January 12, 2017
Before the new year, but after the 2016 election, mortgage rate trends were in what seemed to be an upward trajectory due to a variety of factors including uncertainty among investors regarding the new administration. But since the new year, we’ve seen more recovery, including the days following our last report.
On Thursday, mortgage rates continued improving in small increments, with affected borrowers often getting the benefit in closing costs rather than an actual change in the mortgage rate. At the time of this writing, 30-year fixed rate conventional mortgages were at a best-execution 4.125%.
That’s not a change from our previous report, but according to our sources more lenders are offering this best-execution rate now than since our last post. 4.125% could be at or near what some market watchers are tentatively calling a new range of rates, similar to the kind of range we were looking at pre-election when rates were at or near the 3.5% – 3.75% zone.
FHA mortgage rates are holding steady for now at a best execution 3.75%. FHA mortgage rates may vary more among participating lenders so it is a good idea to shop around for the best rates.
As always, “best execution” refers to situations with ideal conditions including a loan applicant with outstanding FICO scores and other financial qualifications. The rates listed here are not available to all borrowers or from all lenders; your experience may vary.
Borrowers who aren’t sure whether to lock in a mortgage rate commitment with the lender or “float” in hopes of getting a lower rate will definitely want to have a conversation with the loan officer for some good advice. Some industry pros point to a reduced risk for floating now in the short term, but in the same breath will also advise that the rewards for floating may also be less. If you have a closing date coming up soon, it may be tempting to lock in your rate and not be worried about possible changes to rates in the future.
Floating is never risk-free, even when the experts say that risk is lower. Breaking economic news, world events, and scheduled economic data releases all have the power to change the rate environment depending on investor reaction to those things. It’s important to understand that possibility when considering whether or not 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.
Browse by Date: