October 10, 2016
For the past five business days, mortgage loan interest rates have been in an upward trend. Even after last week’s Employment Situation Report, which had weaker jobs data that anticipated, rates were still on a short-term upward swing.
The employment report and mortgage loan rates aren’t directly tied together, but investor behavior associated with that report often has rates moving lower in the wake of weak jobs data. This time, investor behavior all but ignored this, and the week ended with rates closing out in a range for conventional mortgages higher than we’ve seen in a little while.
30-year fixed rate conventional mortgages closed out Friday in a range between 3.5% and 3.625% best execution. FHA mortgage loan interest rates are still holding in their 3.25% comfort zone, but if the upward trend continues it’s difficult to say how long that might last.
FHA rates often vary more among participating lenders, so it’s safe to say that this best-execution rate should be considered an estimate, not a hard number, which is generally true of most best execution rates listed here.
Market watchers are giving advice in recent days that include more use of the word “lock” than “float”. If you are tempted to float, or hold off on making a mortgage loan interest rate lock commitment with your lender in hopes of rates moving lower first, have a chat with your loan officer. You may need some good advice right now as the short term trend doesn’t seem to favor borrowers, and there are plenty of variables in the coming week that could affect rates.
Wednesday there are several scheduled economic data releases including the release of the Fed meeting minutes from September. There is also some retail sales data due to be released on Friday, which could be the most significant release of the week.
The rates you see here are listed as “best execution” rates, which assumes a highly qualified borrower with outstanding FICO scores, etc. Your experience may vary, and the rates here are not available to all borrowers or from all lenders.
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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