March 1, 2017
We’ve seen three days of improvement, followed by two days of mortgage rates creeping upward. The rate environment at the time of this writing is a bit contrary-we have seen stronger economic news and data this week that traditionally has put upward pressure on interest rates.
But the most recent stronger data hasn’t put as much pressure on mortgage rates and for that we can report that number-wise, the best execution rates haven’t budged that much. Affected borrowers will likely see the difference reflected in closing costs.
30-year fixed rate conventional mortgages are holding at a best execution 4.125% at the time of this writing, which is an adjustment from the earlier range between 4.125% and 4.25% best execution. FHA mortgage rates are holding in a range between 3.75% and 4.25%.
That’s quite a spread for FHA rates, and it’s a range we’ll be keeping an eye on in the foreseeable future. FHA rates tend to vary more among participating lenders so it is a very good idea to shop around for the most competitive rates and terms. As always, the numbers reported here for both conventional and FHA rates are discussed as “best execution” rates, which assume ideal conditions.
Your FICO scores, loan repayment history, and other financial qualifications will go a long way toward determining your access to numbers like the ones reported here. These rates are not available from all lenders or to all borrowers. Your experience may vary.
Locking or floating? There are tricky choices in the days ahead since there is still quite a bit of uncertainty in the markets over fiscal policies, the outcome of proposed or actual changes to trade agreements, etc.
Investor reaction to economic news can play a big part in whether rates rise or fall, and in the current state of things it is best to have a conversation with the lender if you are tempted to “float” or hold off on a mortgage rate lock in hopes that rates will drop soon.
Your risk tolerance-the ability to withstand an interest rate move higher-is a key factor in the decision to lock or float. Set a limit on how high rates might climb before you lock your commitment in for best results should you choose to float.
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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