March 9, 2017
This week we’ve devoted a bit more column space to mortgage rate trends, and for good reason. Markets hate uncertainty, investors tend to move to “safe haven” investments in times like these, and we’re seeing plenty of activity in markets that affect mortgage loan rates in this area. Add to that economic data releases which, though spelling out good things for the country, put upward pressure on mortgage rates.
That adds up to significant short term activity. And the latest has both conventional mortgage loan interest rates and FHA mortgage rates moving into new, higher ranges.
30-year fixed rate conventional mortgages are reported, at the time of this writing, in a new best-execution range between 4.25% and 4.375%, a sharp turn upward some professional market watchers are labeling the highest, or among the highest of 2017 in terms of how high in a one-day change.
And FHA mortgage rates were not immune to Wednesday’s climb, either. FHA mortgage loan best execution interest rates breached the four percent range earlier this year, but the overall range was still sub-four perccent (3.75%) at the bottom. That is gone for now, replaced by a new best-execution range between 4.0% and 4.25%. FHA rates tend to vary more among participating lenders. Shop around for the most competitive rates and terms.
What is the cause for Wednesday’s sharp turn higher? Many industry professionals blame the better-than-expected ADP Employment Report for February, but there is another employment report due out on Friday which could also affect mortgage rates accordingly. That means investors are looking not only at the current day’s data but also anticipating Friday’s information-and they are reacting accordingly.
All of this makes it a very tough time to choose “floating” as your option for a mortgage rate lock commitment with a lender. Floating is never free of risk, but at the moment the short term risk is by all accounts hardly worth taking the chance. The advice borrowers are getting from professionals right now is that it may be better to expect rates to keep rising in the short term and plan accordingly.
As always, the rate information seen here is listed as “best execution” and may not be available to all borrowers. Your FICO scores and other financial qualifications will play a role in determining your access to rates like these. Your experience may vary. Ask your loan officer if you are unsure how your credit scores might affect your access to the best rates.
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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