Mortgage and refinancing rates today, January 31| prices are increasing
Today’s mortgage and refinancing rates
Average mortgage rates fell slightly again last Friday. But they rose a bit throughout the week. And they remain close to their two-year high. Remember, the last two years have been the lowest mortgage rates ever, and today’s are still exceptionally low compared to normal times.
Markets were relatively calm this morning after last week’s volatility. Heaven knows how long this will take. But if this calm endures the coming hours, Mortgage rates could be higher today.
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Current mortgage and refinancing rates
|program||mortgage rates||Effective interest rate*||change|
|Conventional 30 years fixed||3,799%||3,823%||Unchanged|
|Conventional 15 year fixed||3.14%||3.178%||Unchanged|
|Conventional 20 years fixed||3,452%||3,487%||-0.01%|
|Conventional 10 year fixed||3,066%||3.134%||Unchanged|
|30 year solid FHA||3,899%||4,678%||Unchanged|
|15 year solid FHA||3.155%||3,767%||Unchanged|
|5/1 ARM FHA||4.25%||4.318%||+0.06%|
|30 years solid VA||3,954%||4.16%||+0.02%|
|15 years solid VA||3.36%||3,703%||+0.04%|
|5/1 ARM VA||3,761%||3,284%||+0.07%|
|Prices are provided by our partner network and may not reflect the market. Your tariff may vary. Click here for an individual price offer. See our rate assumptions here.|
Should You Lock A Mortgage Rate Today?
I still think the upward pressure on mortgage rates is irresistible. And overall, I expect these rates to rise slightly over the next few months and probably longer. But there will inevitably be periods of decline within this trend.
Still, my personal rate-locking recommendations remain:
- LOCK when it closes 7 days
- LOCK when it closes fifteen days
- LOCK when it closes 30 days
- LOCK when it closes 45 days
- LOCK when it closes 60 days
>Related: 7 tips to get the best refinancing rate
Market data affecting today’s mortgage rates
Here’s a snapshot of the current status at around 9:50 am ET this morning. The data, compared to around the same time last Friday, was:
- the Yield on 10-year treasury bills stable at 1.80%. (Neutral for mortgage rates.) More than any other market, mortgage rates typically tend to follow these particular government bond yields
- Major Stock Indices were mixed. (Neutral for mortgage rates.) When investors buy stocks, they often sell bonds, pushing down their prices and raising yields and mortgage rates. The opposite can happen when indices are lower. But this is an imperfect relationship
- oil prices fell from $88.46 a barrel to $87.19. (Good for mortgage interest*.) Energy prices play a big role in creating inflation and also point to future economic activity
- gold prices rose to $1,800 from $1,785 an ounce. (Bad for mortgage rates*.) In general, interest rates are better when gold is rising and worse when gold is falling. Gold tends to rise when investors are worried about the economy. And worried investors tend to push rates down
- CNN Business Fear & Greed Index — increased from 32 to 35 from 100. (Bad for mortgage rates.) “Greedy” Investors push bond prices down (and interest rates up) when they exit the bond market and into stocks, while “anxious” investors do the opposite. So lower values are better than higher ones
*A change of less than $20 in gold or 40 cents in oil is a fraction of 1%. So we only count meaningful differences as good or bad for mortgage rates.
Reservations on Markets and Courses
Before the pandemic and the Federal Reserve’s intervention in the mortgage market, you could look at the numbers above and get a pretty good idea of what was going to happen to mortgage rates that day. But that is no longer the case. We still talk on the phone every day. And are mostly right. But our accuracy record won’t reach its previous high level until things settle down.
Therefore, use markets only as a rough guide. Because they have to be exceptionally strong or weak to be able to rely on them. But with this caveat Mortgage rates could rise slightly today. Note, however, that “intraday swings” (when prices change direction throughout the day) are a common feature these days.
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Important notes on today’s mortgage rates
Here are some things you need to know:
- Typically, mortgage rates rise when the economy is doing well and fall when it’s troubled. But there are exceptions. Read ‘How mortgage rates are determined and why you should care‘
- Only “premium” borrowers (with great credit, large down payments, and very healthy finances) get the ultra-low mortgage rates you’ll see in the ads
- Lenders vary. Yours may or may not follow the crowd when it comes to daily price action – although they all usually follow the broader trend over time
- When daily interest rate changes are small, some lenders adjust closing costs and leave their price lists the same
- The refinancing rates are usually close to those for purchases.
There’s a lot going on at the moment. And no one can claim to know for sure what will happen to mortgage rates in the hours, days, weeks, or months ahead.
Are mortgage and refinancing rates rising or falling?
Mortgage rate movements are still all about the Federal Reserve. Well, the Fed and inflation. Because excessive inflation forces the Fed to act.
Last Wednesday, the Fed revealed more about its plans to fight inflation. And they looked particularly bad for low mortgage rates for two reasons:
- In 2022, it will raise its own rates several times
- It will start selling some of its $2.66 trillion Holdings of mortgage-backed securities (MBS) later this year, maybe as early as June
Both are likely to drive up mortgage rates. In fact, selling MBS (a type of bond that largely drives mortgage rates) is the opposite of the Fed’s two-year program, which is now expiring. This has led to mortgage rates being pushed to new lows by the purchase of MBSs. You don’t need a Nobel Prize in Economics to imagine the impact the sale will have.
Of course, the future is never certain. And a major catastrophe could strike, stalling the economic recovery, killing inflation and forcing the Fed to reverse. But let’s hope that doesn’t happen.
In the meantime, I expect plenty of ups and downs, especially as long as recent market volatility continues. But I’d be surprised if the general direction of mortgage rates isn’t up.
For a more detailed look at what’s happening with mortgage rates, read the last weekend’s edition of this report.
For much of 2020, the overall trend in mortgage rates was clearly down. And according to Freddie Mac, a new weekly all-time low has been hit 16 times this year.
The most recent weekly record low was on Jan. 7, 2021, when it was 2.65% for 30-year fixed-rate mortgages.
Since then, the picture has been mixed by extended periods of ups and downs. Unfortunately, since last September the increases have become more pronounced, although not consistent.
Freddies January 27th Report puts that weekly average for 30-year fixed rate mortgages at 3.55% (with 0.7 fees and points), barely changed from 3.56% of the previous week. But this Thursday report will not include the previous day’s notable increase. And mortgage rates actually went up Thursday-Thursday week.
Mortgage rate forecasts by experts
Looking ahead, Fannie Mae, Freddie Mac, and the Mortgage Bankers Association (MBA) each have a team of economists dedicated to monitoring and forecasting what will happen to the economy, housing, and mortgage rates.
And here are their current interest rate forecasts for the four quarters of 2022 (Q1/22, Q2/22, Q3/22, Q4/22).
The figures in the table below refer to 30-year fixed-rate mortgages. Fannies was released on January 19th and Freddies and the MBAs on January 21st.
Personally, I was surprised that Fannie Mae only slightly raised its interest rate forecasts in January. She expects interest rates on 30-year fixed-rate mortgages to average 3.2% in the current quarter. But on the day the numbers were released, we reported that traditional loans were already up 3.87%.
Do Fannie economists expect these rates to come down later this month or in February or March and stay lower in subsequent quarters? If so, you know something I don’t know. Neither do their peers on Freddie and the MBA teams, although I’m less optimistic than everyone else.
Of course, with so many unknowns, the entire current crop of forecasts can be even more speculative than usual.
Find your cheapest fare today
You should compare extensively no matter what type of mortgage you want. As the federal regulator, the Consumer Financial Protection Bureau says:
“If you look after your mortgage, you can make real savings. It may not sound like much, however Saving even a quarter point in interest on your mortgage saves you thousands of dollars over the life of your loan.”
Confirm your new plan (January 31, 2022)
Mortgage interest methodology
The Mortgage Reports receives daily rates based on selected criteria from multiple lending partners. We get an average interest rate and APR for each loan type shown in our chart. As we average a range of rates, you’ll get a better idea of what you might find on the market. In addition, we calculate interest rates for the same types of credit. For example FHA fixed with FHA fixed. The end result is a good snapshot of daily rates and how they change over time.