Mortgage and refinancing rate today, April 6
Today’s Mortgage and Refinance Rates
Average mortgage rates edged down yesterday. This surprised me because it seemed that morning that a small increase was more likely. But these small variations make little difference. This is because your lender may not have bothered to change your rate.
Judging by the market movements this morning, mortgage rates could drop moderately today.
Current mortgage and refinancing rates
COVID-19 Mortgage Updates: Mortgage lenders change rates and rules due to COVID-19. To see the latest news on the impact of the coronavirus on your home loan, Click here.
Should you lock in a mortgage rate today?
The lull in mortgage rate hikes continues. Indeed, if you choose the data, you can argue that we are in a period of falls. But, if you look back over a significant period (a month, say, or more), the uptrend is undeniable.
Of course, I cannot guarantee that this uptrend does not reverse. Nor that there will be no bigger falls to come. But that seems unlikely to me.
My personal rate foreclosure recommendations therefore remain:
- LOCK if the closure 7 days
- LOCK if the closure 15 days
- LOCK if the closure 30 days
- LOCK if the closure 45 days
- LOCK if the closure 60 days
But I don’t pretend to have perfect foresight. And your personal analysis could turn out as good as mine, if not better. You can therefore choose to be guided by your instincts and your personal risk tolerance.
Market data affecting today’s mortgage rates
Here’s a look at the state of play this morning around 9:50 a.m. (ET). The data, compared to around the same time yesterday, was as follows:
- The 10-year Treasury bill yield fell to 1.68% from 1.74% (Good for mortgage rates.) More than any other market, mortgage rates normally tend to track these particular yields on Treasury bonds, although less recently.
- Main stock market indices were mostly inferior at the opening. (Good for mortgage rates.) When investors buy stocks, they often sell bonds, which lowers bond prices and increases yields and mortgage rates. The reverse happens when the indices are lower
- Oil price rose from $ 59.98 per barrel to $ 60.20. (Neutral for mortgage rates *.) Energy prices play a big role in creating inflation and also indicate future economic activity.)
- Gold price rose to $ 1,740 from $ 1,725 an ounce. (Neutral for mortgage rates*.) In general, it’s better for rates when gold goes up, and worse when gold goes down. Gold tends to rise when investors worry about the economy. And worried investors tend to cut rates
- CNN Corporate Fear and Greed Index – Bordered up to 64 62 out of 100. (Bad for mortgage rates.) “Greedy” investors push bond prices down (and interest rates up) when they exit the bond market and move into stocks, while “fearful” investors do the opposite. So lower readings are better than higher ones
* A change of less than $ 20 in gold prices or 40 cents in oil prices is a fraction of 1%. We therefore only count significant differences as good or bad for mortgage rates.
Warnings about markets and rates
Before the pandemic and the Federal Reserve’s interventions in the mortgage market, you could look at the numbers above and make a pretty good guess at what would happen to mortgage rates that day. But this is no longer the case. We still make daily calls. And are generally right. But our accuracy record won’t hit its former high levels until things calm down.
Therefore, only use the markets as a guide. Because they have to be exceptionally strong or weak to lean on them. But, with that caveat, so far mortgage rates now seem likely to fall moderately. Just be aware that intraday fluctuations (when rates change direction during the day) are a common feature at this time.
Important Notes on Today’s Mortgage Rates
Here are some things you should know:
- Typically, mortgage rates rise when the economy is doing well and fall when it is struggling. But there are exceptions. Read ‘How mortgage rates are determined and why you should care‘
- Only “$ 2op-tier” borrowers (with exceptional credit scores, large down payments and very healthy finances) get the ultra low mortgage rates you’ll see advertised.
- Lenders vary. Yours may or may not follow the crowd when it comes to daily rate movements – although they generally all follow the larger trend over time.
- When daily rate changes are small, some lenders adjust closing costs and leave their fee schedules unchanged.
- Refinancing rates are generally close to those for purchases. But some types of refinancing are higher following a regulatory change
So there is a lot going on here. And no one can claim to know for sure what will happen to mortgage rates in the hours, days, weeks or months to come.
Are mortgage and refinancing rates going up or down?
Some markets reacted to the exceptionally strong Good Friday employment report yesterday. And some stock indexes have reached record highs. But bond markets (including the one that sets most mortgage rates) generally haven’t.
Why not? Well, maybe that’s because bond investors are keeping their powder dry before two looming news items. First, the publication of job postings and workforce turnover (JOLT) for February later this morning. And, second, tomorrow afternoon the Federal Reserve will release the minutes of its last key policy meeting. Bond markets are particularly sensitive to this type of information. Alternatively, Investopedia today suggested this in the e-newsletter The Express:
Yields on US Treasury bonds continue to decline from recent highs, despite further signs of economic growth. The 10-year U.S. Treasury yield stands at 1.70%, down from 1.77% last week, as investors are caught between looking at the stock market, which continues to hit new highs, and the relative safety of the Treasury market, where yields are slim.
Meanwhile, my personal outlook for the future includes further mortgage rate hikes. That’s because I agree with CNBC’s analysis from yesterday:
Economists expect growth of more than 9% in the second quarter, and monthly jobs reports are expected to show very strong hires, with average job growth of more than a million new wages in the during each of the next few months.
– CNBC, “Fed could be criticized for easy policy as economy skyrockets and inflation rises”, April 5, 2021
Historically, a booming economy and higher inflation almost invariably results in higher interest rates, including mortgage rates.
For more information on my broader thinking, read our latest weekend edition, which is published every Saturday shortly after 10 a.m. (ET).
Through much of 2020, the overall trend for mortgage rates was clearly downward. And a new all-time low was set 16 times last year, according to Freddie Mac.
The most recent weekly record low occurred on January 7, when it stood at 2.65% for 30-year fixed-rate mortgages. But then the trend reversed and rates went up. And Freddie’s April 1 report puts that weekly average at 3.18% (with 0.7 fees and points), up from 3.17% the week before.
Expert mortgage rate forecasts
In the longer term, Fannie Mae, Freddie Mac and the Mortgage Bankers Association (MBA) each have a team of economists dedicated to monitoring and forecasting developments in the economy, the real estate sector and mortgage rates. .
And here are their current rate forecasts for the remaining quarters of 2021 (Q2 / 21, Q3 / 21, Q4 / 21) and the first quarter of 2022 (Q1 / 22).
The figures in the table below are for 30 year fixed rate mortgages. The Fannies were updated on March 17 and the MBAs on March 22. But Freddie now publishes quarterly forecasts. Its figures date from January 10 and seem clearly out of date:
|Forecaster||T2 / 21||Q3 / 21||T4 / 21||T1 / 22|
|Freddie mac||3.0%||3.0%||3.0%||N / A|
However, given so many unknowables, the current crop of forecasts could be even more speculative than usual. And there is certainly a widening of the gap as the year progresses.
Find your lowest rate today
Some lenders have been frightened by the pandemic. And they limit their offers to the more vanilla mortgages and refinances.
But others remain courageous. And you can probably still find the refinance, investment mortgage, or jumbo loan you want. Just shop more widely.
But, of course, you should be doing a lot of comparisons regardless of what type of mortgage you want. As a federal regulator, the Consumer Financial Protection Bureau said:
Shopping around for your mortgage can save you money. It may not seem like much, but saving even a quarter of a point of interest on your mortgage saves you thousands of dollars over the life of your loan.
Mortgage rate methodology
Mortgage reports receive rates based on selected criteria from several lending partners every day. We arrive at an average rate and an APR for each type of loan to display in our graph. Because we average a range of rates, it gives you a better idea of what you might find in the market. In addition, we average the rates for the same types of loans. For example, fixed FHA with fixed FHA. The end result is a good overview of the daily rates and how they have changed over time.
The information contained on The Mortgage Reports website is provided for informational purposes only and does not constitute an advertisement for any products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, its parent company or its affiliates.