Today’s mortgage rates
Average mortgage rates barely moved yesterday, just inching up by the smallest measurable amount. But, overall, they climbed yet again over the last seven days. And it remains a challenging period for borrowers.
I’m hoping that markets might take a breather next week and decide they’ve pushed mortgage rates too high. That could see falls, though probably minor ones. But where they stand one week today will depend on next Thursday’s gross domestic product data and the following day’s inflation report. And they’re wholly unpredictable.
Current mortgage and refinance rates
| Program | Mortgage Rate | APR* | Change |
|---|---|---|---|
| Conventional 30-year fixed | 7.259% | 7.31% | +0.04 |
| Conventional 15-year fixed | 6.702% | 6.782% | +0.05 |
| 30-year fixed FHA | 6.915% | 6.969% | -0.38 |
| 5/1 ARM Conventional | 6.738% | 7.924% | +0.12 |
| Conventional 20-year fixed | 7.08% | 7.136% | +0.05 |
| Conventional 10-year fixed | 6.589% | 6.664% | +0.06 |
| 30-year fixed VA | 7.072% | 7.123% | -0.3 |
| Rates are provided by our partner network, and may not reflect the market. Your rate might be different. Click here for a personalized rate quote. See our rate assumptions See our rate assumptions here. | |||
Should you lock a mortgage rate today?
I still doubt we’ll see a consistent downward trend in mortgage rates for several months. Indeed, we may have to wait until 2025.
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, with so much uncertainty at the moment, your instincts could easily turn out to be as good as mine — or better. So let your gut and your own tolerance for risk help guide you.
What’s moving current mortgage rates
A glimmer of hope?
The Wall Street Journal (paywall) provided a glimmer of hope for mortgage rates on Thursday. Don’t expect a game-changer. But it’s just possible that we could see some minor falls (or less sharp rises) in mortgage rates over the coming months.
Why? Because some investors are growing increasingly nervous about the sustainability of the stock market boom. And they’re shifting “hundreds of billions” out of stocks and into other investments, including bonds.
What’s that got to do with mortgage rates? Well, they’re largely determined by yields on a type of bond called a mortgage-backed security (MBS). If demand for MBSs grows, their prices will rise. And it’s a mathematical inevitability that higher bond prices mean lower bond yields. Lower MBS yields = lower mortgage rates, all other things being equal.
The Journal explained what’s happening:
“Corporate pension funds are shifting money into bonds. State and local government funds are swapping stocks for alternative investments. … Like investors of all kinds, the funds are slowly adapting to a world of yield, where they can get sizable returns on risk-free assets. That is rippling throughout markets, as investors assess how much risk they want to take on. Moving out of stocks could mean surrendering some potential gains. Hold too much, for too long, and prices might fall.”
As I said, don’t get too excited about this glimmer of hope. There remains plenty of upward pressure on mortgage rates. And the downward pressure from a switch to bonds probably won’t wholly offset that. But things may not be quite as bleak if the Journal’s analysis is correct.
Next week’s economic reports
Next week starts slowly for economic reports. The only ones over the Monday-Wednesday period that typically move mortgage rates at all are a couple of purchasing managers’ indexes (PMIs) due on Tuesday. And even they rarely move those rates far or for long.
Things change on Thursday. That day brings the first reading of gross domestic product (GDP) during the first quarter of this year (Q1/24).
Markets are currently expecting GDP growth to slow to 2.2% from 3.4% in the previous quarter. Mortgage rates might fall if Thursday’s actual figure is lower than 2.2% but could rise if it’s higher.
Next Friday’s personal consumption expenditures (PCE) price index for March could move mortgage rates even further. It’s rarely as important as the consumer price index. But it’s the Federal Reserve’s favorite gauge of inflation and could influence policy over cuts to general interest rates later in the year.
Right now, markets are expecting the March index to hold steady at 0.3% for both all items and “core” PCE, which is all items excluding food and energy prices. For year-over-year figures, they’re anticipating a tiny rise for the all-items index and a similarly small fall for the core one.
As always, I’ll brief you on each important report the day before it’s published.
No Fed officials have speaking engagements next week in the run-up to the next two-day meeting of the central bank’s rate-setting committee. That is scheduled to begin on Apr. 30.
Economic reports next week
See above for details about the more important economic reports next week.
In the following list of next week’s reports, only those in bold typically have the potential to affect mortgage rates appreciably. The others probably won’t have much impact unless they contain shockingly good or bad data.
- Monday — Nothing
- Tuesday — April provisional PMIs for the services and manufacturing sectors from S&P. Also, March new home sales
- Wednesday — March durable goods orders
- Thursday — GDP for Q1/24. Also, March figures for pending home sales, U.S. trade balance, and advances wholesale and retail inventories. Plus initial jobless claims during the week ending Apr. 20
- Friday — March PCE price index. Also, PCE personal income and spending figures. Plus the final consumer sentiment index for April.
Chances are, the week will start as a snoozefest and slowly crescendo.
Time to make a move? Let us find the right mortgage for you
Mortgage rates forecast for next week
I’m hoping that mortgage rates will move a little lower next week. But everything depends on Thursday and Friday’s economic reports. If they’re unfriendly, those rates could rise.
How your mortgage interest rate is determined
A bond market generally determines mortgage and refinance rates. It’s the one where trading in mortgage-backed securities takes place.
And that’s highly dependent on the economy. So mortgage rates tend to be high when things are going well and low when the economy’s in trouble. But inflation rates can undermine those tendencies.
Your part
But you play a big part in determining your own mortgage rate in five ways. And you can affect it significantly by:
- Shopping around for your best mortgage rate — They vary widely from lender to lender
- Boosting your credit score — Even a small bump can make a big difference to your rate and payments
- Saving the biggest down payment you can — Lenders like you to have real skin in this game
- Keeping your other borrowing modest — The lower your other monthly commitments, the bigger the mortgage you can afford
- Choosing your mortgage carefully — Are you better off with a conventional, conforming, FHA, VA, USDA, jumbo or another loan?
Time spent getting these ducks in a row can see you winning lower rates.
Remember, they’re not just a mortgage rate
Be sure to count all your forthcoming homeownership costs when you’re working out how big a mortgage you can afford. So, focus on something called you “PITI.” That stands for:
- Principal — Pays down the amount you borrowed
- Interest — The price of borrowing
- Taxes — Specifically property taxes
- Insurance — Specifically homeowners insurance
Our mortgage calculator can help with these.
Depending on your type of mortgage and the size of your down payment, you may have to pay mortgage insurance, too. And that can easily run into three figures every month.
But there are other potential costs. So, you’ll have to pay homeowners association dues if you choose to live somewhere with an HOA. And, wherever you live, you should expect repairs and maintenance costs. There’s no landlord to call when things go wrong!
Finally, you’ll find it hard to forget closing costs. You can see those reflected in the annual percentage rate (APR) that lenders will quote you. Because that effectively spreads them out over your loan’s term, making that rate higher than your straight mortgage rate.
But you may be able to get help with those closing costs and your down payment, especially if you’re a first-time buyer. Read:
Down payment assistance programs in every state for 2023
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 result is a good snapshot of daily rates and how they change over time.