As mortgage rates fall, homeowners miss a new chance to refinance and save


Yahoo Finance 08 July, 2021 - 09:36am 22 views

Mortgage rates are driven down to their lowest levels since winter

The Washington Post 08 July, 2021 - 09:05am

According to the latest data released Thursday by Freddie Mac, the 30-year fixed-rate average dropped to 2.90 percent with an average 0.6 point. (Points are fees paid to a lender equal to 1 percent of the loan amount. They are in addition to the interest rate.) It was 2.98 percent a week ago and 3.03 percent a year ago. The 30-year fixed rate has remained below 3 percent six of the past seven weeks.

The survey is based on home purchase mortgages, which means rates for refinances may be higher. The price adjustment for refinance transactions that took effect in December is adding to the cost. The adjustment, which applies to all Fannie Mae and Freddie Mac refinances, is 0.5 percent of the loan amount. That works out to $1,500 on a $300,000 loan.

The 15-year fixed-rate average slid to 2.20 percent with an average 0.7 point. It was 2.26 percent a week ago and 2.51 percent a year ago. The five-year adjustable rate average fell to 2.52 percent with an average 0.2 point. It was 2.54 percent a week ago and 3.02 percent a year ago.

“Mortgage rates fell this week, reaching their lowest level since the winter,” said Matthew Speakman, a Zillow economist. “Despite generally strong headline June jobs figures, a booming stock market and broader signs that the economy continues to recover, investors are continuing to downwardly revise their very optimistic forecasts for economic growth that they made earlier in the year. This shift in sentiment is placing downward pressure on longer-term Treasury yields and the mortgage rates they influence.”

Despite June’s employment report showing improvements in the labor market, the yield on the 10-year Treasury sank to its lowest point since February this week, closing at 1.33 percent on Wednesday. Wall Street analysts are baffled by the drop. Many predicted as the economy improved that investors would ditch bonds, causing yields to rise near 2 percent at this point. Instead, they have fallen.

“We have come a long way from the inflation concerns rocking the markets in the first and second quarters,” said James Sahnger, a mortgage planner at C2 Financial. “Since peaking at 1.75 percent on March 31, [10-year Treasury yields] have fallen down to a low of 1.298 percent on Wednesday before nudging up from there. [Mortgage] rates can move down a bit from here but have some technical support levels at 1.29 percent and 1.23 percent on the 10-year Treasury that may prove tough to crack. … We are still waiting for mortgage rates to catch up to Treasurys to match their decline.”

Minutes from the Federal Reserve’s June meeting were released this week. They indicated that Fed officials have begun talking about tapering their bond-buying program, which has kept mortgage rates low, but not many seem eager to begin the process. Although financial markets had a muted reaction to the news, it is expected that when the Fed does begin winding down its purchases, that will send mortgage rates higher.

“Markets are trying to anticipate the timing of the Fed’s next move and this week, the Fed meeting minutes conveyed more patience toward tapering and rate hikes than the market had expected immediately following the late June meeting,” said Danielle Hale, chief economist at “In other words, [mortgage] rates slipped as investors realized that the last Fed discussion may not have been as hawkish as was originally believed. Looking forward, we expect rates to bounce roughly around the 3 percent mark until at least August, which is the earliest that the Fed is likely to provide a clearer timeline for scaling back its mortgage-backed security purchases.”, which puts out a weekly mortgage rate trend index, found that more than half of the experts it surveyed expect rates to go down in the coming week.

“Right now, the spread between 30-year fixed mortgage rates and 10-year Treasury yields is 1.8 percent,” said Ken H. Johnson, real estate economist at Florida Atlantic University. “Normally, this spread falls between 1.7 percent and 1.9 percent. Ten-year yields are falling noticeably after the holiday. This should result in a slight downturn in long-term mortgage rates. In the coming week, 30-year mortgage rates should fall marginally.”

Meanwhile, mortgage applications were down for the second week in a row, dropping to their lowest level since the beginning of 2020. According to the latest data from the Mortgage Bankers Association, the market composite index — a measure of total loan application volume — decreased 1.8 percent from a week earlier. The refinance index fell 2 percent, while the purchase index slipped 1 percent. The refinance share of mortgage activity accounted for 61.6 percent of applications.

“Mortgage applications for both refinances and home purchases fell on a weekly and annual basis last week,” said Bob Broeksmit, MBA president and chief executive. “Mortgage rates are lower than they were last summer, but many homeowners have already refinanced at rates that were even lower around the end of last year. Despite meager supply and swift home-price growth, the purchase market remains strong. The improving economy, continuous job and wage growth, and mortgage rates around 3 percent are positive signs for a solid second half of the year.”

Today's mortgage refinance rates: 20-year rates jump, other terms hold steady | July 8, 2021

Fox Business 08 July, 2021 - 08:09am

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Based on data compiled by Credible, current mortgage refinance rates have mostly held steady since yesterday, except for 20-year rates, which increased. 

After dropping to a near five-month low of 2.500% yesterday, today’s 20-year mortgage refinance rates jumped back up to 2.750%. Rates across 30-, 15- and 10-year terms are higher than they were at the beginning of the week, but all terms remain at historic lows, so homeowners looking to refinance could still find a bargain. 

The current rate for a 30-year fixed-rate refinance is 2.990%. This is the same as yesterday.

The current rate for a 20-year fixed-rate refinance is 2.750%. This is up from yesterday.

The current rate for a 15-year fixed-rate refinance is 2.250%. This is the same as yesterday.

The current rate for a 10-year fixed-rate refinance is 2.250%. This is the same as yesterday.

Today, mortgage refinance rates are mixed compared to this time last week.

Current refinance rates, like mortgage interest rates in general, are affected by many economic factors, like unemployment numbers and inflation. But your personal financial history will also determine the rates you’re offered when refinancing your mortgage.

If you’re seeking lower monthly payments on an existing home, Credible can help you keep an eye on current mortgage rates and find the right loan for your financial goals.

Have a finance-related question, but don't know who to ask? Email The Credible Money Expert at and your question might be answered by Credible in our Money Expert column.

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What The Fed Taper Tug-Of-War Means For Mortgage Rates | Bankrate 07 July, 2021 - 11:10pm

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Mortgage rates have been pushed to historic lows since the start of the coronavirus pandemic in the U.S., and new minutes from the Federal Reserve’s Open Market Committee (FOMC) hint that they’re likely to remain low, at least for a while.

In a nutshell, that’s because the Fed’s latest minutes suggest that the central bank isn’t ready to shift its monetary policy just yet — a change that most experts think will come first in the form of what’s known as tapering, or slowing the pace at which it buys assets like bonds on the open market.

“Several of these participants emphasized that the Committee should be patient in assessing progress toward its goals and in announcing changes to its plans for asset purchases,” the minutes from the June meeting stated.

If you’re not up on the jargon, here’s what Greg McBride, Bankrate’s chief financial analyst, said that actually means for you and your money, particularly borrowing rates.

The Fed influences economic conditions on the ground by buying up financial assets in the open market. Those purchases, or lack of them, all filter down to influence how much banks and other lenders charge on personal financial products like mortgages.

With economic uncertainty high as a result of the pandemic, the Fed has been on a buying spree, snapping up billions of dollars in assets like mortgage bonds. As the recovery picks up steam, the Fed is likely, at some point, to feel less inclined to keep injecting money into the economy, because that can push inflation higher, which counterintuitively results in you, the consumer, having less buying power. Slowing down the rate of government asset purchases, until those purchases eventually hit zero, is what’s informally known as tapering.

“The prospect of the Federal Reserve dialing back their pace of bond purchases would seem to conclude that mortgage rates have only one direction to go – up. But there are a number of variables at play, particularly around the timing and magnitude of the tapering,” said McBride.

A slower, more delayed taper will encourage mortgage rates to stay down, while a faster, sooner one will push them up more quickly.

“If economic growth comes in on the soft side, or if inflation does indeed look to be transitory, the Fed doesn’t need to taper as soon or as fast as might be assumed, keeping bond yields and mortgage rates low,” McBride said. “But if the Fed is seen as behind the inflation curve or they taper the mortgage bond purchases sooner or faster than Treasuries, mortgage rates would likely move up.”

The most recent FOMC minutes suggest that the Fed isn’t ready to ramp up its taper yet, so mortgage rates are likely to stay low for a while longer. That could all change in subsequent meetings this year, depending on how the economy evolves.

“Various participants mentioned that they expected the conditions for beginning to reduce the pace of asset purchases to be met somewhat earlier than they had anticipated at previous meetings in light of incoming data,” the minutes said, strongly suggesting that such a change is on the horizon.

The Fed has tried to protect the U.S. economy from the worst of the economic uncertainty surrounding the COVID-19 pandemic through policies that helped promote cheap borrowing. As recovery data comes in, the Fed is likely to reverse those policies to encourage more “normal” economic activity, but the pace at which those changes are made is yet to be determined.

In the meantime, it’s a great time to consider a refi if you haven’t done so recently, because these low mortgage rates are on the verge of being behind us. Lawrence Yun, chief economist at the National Association of Realtors recently told Bankrate he expects interest on mortgages to average about 3.5 percent by the end of this year.


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