February 2, 2017
Much attention was given to the Fed on Wednesday, but there was no hint of another planned rate hike; good news for now but that did not help mortgage loan rates in the end as stronger-than-expected jobs data helped put upward pressure on rates. Those who are not used to watching mortgage rate trends may be confused at this, seeing that what’s good for the economy will often be bad for mortgage rates.
And that is not just perception. When economic data such as the Employment Situation Report shows strength, that often equals higher rates in the short term.
Such reports do not directly affect mortgage loan interest rates, but investor reaction to that data can and often does. And such was the case on Wednesday, with stronger employment figures and rates edging higher as a result of the investor response to the employment report.
30-year fixed rate conventional mortgages were reported at a best-execution 4.25% on Wednesday, with some borrowers noticing the difference in closing costs where applicable and depending on the lender. FHA mortgage rates are still holding out in their best execution 3.75%. FHA rates tend to vary more among participating lenders, so you may need to shop around for the most competitive interest rates.
The best execution rates listed here assume ideal conditions-your FICO scores and other credit history will play a major part in determining your access to rates like the ones you see here. These rates are not available from all lenders or to all borrowers, and your experience may vary.
Friday is another big day, short-term, for mortgage loan rates because there is another big scheduled economic data release (the Non-Farm Payroll report or NFP for short).
As with the Fed and with the employment report out this week, the NFP is not directly tied to mortgage loan rates, but depending on how investors react to the data we could see short-term effects in mortgage rate trends. Friday will be a day to pay attention if you are not yet committed to a mortgage rate lock with your lender.
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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