After yesterday's FOMC Announcement, Mortgage Rates moved to all time lows. The rally in bond markets extended overnight and throughout today's trading, resulting in rate offerings improving even more.
Please keep in mind that lenders simply cannot move mortgage rates lower at the same pace as a rapid rally in Benchmark Treasuries. Although you might hear talking heads on TV or read articles saying that mortgage rates are tied to Treasuries, THEY ARE NOT, and you'll be perennially frustrated if you expect them to be. We explained that in greater detail earlier in the month:(Why aren't rates getting lower as fast as Treasuries).
Today's Rates: The current market is in a state of flux at the moment and mortgage rates moving up and down around ALL TIME LOWS. Whereas BestExecution 30yr Fixed rates were mostly near 3.875% yesterday with some lenders at 4.0%, today, they're closer to 3.75% with quite a few lenders still at 3.875%. FHA/VA deals are in a bit of a predicament that's keeping them blocked off below 3.75% (there's no secondary market for rates any lower than that right now!). For similar reasons, 15 year fixed conventional loans may be stuck at 3.25%. The secondary market factors driving adjustable rate loans are in a massive state of flux, but one that is mixed between positive and negative. 5 year ARMS remain near 3.125%, but with variations from lender to lender. Bottom line, adjustable rates aren't participating in this rally to the same extent as fixed rates
GUIDANCE: Today's guidance is all about the risk of "pipeline control" price changes among lenders. Regardless of what happens in markets, be they Treasuries or the Secondary Mortgage Market, lenders can still only write loans to the extent allowed by their capacity. Lenders also must be careful not to lower rates so quickly that borrowers who recently locked actually break those lock commitments in order to move down to a lower rate. Even if borrowers do this at the same lender, it costs lenders a lot of money. So whether it's to avoid that sort of cannibalization or to avoid capacity issues, there's an elevated risk right now of lenders RAISING rates without warning, even if the underlying market movements would not suggest it. If you remember "the wall" that existed for a long time in loan pricing moving from a 4.75% BestExecution to 4.625%, the same underlying problems will make it a slow, difficult process to move from the high to mid 3's, and one that might not happen at all. If you've been waiting for an opportunity to lock in the high 3's, you now have it.