Mortgage Rate Volatility Remains Quiet, Almost Too Quiet...

By: Matthew Graham •

Mortgage Rates are essentially flat today despite the day containing similar levels of economic data and European-inspired volatility in the wee hours of the morning.  If anything, rate sheets are ever-so-slightly improved, but you'll likely only see improvements in closing costs, especially if you saw a drop in rate yesterday.

Today's BEST-EXECUTION Rates

  • 30YR FIXED -   More centered on 4.0% again, but still plenty 4.125%
  • FHA/VA - 3.75- 3.875%, leaning back toward 3.75% today
  • 15 YEAR FIXED -  3.375%-3.5%
  • 5 YEAR ARMS -  low 3% range, huge variations from lender to lender.

Guidance: As per the batting cage metaphor, today makes two decent pitches in a row.  Plus, not only do things FEEL eerily quiet in terms of market movements, but even the charts are indicating that, in the longer run, markets could be ready to move in one direction or another fairly big, fairly soon.  If you have inside knowledge that stocks will crash and bonds will move lower in yield, continuing to float for another eighth or two of improvement could make sense.  If, on the other hand, you're like the markets in the sense you're not sure which way things will go, we'd probably take this opportunity with best-execution rates within .25% of their all-time lows to gracefully lock and move on.

 See Rates from Lenders in Your Area

The pitching machine/batting cage: Rate offerings from lenders over the past month have been like a temperamental pitching machine in a batting cage-generally getting the ball across the plate, but with no really juicy pitches.  But recently, we've seen some more consistently good pitches (best-ex around 4.0% instead of 4.25%).  Sure... you've seen better, but not by much (3.875% and RARELY 3.75%).  How many more will you count on before calling it a day?  Personally, I'd like to end my batting cage session with a nice hit.  The more "pitches" you wait for with rates already at a 4.0%, the greater the risk that the next pitch will be a curveball.  To drop the metaphor, although rates this low CAN go slightly lower, the improvements are fairly minimal compared to how much higher they could go.  Still, if you're not in any particular need to refinance and are operating on a longer-term perspective, we continue to feel good about that "wall" at a 4.25% best-execution level as a good stop-loss point for inclined floaters.  Ask us to explain more about that if it doesn't make sense.