Today’s mortgage and refinance rates 

Average mortgage rates nudged down again yesterday. And they’re now within touching distance of the all-time low.

First thing this morning, it was looking as if mortgage rates today might hold steady or just edge either side of the neutral line. But that could change as the hours pass.

Find and lock a low rate (Aug 3rd, 2021)

Current mortgage and refinance rates 

Find and lock a low rate (Aug 3rd, 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?

Average mortgage rates have risen just twice since July 14, according to Mortgage News Daily’s (MND’s) figures. And neither of those increases was significant.

MND yesterday put the average rate for a 30-year, fixed-rate mortgage at 2.8%. And its all-time low is currently 2.75%. You can almost feel that record low’s hot breath. Note that MND and Freddie Mac use different methodologies for their surveys and so have slightly different numbers. But both are likely to show similarly uberlow rates.

But take care if you do continue to float. Just about all mortgage experts believe higher rates are on their way. And you need to be ready to float as soon as the tide turns.

My personal rate lock recommendations are:

• LOCK if closing in 7 days
• LOCK if closing in 15 days
• FLOAT 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 fell to 1.16% from 1.21%. (Good 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 mostly slightly higher shortly 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
• Oil prices tumbled to $69.64 from $73.10 a barrel. (Good for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity. 
• Gold prices inched up to $1,816 from $1,812 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 — edged lower to 27 from 31 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 remain unchanged or barely changed. 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 (Aug 3rd, 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

If you read yesterday’s edition of this daily column, you’ll know that I remain convinced that mortgage rates will rise soon. And it’s possible that rise will be sharp.

But, for now, they’re falling. So what’s happening?

Well, the narrative in the financial media is that it’s mostly about COVID-19. CNBC reported yesterday:

The spread of the delta coronavirus variant continued to keep investors on edge. The seven-day average of daily coronavirus cases in the U.S. reached 72,790 on Friday, surpassing the peak seen last summer when the nation didn’t have an authorized COVID-19 vaccine, according to data compiled by the Centers for Disease Control and Prevention.

— CNBC, “Stock futures rise slightly after a losing day,” Aug. 2, 2021

But the news is actually good

It’s true that infection rates are rising. But yesterday also saw the vaccination rate meet the president’s target of 70%. And, while hospitalizations and deaths are also moving higher, their raw numbers remain way below their height during the pre-vaccination era. The vaccines are working at preventing serious illness — among the vaccinated.

And that CNBC article made clear that some investors are more freaked out than others by this new COVID-19 wave. It quoted UBS’s chief investment officer for the Americas, Solita Marcelli:

The delta variant of the virus is now rapidly spreading in the U.S. and a modest pullback in [economic] activity can’t be ruled out. But any potential slowdown should be somewhat muted.

If Ms. Marcelli is correct, the current economic boom is likely to continue, if, perhaps, at a slightly slower pace. Still, this year, we remain likely to see the fastest growth in America’s gross domestic product (GDP) in several decades. And mortgage rates pretty much always rise when the economy is doing well.

Of course, there are other threats to the economic recovery. Perhaps the most likely is the possible emergence of a new, vaccine-resistant variant of SARS-CoV-2, the virus that causes COVID-19. But that’s just a remote possibility.

And I remain mystified — along with many others — why bond markets (one of which directly determines mortgage rates) are acting as if we’re in the middle of a recession while we’re actually experiencing a boom.

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

Mortgage rates and inflation: Why are rates going up?

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 since April, though typically small ones. Freddie’s July 29 report puts that weekly average at 2.8% (with 0.7 fees and points), up from the previous week’s 2.78%.

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 were updated on July 19, Freddie’s on July 15 and the MBA’s on July 21.

Forecaster	Q3/21	Q4/21	Q1/22	Q2/22
Fannie Mae	3.0%	3.1%	3.2%	3.2%
Freddie Mac	3.3%	3.4%	3.5%	3.6%
MBA	3.2%	3.4%	3.8%	4.0%

However, given so many unknowables, the 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 (Aug 3rd, 2021)

Mortgage rate methodology