Current Mortgage Rates

Mortgage rates were mixed this week but continue to hover near a multi-year low as expectations for a July interest rate cut continue to build.  A recent speech by Federal Reserve Chair Jerome Powell highlighted the uncertain economic impact of ongoing trade disputes as a potential reason the Fed could move on rates.  When you couple Powell's comments with the most recent employment report that showed slowing job creation and wage growth, multiple signs are pointing toward the Fed lowering rates at its next meeting.  

Mortgage rates had been relatively stable after the Fed left interest rates unchanged at its May meeting and offered little in its minutes to suggest it would deviate from its patient approach to monetary policy.  The Fed pointed to a slowdown in household spending and business investment as well as low inflation in keeping the target range for the Federal Funds rate at 2.250% - 2.500%. 

Over the past month, however, trade disagreements with China and Mexico, stock market volatility, Powell's comments and a disappointing jobs report, pushed mortgage rates lower.  Although rate performance varied by loan program this week, they remain near a two year low, creating an attractive opportunity to buy a home or refinance. 

The interest rate for a 30 year fixed rate mortgage was flat at 3.750%, staying its low point since 2018.  The rate for a 15 year fixed rate mortgage remained at 3.375% and the rate on a 5/1 adjustable rate mortgage (ARM) was steady at 3.500%.  In positive news, FHA mortgage rates and VA mortgage rates both dipped 0.125% to 3.375%, with both programs appealing to borrowers focused on low or no down payment programs, especially first-time home buyers.  On the flips side, Jumbo mortgage rates moved 0.125% higher to 3.875%, rising above conforming loan rates for the first time in several weeks.  Non-owner occupied mortgage rates also increased 0.125% to 4.250%, which remains an attractive rate for investment property buyers.    

After nine rate increases over four years, the March and May Fed meetings signaled a significant shift in policy.  The Fed's newfound patience and more flexible strategy enable it to tighten or loosen monetary policy as economic conditions fluctuate.  It also means that external market factors may have a more significant impact on mortgage rates at certain points in time, as we experienced over the past month.

Although the May meeting statement and minutes seemingly suggested flat rates for the rest of 2019, Powell's speech signaled that lower rates could be necessary depending on how trade conflicts affect the economy and how inflation performs in the coming months.  The way mortgage rates have responded over the past month suggests that the market expects a rate decrease sooner rather than later.  This is welcome news for mortgage borrowers and a housing market that has been battered by fluctuating rates and limited supply.  

Because interest rates are impossible to predict, prospective borrowers looking to buy a home or refinance should take advantage of any dips, like the one we are currently experiencing, as rates can change quickly.  Additionally, as lenders react differently to dynamic market conditions, we have seen a wider variation in mortgage rate pricing, which means borrowers benefit more by shopping multiple lenders.

Because mortgage rates change constantly, we continue to actively monitor the market for new developments.  Borrowers should check the FREEandCLEAR rate tables regularly to review personalized, updated mortgage rates for lenders in their area.  Our rate tables are free to use and require no personal information.