August 3, 2016
Mortgage loan rates pushed slightly higher on Tuesday, thanks in part to bond market activity. There are also scheduled economic data releases this week that have the power to move mortgage loan rates depending on investor reaction to the data in those reports. Market watchers aren’t optimistic that lower rates are coming in the short term, while pointing out that we are still in a range of low rates.
30-year fixed rate conventional mortgages are, at the time of this writing, in a best execution range between 3.375% and 3.5%. That’s up slightly from the a previous range that had 3.625% at the bottom end.
FHA mortgage loan rates hold steady at a best execution 3.25%. FHA rates tend to vary more among participating lenders so your experience here may vary depending on the financial institution.
The rates quoted here are “best execution” rates, and assume an extremely well-qualified borrower. Your credit scores, debt repayment history and other financial factors will play an important role in determining your access to rates like these. They are not available to all borrowers or from all lenders-your experience may vary.
Market watchers continue to look to bond market activity as a general indicator of where mortgage rates might go in the short term. Rates are not tied to events like Treasury Auctions, but investor reaction to those things can influence mortgage loan rates. If you are not sure about locking or floating this week, have a conversation with your loan officer.
Floating is never without risk, but this week the risk is elevated due to short term conditions in bond markets, plus the previously mentioned economic data releases due out this week including Friday’s NonFarm Payrolls report. We could see rates continue on their upward trend this week, but keep in mind that breaking news, unexpected details in these reports, or other factors could also have the opposite effect on rates.
Many industry pros are using the word “lock” so far this week instead of “float”. There is elevated risk of volatility this week, so added caution is advised; before you choose to float (delaying a mortgage loan interest rate lock with your lender in hopes that rates might fall lower first), have that conversation with your lender for some expert advice.
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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