June 10, 2015
Last Friday, mortgage rates hit their highest levels of the year in the wake of strong economic data released that day. Rates for 30-year fixed rate conventional mortgages broke the 4% zone and while there was some improvement on Monday, it wasn’t enough to push best execution rates out of the low fours and back into the upper three percent range.
On Tuesday rates moved back up, but as our sources are reporting this happened without the usual reasons you might see to spur that move–there was no significant economic data or breaking news that may have acted as a catalyst for investor behavior that pushed rates higher, and so we sit in what many are describing as an unpredictable mortgage loan rate environment that could go in either direction over the short term.
Today, 30-year fixed rate conventional mortgages are still in a range of best execution rates between 4.125% and 4.25%. FHA mortgage rates are still in the 3.75% comfort zone but this best execution rate tends to vary more among lenders than 30-year fixed rate conventional mortgage loan rates.
Your experience may vary, and it’s unclear how much more upward pressure mortgage rates will take before FHA mortgage loan interest rates begin creeping back into the four percent zone–something they haven’t done in a while.
Remember, best execution rates are those offered to borrowers with outstanding financial qualifications including high FICO scores and excellent loan repayment history. The availability of a participating lender offering those rates may also be a factor.
For now, industry professionals are advising caution when it comes to locking a mortgage loan rate or “floating” in hopes of better numbers tomorrow or the next day. There are no real indications as to how rates may change tomorrow or the next day in light of today’s upward movement. Are we in an overall rising trend? Or is a “market correction” coming that might push rates lower after some sustained upward momentum? Time will tell, but for now caution seems to be the advice of the day.
Do you have questions about FHA loans? Ask us in the comments section.
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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