Mortgage and refinance ra...

Today’s mortgage and refinance rates

Average mortgage rates inched higher yesterday. But the increase was so tiny that many lenders may not change their rates and instead add a small amount to closing costs.

Early movements in markets this morning suggest mortgage rates today might be unchanged or barely changed. But these are uncertain times and you can’t rely on things turning out that way.

Should you lock a mortgage rate today?

Don't lock on a day when mortgage rates look set to fall. My recommendations (below) are intended to give longer–term suggestions about the overall direction of those rates. So, they don’t change daily to reflect fleeting sentiments in volatile markets.

Regular readers will know that I’m pessimistic about these rates’ overall direction. Yes, there will be periods of falls. But I’m expecting increases to outweigh decreases by some margin for months to come.

So, my personal rate lock recommendations for the longer term remain:

>Related: 7 Tips to get the best refinance rate

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:

*A change of less than $20 on gold prices or 40 cents on oil ones is a fraction of 1%. So we only count meaningful differences as good or bad for mortgage 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 might hold steady or close to steady. However, be aware that “intraday swings” (when rates change direction during the day) are a common feature right now.

Important notes on today’s mortgage rates

Here are some things you need to know:

A lot is going on at the moment. And nobody can claim to know with certainty what will happen to mortgage rates in coming hours, days, weeks or months.

Are mortgage and refinance rates rising or falling?

Mortgage and refinance rates have been rising quickly over recent months. I’m hoping that the pace of change might slow. But I’m not expecting any sharp and sustained falls anytime soon, absent earth–shattering events.

Yesterday, CNN ran the headline, “Mortgage rates rise above 4% for the first time since 2019.” The Wall Street Journal (paywall) and The New York Times (paywall) carried the same story, as did countless other news outlets.

But if you’ve been following rates on this website, you’ll know that mortgage rates have been almost always above 4% for many weeks. So who’s lying?

Well, nobody. But news outlets mostly rely for their mortgage rates coverage on Freddie Mac’s weekly bulletin. And that can often be misleading.

To start with, Freddie makes the groundless assumption that you’re going to purchase discount points. These points mean you pay more than necessary on closing in order to buy yourself a lower mortgage rate.

That can be a smart move. And plenty of people do it. But many don’t. And you might feel that publishing artificially low rates that aren’t available to everyone is unhelpful. Take those points out of the equation and Freddie’s rates are much closer to the ones we and others publish daily.

There’s another glitch in Freddie’s methodology that can make its reports each Thursday less than accurate. It collects most of the data it uses on the previous Monday. So, any changes on Tuesdays and Wednesdays in any given week are largely lost.

Freddie is great at tracking rates over a long period. But take its weekly bulletins as neither gospel nor necessarily up to date.

Still, Freddie’s chief economist got things right, in my view, yesterday when he remarked:

The Federal Reserve raising short–term rates and signaling further increases means mortgage rates should continue to rise over the course of the year.

Read the weekend edition of this daily article, published last Saturday, for more background.

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 that year, according to Freddie Mac.

The most recent weekly record low occurred on Jan. 7, 2021, when it stood at 2.65% for 30–year fixed–rate mortgages.

Since then, the picture has been mixed with extended periods of rises and falls. Unfortunately, the rises have grown more pronounced since last September, though not consistently so.

Freddie’s March 17 report puts that weekly average for 30–year, fixed–rate mortgages at 4.16% (with 0.8 fees and points), up from the previous week’s 3.85%.

Note that Freddie expects you to buy discount points (“with 0.8 fees and points”) on closing that earn you a lower rate. If you don’t do that, your rate would be closer to the ones we and others quote.

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 four quarters of 2022 (Q1/22, Q2/22, Q3/22, Q4/22).

The numbers in the table below are for 30–year, fixed–rate mortgages. Fannie’s were published on March 17 and the MBA’s on Feb. 25. But Freddie now publishes these forecasts every quarter, most recently on Jan. 21. So its figures are already looking very stale.

Note that the MBA’s figures were issued before Russia invaded Ukraine. Of course, given so many unknowables, the whole current crop of forecasts may be even more speculative than usual.

But I still don’t understand why Fannie remains convinced that mortgage rates will rise only modestly. Just for it to be correct about the current quarter, which has only a short time left to run, those rates would have to plunge to extraordinary lows. And I just don’t see its grounds for expecting that.

Find your lowest rate today

You should comparison shop 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.”

Mortgage rate methodology

The Mortgage Reports receives rates based on selected criteria from multiple lending partners each day. We arrive at an average rate and APR for each loan type to display in our chart. Because we average an array of rates, it gives you a better idea of what you might find in the marketplace. Furthermore, we average rates for the same loan types. For example, FHA fixed with FHA fixed. The end result is a good snapshot of daily rates and how they change over time.