Mortgage rates fell again for the second straight day--something that has only happened a few other times so far this year.  On an even brighter note, this was the first week of 2018 where the average lender ended the week offering rates that were at least as good as those seen at the end of the previous week.  In most cases, today's rates are right in line with those seen last Friday. 

For the average lender, that means conventional 30yr fixed rates of 4.5 to 4.625% on top tier scenarios.  The same scenarios were seeing quotes of 3.875-4.0% at the beginning of the year.

As we discussed yesterday, "good days" for mortgage rates need some context at the moment.  Yesterday was a good day too, but it happened to follow the worst day in more than 4 years (in terms of outright levels).  In general, as rates trend higher, we should expect to see these sorts of bounces back from time to time.  At some point, one of these bounces could materialize into a broader recovery.  While such a move isn't likely to restore the same rates seen earlier in the year, it could nonetheless make a meaningful difference compared to recent highs.

Unfortunately, we still haven't seen enough improvement to conclude that we're on the verge of such a recovery.  That would begin to change if next week is as decent as this week was. 

Loan Originator Perspective

Bond markets logged more meaningful gains today, but as of early PM only a few lenders had issued mid-day pricing improvements.  I can't blame secondary desks for being reticent to pass along gains when, for weeks now, they've failed to last.  If locking today, wait as long as possible (or lock on weekend if that's an option) to let more lenders improve pricing.  Locking early in the loan process is still advised, but nice to see some green for a change. -Ted Rood, Senior Originator

I would love to recommend floating today, but we have seen several times in the recent past this kind of move to only reverse the next day to even worse levels.  Prudence suggest that you do lock, but wait until as late as possible today.  A few lenders have reissued rate sheets for the better so give your lender the time they need to hopefully follow. -Victor Burek, Churchill Mortgage

Today's Most Prevalent Rates

• 30YR FIXED - 4.625%
• FHA/VA - 4.375%
• 15 YEAR FIXED - 3.875%
  
• 5 YEAR ARMS -  3.5-3.75% depending on the lender

Ongoing Lock/Float Considerations

• 2017 had proven to be a relatively good year for mortgage rates despite widespread expectations for a stronger push higher after the presidential election in late 2016. 
  
  
• While rates remain low in absolute terms, they moved higher in a more threatening way heading into the 4th quarter, relative to the stability and improvement seen earlier in 2017
  
  
• The default stance for now is that this trend toward higher rates has the potential to continue.  It will take more than a few great days here and there for that outlook to change.
  
  
• For weeks, this bullet point had warned about recent stability inviting a bigger dose of volatility.  That volatility is now here.  As such, locking is generally the better choice until the volatility is clearly dying down.

• Rates discussed refer to the most frequently-quoted, conforming, conventional 30yr fixed rate for top tier borrowers among average to well-priced lenders.  The rates generally assume little-to-no origination or discount except as noted when applicable.  Rates appearing on this page are "effective rates" that take day-to-day changes in upfront costs into consideration.