Mortgage rates have moved lower every day this week.  Today's move was even more pronounced than yesterday's, carrying rates decisively into NEW all-time lows.   Today's data and events during the domestic market session were of little concern to Secondary Mortgage Markets, which began the day in stronger territory thanks to the overnight sessions in Europe and Asia.  From there, MBS (the "mortgage-backed-securities") that most directly influence rates) essentially held stead for the rest of the day, allowing lenders the ability to pass on more of the improvements.

The continued push into lifetime low territory lets us know that lenders are actually doing a fairly aggressive job of moving rates lower.  Adding to that sense of aggressiveness is the fact that most lenders have priced in the recent increase to Guarantee Fees which equates roughly to .125% higher rates (read more HERE).  For the first time ever, best-execution on 30yr Fixed Conventional Loans is 3.375% at a majority of Lenders, and even lower rates are viable choices at a few lenders for a few scenarios.

(Read More:What is A Best-Execution Mortgage Rate?)

Long Term Guidance: While the recently high degree of uncertainty remains very much intact, the Fed's decision to specifically target Mortgage-Backed-Securities in a third round of Quantitative easing provides a supportive undertone for mortgage rates.  We'd still advocate not trying to get too far ahead markets.  In other words, we wouldn't try to guess how low or how high rates might go before changing course.  For now, the trend is supportive and positive for rates, but we're watching it closely for the same sort of paradoxical responses that occurred in 2010.  Things look different this time around, but a lot of that has to do with Europe.  Rates remain near all time lows and risks of volatility remain high.  Those factors suggest that you stay vigilant regarding the day-to-day swings in mortgage rates.  If you're floating, set a limit as to how high rates would have to go before you cut your losses and locked.  Similarly, set a target of how low rates would have to get before you lock.

Loan Originator Perspectives

Ted Rood, Senior Originator, Bank Star

Rates playing limbo today, with considerable improvement from multiple lenders. Writing 30 year fixed FHA streamlines AND paying costs at 3.25%? It's beyond ridiculous. Worst part of this whole scenario is that many borrowers either don't know how much they could benefit, or are too intimidated by the loan process to investigate it. Either way, they're wasting money each month for no reason!.

Bob Van Gilder, Finance One Mortgage

Lock now, save now? Float now, save more later? Yes and, most likely, yes. (albeit "most likely"). Historic lows today. (Need to come up with another term for historic---may be getting played out.) No reason not to take advantage of these rates. None.

Mike Owens, Partner with HorizonFinancial, Inc.

I'm actually switching my long held stance and will be cautiously floating. I have always felt locking was the safe bet and it still is, however rates just keep dropping. The lock button will still be within reach just in case.

Today's BEST-EXECUTION Rates 

• 30YR FIXED - 3.375% - 3.5%
  
• FHA/VA - 3.25% - 3.5% (varies more between lenders than conventional 30yr Fixed)
• 15 YEAR FIXED -  2.75% - 2.875%%
• 5 YEAR ARMS -  2.625-3.25% depending on the lender

Ongoing Lock/Float Considerations 

• Rates and costs continue to operate near all time best levels
• Rates could easily move higher or lower, but given the nearness to all time lows, there's generally more risk than reward regarding floating
• But that will always be the case when rates operate near all-time levels, and as 2011 showed us, it doesn't always mean they're done improving.
• (As always, please keep in mind that our talk of Best-Execution always pertains to a completely ideal scenario.  There can be all sorts of reasons that your quoted rate would not be the same as our average rates, and in those cases, assuming you're following along on a day to day basis, simply use the Best-Ex levels we quote as a baseline to track potential movement in your quoted rate).