Today’s mortgage and refinance rates
The average mortgage rate fell quite a bit yesterday. It was the fourth straight business day of decline. And they are now very low; not a million miles from the all-time low.
And they may not be finished yet. Because, judging by the initial activity in key markets, the downturn may slow rather than stop. And today’s mortgage rates seem to be slightly lower. But, overnight, the market showed small gains so things are far from stable and could change over time.
Find and lock low rates (July 21, 2021)
Current mortgage and refinance rates
Find and lock low rates (July 21, 2021)
COVID-19 mortgage update: Mortgage lenders are changing rates and rules due to COVID-19. To see the latest information on how the coronavirus could affect your home loan, click here.
Should you lock a mortgage rate today?
Read on for reasons why today’s mortgage rates are so unpredictable. Unfortunately, that makes locking and floating risky.
Those of us who have predicted higher mortgage rates (almost all experts and observers) so far have been comprehensively proven wrong. But the fact that we misread the timing doesn’t mean they won’t be on their way soon. And, as long as the forces that should be pushing this level higher remain strong, I must stick to my old views. However, I am less confident than I used to be.
So, even if it has to be interpreted in that context, my personal rate key recommendation should still be:
However, I do not claim perfect foresight. And your personal analysis could be as good as mine — or better. So you may choose to be guided by your instincts and your personal tolerance for risk.
Market data affecting today’s mortgage rates
The following is a snippet of the state of the game this morning at around 09.50 WIB. The data, compared to almost the same time yesterday, are:
*A change of less than $20 in gold prices or 40 cents in oil prices is a fraction of 1%. So we count only meaningful differences as good or bad for mortgage rates.
Caveats about markets and rates
Before the pandemic and the Federal Reserve’s intervention in the mortgage market, you could look at the numbers above and make a pretty good guess as to what would happen to mortgage interest rates that day. But that’s no longer the case. We still make daily calls. And usually true. But our accuracy record won’t reach its previous high level until things are settled.
So use the market only as a rough guide. Because they have to be very strong or weak to rely on them. But, with that caveat in mind, so far today’s mortgage rates seem to be dropping moderately. But be aware that “intraday swings” (when prices change direction during the day) are a common feature these days.
Find and lock low rates (July 21, 2021)
Important notes on today’s mortgage rates
Here are some things you need to know:
So there’s a lot going on here. And no one can claim to know for sure what will happen to mortgage rates in the coming hours, days, weeks, or months.
Are mortgage and refinance rates rising or falling?
Today and soon
The market movement over the last few business days has been very sharp. A week ago, the yield on the 10-year Treasury bond (which is often overshadowed by mortgage rates) closed at 1.42%. But, yesterday evening, they closed at 1.21%. And this morning, they stood at 1.15%. That is a big difference.
You can think of the fall as a pure emotion: that is, fear. Now, there is good reason for some fear over the potential damage COVID-19 could inflict on the global economy. But, if some new medical statistic or economic figures trigger the recent declines in Treasury yields, mortgage rates, and stocks, it’s one that passes me by. Jim Reid of Deutsche Bank seems to agree, according to the Guardian this morning:
Unlike some previous Covid-related sell-offs (or vaccine demonstrations indeed), there doesn’t seem to be a single trigger point behind yesterday’s rout, which instead appears to be the culmination of growing concerns that a return to ‘normality’ could be on the way. a little further than many would have expected a few months ago.
So, it looks like investors are suddenly freaking out at the risks that have been seen for months. And, despite the myth of the perfect market, they are just as vulnerable to herd behavior as consumers are when they frantically buy toilet paper.
The problem is that such an emotion-driven herd mentality is inherently fickle and unpredictable. Already, it looks like mortgage rates will fall much more slowly these days. And I can’t make a call as to whether they will bounce back any further in the coming days (or weeks or months) or drop again. I doubt anyone can, let alone those in the herd.
Read Saturday’s weekend issue, for more background.
Mortgage rates and inflation: Why are rates rising?
During most of 2020, the overall trend for mortgage rates is clearly declining. And new weekly all-time lows were set on 16 occasions last year, according to Freddie Mac.
The latest weekly record low was on January 7, when it stood at 2.65% for a 30-year fixed rate mortgage. But then the trend reversed and the price went up.
However, those gains were largely replaced by declines in April and since then, albeit only slightly. Freddie’s July 15 report puts the weekly average at 2.88% (with 0.7 costs and points), down from 2.90% the previous week. And they are likely to be even lower on Thursday’s release.
Expert mortgage rate forecasts
Looking further ahead, Fannie Mae, Freddie Mac and the Mortgage Bankers Association (MBA) each have a team of economists dedicated to monitoring and forecasting what will happen to the economy, housing sector, and mortgage rates.
And here are their current rate estimates for the remaining quarters of 2021 (Q3/21 and Q4/21) and the first two quarters of 2022 (Q1/22 and Q2/22).
The figures in the table below are for a 30 year fixed rate mortgage. Fannie’s renewed on July 19, Freddie on July 15 and MBA on June 18.
However, given so much remains unknown, current estimates may be more speculative than usual.
Find your lowest rate today
Some lenders have been spooked by the pandemic. And they limit their offerings to only the most vanilla-flavoured mortgages and refinances.
But others are still brave. And you may still be able to find the cash-out refinance, investment mortgage or jumbo loan you want. You just need to go around wider.
But, of course, you should compare spending broadly, no matter what type of mortgage you want. As a federal regulator, the Bureau of Consumer Financial Protection says:
Shopping for your mortgage has the potential to generate real savings. This may not sound like much, but saving even a quarter of a point in your mortgage interest saves you thousands of dollars over the life of your loan.
Verify your new rate (July 21, 2021)
Mortgage rate methodology
Mortgage Reports receive rates based on criteria selected from multiple lending partners on a daily basis. We arrive at the average rate and APR for each loan type to display on our chart. Because we average a series of rates, this gives you a better idea of what you might find in the market. In addition, we provide an average rate for the same type of loan. For example, FHA fixed with fixed FHA. The end result is a good overview of the daily rates and how they change over time.
What did refinance rates do today?
|Fixed Rate 30 Years||2.990%||3.160%|
|Fixed Rate 20 Years||2.850%||3.030%|
|Fixed Rate 15 Years||2.320%||2.550%|
|10/1 ARM Level||3.720%||4.150%|
Did mortgage interest rates drop today?
Mortgage refinancing rate today is moving lower – July 15, 2021 The 30-year average refinancing rate is 3.10 percent, down 4 basis points from a week ago. The 15-year fixed average refi rate is now 2.43 percent, down 1 basis point since the same time last week.
What is the lowest mortgage rate ever?
The trend of mortgage interest rates continued to decline until interest rates fell to 3.31% in November 2012 — the lowest level in the history of mortgage rates.
What was the lowest mortgage rate in 2020?
Mortgage rates in 2020 have fallen as the Federal Reserve lowered interest rates in response to COVID-19. As of this writing in November 2020, the average 30-year fixed rate mortgage with a 20% down payment has just hit a new record low of 2.72% according to Freddie Mac.
Will mortgage rates keep dropping?
Unfortunately, it is unlikely that mortgage rates will continue to decline in 2021. … â€œHouse prices are expected to continue to rise due to demographic factors, low interest rates, and a strong economy creating demand pressures. Homebuyers waiting to face the double challenge of higher house prices in tandem with higher inflation.
What happens when interest rates go to zero?
Despite low returns, near-zero interest rates lower borrowing costs, which can help spur spending on business capital, investment, and household spending. … Banks with little capital to lend were particularly hard hit by the financial crisis. Low interest rates can also drive up asset prices.
What causes mortgage rates to drop?
If there were fewer homes on the market, there would be fewer people applying for mortgages. This causes mortgage interest rates to fall. Similarly, if there are more people renting vs. people who buy houses, it also results in a decrease in demand, which means a decrease in mortgage rates.
Can mortgage rates go to 2%?
Most market pundits think the unlikely rate will remain at 2% for the rest of the year. … Assuming the economy continues to improve, the Fed may end its current rate-cutting program. Fed decisions affect mortgage rates and mortgage lenders. And mortgage rates may rise slightly because of inflation fears.