Mortgage Rates Today Move Higher as FOMC is Set to Meet Next Week

Mortgage rates moved slightly higher as the markets await the important Federal Open Market Committee (FOMC) meeting next week. Fixed conforming mortgage rates have been on a tear this summer. 30 year conforming rates have risen over 125 basis points and 30 year jumbo rates have increased almost 100 basis points.

Rates have been range bound the past few weeks because 10 year bond rates have also been trading in a tight range. After making record lows the past year, mortgage rates are headed higher long term. The direction of short term rates will depend on what the FOMC says after their two day meeting next week on the 17th and 18th.

Hint of FOMC Tapering Purchases Sends Bond Rates and Mortgage Rates Higher

Loan Type

Purchase Refinance with Cash out Refinance

State

Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District Of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming

FICO Score

Superior (780-850) Exceptional (760-779) Excellent (740-759) Very Good (720-739) Good (700-719) Above Average (680-699) Average (660-679) Fair (640-659) Need Improvement (620-639) Poor (350-620)

Loan Amount

$

Points

Up to 0 points Up to 0.5 points Up to 1 points Up to 1.5 points Up to 2 points Up to 2.5 points Up to 3 points

LTV

%

Loan Term

 15-Year Fixed  20-Year Fixed  30-Year Fixed  5-Year ARM  7-Year ARM  10-Year ARM

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The lenders whose rates and other terms appear on this chart are ICB's advertising partners. They provide their rate information to our data partner RateUpdate.com. Unless adjusted by the consumer, advertisers are sorted by APR from lowest to highest. For any advertising partners that do not provide their rate they are listed in advertisement display units at the bottom of the chart. Advertising partners may not pay to improve the frequency priority or prominence of their display. The interest rates, annual percentage rates and other terms advertised here are estimates provided by those advertising partners based on the information you entered above and do not bind. Any lender Monthly payment amounts stated do not include amounts for taxes and insurance premiums. The actual payment obligation will be greater if taxes and insurance are included. Although our data partner RateUpdate.com collects the information from the financial institutions themselves, the accuracy of the data cannot be guaranteed. Rates may change without notice and can change intraday. Some of the information contained in the rate tables including but not limited to special marketing notes is provided directly by the lenders. Please verify the rates and offers before applying for a loan with the financial institution themselves. No rate is binding until locked by a lender.

Lender

APR / Rate

Fees / Points

Payment

NMLS #1835285

5.296%

15-Year Fixed

5.125%

$4,500

Includes 0.625 points for $2,500

Lender Fees: $2,000

$3,190 /mo

Next >

NMLS #2578474

5.370%

15-Year Fixed

5.250%

$3,150

Includes 0.525 points for $2,100

Lender Fees: $1,050

$3,216 /mo

Next >

NMLS #757416

5.513%

15-Year Fixed

5.375%

$3,616

Includes 0.904 points for $3,616

Lender Fees: $0

$3,242 /mo

Next >

NMLS #1025894

5.525%

15-Year Fixed

5.375%

$3,932

Includes 0.808 points for $3,232

Lender Fees: $700

$3,242 /mo

Next >

NMLS #6606

5.763%

15-Year Fixed

5.625%

$3,592

Includes 0.898 points for $3,592

Lender Fees: $0

$3,295 /mo

Next >

NMLS #401822

6.175%

15-Year Fixed

6.000%

$4,495

Includes 0.625 points for $2,500

Lender Fees: $1,995

$3,376 /mo

Next >

NMLS #1835285

6.259%

5-Year ARM

6.125%

$5,724

Includes 0.931 points for $3,724

Lender Fees: $2,000

$2,431 /mo

Next >

NMLS #1835285

6.266%

30-Year Fixed

6.125%

$6,000

Includes 1.000 points for $4,000

Lender Fees: $2,000

$2,431 /mo

Next >

NMLS #2578474

6.336%

30-Year Fixed

6.250%

$3,650

Includes 0.650 points for $2,600

Lender Fees: $1,050

$2,463 /mo

Next >

NMLS #757416

6.558%

30-Year Fixed

6.490%

$2,836

Includes 0.709 points for $2,836

Lender Fees: $0

$2,526 /mo

Next >

NMLS #1025894

6.577%

30-Year Fixed

6.490%

$3,604

Includes 0.726 points for $2,904

Lender Fees: $700

$2,526 /mo

Next >

NMLS #401822

6.632%

30-Year Fixed

6.500%

$5,495

Includes 0.875 points for $3,500

Lender Fees: $1,995

$2,529 /mo

Next >

NMLS #6606

6.717%

30-Year Fixed

6.625%

$3,828

Includes 0.957 points for $3,828

Lender Fees: $0

$2,562 /mo

Next >

Rate data provided by RateUpdate.com. Displayed by ICB, a division of Mortgage Research Center, NMLS #1907, Equal Housing Opportunity. Payments do not include taxes and insurance premiums. Actual payments will be greater with taxes and insurance included. Rate and product details.

Markets are concerned that the FOMC is going to announce a tapering of their policies designed to force long term bond rates and mortgage rates lower. The FOMC has made monthly purchases of $40 billion a month in mortgage-backed securities (MBS) and $45 billion a month in long term bonds. The FOMC has also been rolling maturing bonds over into new bonds and reinvesting principal payments on all agency debt and agency mortgage-backed securities into agency mortgage-backed securities.

These policies have forced rates down to record lows so even the possibility of the FOMC pulling back is why rates have already moved considerably higher. If the FOMC does announce a tapering or even set a day for ending these policies, bond rates and mortgage rates will move even higher.

Mortgage Rates Today on 30 Year Conventional Loans

Mortgage rates today on 30 year conforming loans are averaging 4.58 percent, up from last week when rates averaged 4.54 percent. The increase the past week in average 30 year rates was small but if the FOMC makes an announcement next week, average 30 year rates will move above 5.00 percent. By mid 2014, average 30 year rates will move towards 6.00 percent.

The last time 30 year mortgage rates averaged above 5.00 percent was over three years ago in January of 2010. That month 30 year conforming rates averaged 5.03 percent. The last time 30 year rates were above 6.00 percent was back during the financial crisis and recession. In May 2008, average 30 year rates were at 6.04 percent.

Jumbo Mortgage Rates Move Higher

Current mortgage rates on 30 year jumbo loans are averaging 4.88 percent, an increase from last week's average 30 year jumbo rate of 4.76 percent. The future direction of jumbo rates both short term and long term will be higher. If the FOMC pulls back on their purchases, 30 year jumbo rates will move above 5.00 percent and possibly as high as 5.25 percent.

The last time 30 year jumbo mortgage rates were above 5.00 percent was July 2010 when 30 year jumbo rates averaged 5.13 percent. By the middle of next year, average 30 year jumbo mortgage rates will probably be above 6.00 percent. Right now there are lenders still quoting 30 year jumbo rates under 4.50 percent with points.

15 Year Conforming Rates Remain Above 3.50 Percent

Today's mortgage rates on 15 year conforming loans remain above 3.50 percent this week. This marks the the third consecutive week that rates are above 3.50 percent. Average 15 year rates this week are at 3.59 percent, an increase from last week's average 15 year rate of 3.53 percent. The future direction of 15 year rates also hinges on what the FOMC does next week.

Average 15 year rates could move above 4.00 percent if the FOMC slows their purchases. If the FOMC doesn't change policy, I wouldn't expect rates to fall very much. Average rates might fall as low as 3.40 percent but not much lower since 10 year bond yields probably won't decline markedly.

15 Year Jumbo Mortgage Rates at 4.18 Percent

Mortgage rates currently on 15 year jumbo loans are averaging 4.18 percent, an increase from last week's average 15 year jumbo rate of 4.12 percent. 15 year jumbo rates have remained above 4.00 percent for over a month. Back in early July, 15 year jumbo rates were averaging around 3.50 percent.

Next week's move for 15 year jumbo rates will be higher if the FOMC changes policy. Average 15 year jumbo rates will move to around 3.35 percent. If the FOMC doesn't act, 15 year rates will remain around current levels and remain above 4.00 percent. The lowest 15 year jumbo refinance rates we could find quoted by lenders was just under 4.00 percent at 3.875 percent.