat? There are probably two main reasons:

1. The Federal Reserve is buying huge quantities of mortgage-backed securities (MBSs, the type of bond that largely determines mortgage rates) and is distorting the market
2. Bank deposits are currently much higher than demand for loans. So regular banks, too, are parking some of their spare money in MBSs, which also distorts the market

Neither of these sources of extra demand for MBSs is particularly sensitive to day-to-day economic data. For the Fed, it’s part of its easy-money policy. And for banks it’s a “distress purchase”: they’ve nowhere better to put their excess cash.

But, together, they’re keeping mortgage rates artificially low. We’ll get onto just how low next …

How low are current mortgage rates?

The first time average rates for 30-year, fixed-rate mortgages (FRMs) dipped below 3% was a year ago, in August 2020, according to Freddie Mac’s monthly archives. And when I say the first time, I mean it. It’s the first time since Freddie began tracking these rates, 50 years ago. And that’s effectively forever, in terms of modern mortgages.

Just how extraordinarily low a sub-3% rate is can be seen by scrolling back to earlier decades. Before the 2008 credit crunch, average annual rates for 30-year FRMs in the 2000s began with a 5 or a 6 — and one 8. In the 1990s, they ranged from 6%+ to 10%+. And in the 1980s, rates began with 10s, 12s, 13s and 16s. No really! In 1981, the annual average was 16.63% and in 1992 it was 16.04%.

So I’m not using hyperbole when I call today’s mortgage rates extraordinarily low or uberlow. They really are at levels that were undreamed of in previous years and decades. And, for homebuyers and refinancers, they may be a unique window of opportunity that’s probably set to close.

For more background, read Saturday’s weekend edition of this column.

Recently — Updated today

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, in April and after, those rises were mostly replaced by falls, though typically small ones. And, more recently, rates have hardly budged. Freddie’s Sept. 16 report puts that weekly average at 2.86% (with 0.7 fees and points), down from the previous week’s 2.88%.

Expert mortgage rate forecasts

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 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. Fannie’s and the MBA’s were updated on Aug. 19. But Freddie’s were last refreshed on July 15 because it now publishes these figures only quarterly. And its forecast is already looking stale.

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

All these forecasts expect higher mortgage rates soon. But the differences between the forecasters are stark. And it may be that Fannie isn’t building in the Federal Reserve’s tapering of its support for mortgage rates while Freddie and the MBA are.

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 (Sep 17th, 2021)

Mortgage rate methodology