April 13, 2017
Mortgage rate trends this week have been dragging rates to their lowest levels of the year.
Around election time last year, we began to see the stage being set for some upward trending that pushed mortgage loan interest rates out of their three percent ranges and back into four percent territory. At one point it seemed likely that the mid-fours could be the range for the new year.
But now, at least in the short term, we are seeing rates creep back down, closer to where they were pre-election (assuming the downward trend persists). There are several reasons for this, including bond market activity, geopolitics, and most recently a reaction to statements from the White House that the dollar is performing too robustly (paraphrasing ours).
To learn more about what happened to mortgage rates after the 2016 election, read this report by CNN Money published in November of 2016.
So at the time of this writing, we are seeing mortgage loan rate activity (best execution) at the very bottom of the four percent range for 30-year fixed rate conventional mortgages. Our sources state that 4.0% is a common best execution rate, with less competitive lenders offering best execution rates at or near 4.125%.
FHA mortgage loan rates are now out of a range and back solidly at 3.75% best execution. FHA rates tend to vary more among participating lenders than their conventional counterparts, so it never hurts to shop among lenders to find the lowest rates.
Some market watchers say now is not a bad time to consider floating, or holding off on a mortgage rate lock with your lender in hopes that the rates will continue to drop. However, floating is not without risk, and the gamble you take on floating in the current rate environment includes the risk that tomorrow’s headlines will undo everything that was done to lower rates with the previous day’s news. Float at your own risk and for best results, decide how high rates will go before you cut your losses and make the commitment.
As always the rates you see listed here are published as “best execution” rates, which assume ideal conditions including a well-qualified borrower. Your FICO scores and other financial information will play a big part in determining the interest rate the lender offers you. Best execution rates as listed here may not be available from all lenders or to all borrowers. Your experience may vary.
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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