October 31, 2016
Since our last report, rates have remained in an upward trend, but Friday saw a bit of relief after a spike on Thursday. Mortgage rates have been moving upward, hitting their highest levels in many months, but they are still below four percent even with the current trend.
Some market watchers blame bond market weakness for at least part of this upward trend, but there have been important economic developments abroad (Many have been keeping watch on European Central Bank news) and at home (scheduled economic data releases and news from the Fed) that have also contributed to the current rate environment.
Friday rates recovered a bit, reflected in closing costs for many rather than an actual change in the best-execution rates reported here. 30-year fixed rate conventional mortgages are still, best execution, at or near 3.625%.
FHA mortgage loan rates stayed in their comfort zone (best execution) between 3.25% and 3.5%. If rates continue an upward trend we could see this range move into a single, higher rate. Or if the next shift in rates is dramatic enough, we could watch rates move into a new range.
FHA rates tend to vary more among participating lenders. You may have to shop around to find the most competitive mortgage rates. The numbers you see listed here assume ideal conditions including a well-qualified borrower with outstanding FICO scores and loan repayment history. Your experience may vary. The rates seen here are not available to all borrowers or from all lenders.
This week has a LOT of important economic activity with the potential to influence mortgage rates. There’s an inflation report due out Monday, Fed will meet mid-week, and the Employment Situation Report comes out on Friday. All of these have potential to influence mortgage loan interest rates depending on how investors react to the information released or announcements made.
If you are unsure whether to lock or float this week, have a conversation about the timing of your your mortgage rate commitment with your loan officer to get some advice. This may be a tricky week, so making an informed choice on locking or floating is definitely a good idea.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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