February 16, 2017
Mortgage rates have been moving steadily higher for the last five business days; the most recent move higher on Wednesday was motivated in part by investor reaction to stronger economic data including a stronger Retail Sales report and better news associated with inflation stats.
This data was part of scheduled economic data releases due out this week, and mortgage rates moved higher as they are often wont to do when there is good economic news.
The move higher puts fixed rate conventional mortgage loan rates in a range with 4.375% best execution at the upper end-our sources indicate that more lenders are offering rates at or near the higher end. But the real news involves a change in FHA mortgage loan best execution rates-these numbers have been slower to change and in the last several weeks we’ve seen FHA rates hanging out in a best execution zone at or near 3.75%
With Wednesday’s move higher, FHA mortgage loan rates have broken into a best execution range with 4.25% at the upper end. This is the first time in a while that FHA best execution interest rate numbers have risen into the four percent range; that’s a significant move in the short term.
Will it last?
It’s hard to say-if there is sustained upward pressure on interest rates, FHA mortgage loan rates could establish a new, higher comfort zone. But if the most recent days upward momentum is broken or there is some form of correction along the way, it’s possible that under the right conditions we could see a return to the best execution 3.75% we’ve seen for weeks.
But that is speculation at this point and borrowers who have not made mortgage rate commitments with the lender should not assume rates will return to a lower point in the short term.
FHA rates commonly take longer to change than their conventional mortgage counterparts, but FHA loan interest rates also tend to vary more among participating lenders. And it’s good to keep in mind that the rates we list here are best execution rates, which assume ideal conditions including outstanding credit reports, high FICO scores and other financial qualifications. Your experience may vary; the rates seen here are not available to all borrowers or from all lenders.
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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