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December
21

Mortgage and refinance rates today, Dec. 20, 2022

Today's mortgage and refinance rates

Average mortgage rates climbed appreciably yesterday. Add in last Friday's smaller rise and it pretty much wipes out last Thursday's worthwhile fall.

By approaching 10 a.m. (ET), it was looking as if mortgage rates today might rise again. If that early momentum survives the day, that will make the third consecutive rise for those rates.

Find your lowest rate. Start here (Dec 21st, 2022)

Current mortgage and refinance rates

Program Mortgage Rate APR* Change
Conventional 30 year fixed 6.271% 6.306% +0.15% 
Conventional 15 year fixed 5.66% 5.714% +0.1% 
Conventional 20 year fixed 6.143% 6.197% +0.08% 
Conventional 10 year fixed 5.862% 5.985% +0.19% 
30 year fixed FHA 6.171% 6.915% +0.08% 
15 year fixed FHA 5.823% 6.318% +0.16% 
30 year fixed VA 5.975% 6.205% +0.18% 
15 year fixed VA 6.194% 6.553% +0.32% 
Rates are provided by our partner network, and may not reflect the market. Your rate might be different. Click here for a personalized rate quote. See our rate assumptions here.

Should you lock a mortgage rate today?

Don't lock on a day when mortgage rates look set to fall. My recommendations (below) are intended to give longer-term suggestions about the overall direction of those rates. So, they don't change daily to reflect fleeting sentiments in volatile markets.

Changes to the following list are on hold until we can see how recent rises play out.

So, for now, my personal rate lock recommendations remain:

  • LOCK if closing in 7 days
  • LOCK if closing in 15 days
  • LOCK if closing in 30 days
  • LOCK if closing in 45 days
  • LOCK if closing in 60 days

>Related: 7 Tips to get the best refinance rate

Market data affecting today's mortgage rates

Here's a snapshot of the state of play this morning at about 9:50 a.m. (ET). The data, compared with roughly the same time yesterday, were:

  • The yield on 10-year Treasury notes climbed to 3.70% from 3.58%. (Bad for mortgage rates.) More than any other market, mortgage rates typically tend to follow these particular Treasury bond yields
  • Major stock indexes were mostly lower soon after opening. (Sometimes good for mortgage rates.) When investors buy shares, they're often selling bonds, which pushes those prices down and increases yields and mortgage rates. The opposite may happen when indexes are lower. But this is an imperfect relationship
  • Oil prices increased to $75.55 from $75.36 a barrel. (Neutral for mortgage rates*.) Energy prices play a prominent role in creating inflation and also point to future economic activity
  • Gold prices nudged up to $1,818 from $1,800 an ounce. (Neutral for mortgage rates*.) It is generally better for rates when gold rises and worse when gold falls. Gold tends to rise when investors worry about the economy.
  • CNN Business Fear & Greed index — fell to 37 from 42 out of 100. (Good for mortgage rates.) "Greedy" investors push bond prices down (and interest rates up) as they leave the bond market and move into stocks, while "fearful" investors do the opposite. So lower readings are better than higher ones

*A movement of less than $20 on gold prices or 40 cents on oil ones is a change of 1% or less. So we only count meaningful differences as good or bad for mortgage rates.

Caveats about markets and rates

Before the pandemic and the Federal Reserve's interventions in the mortgage market, you could look at the above figures and make a pretty good guess about what would happen to mortgage rates that day. But that's no longer the case. We still make daily calls. And are usually right. But our record for accuracy won't achieve its former high levels until things settle down.

So, use markets only as a rough guide. Because they have to be exceptionally strong or weak to rely on them. But, with that caveat, mortgage rates today look likely to rise. However, be aware that "intraday swings" (when rates change speed or direction during the day) are a common feature right now.

Find your lowest rate. Start here (Dec 21st, 2022)

Important notes on today's mortgage rates

Here are some things you need to know:

  1. Typically, mortgage rates go up when the economy's doing well and down when it's in trouble. But there are exceptions. Read 'How mortgage rates are determined and why you should care'
  2. Only "top-tier" borrowers (with stellar credit scores, big down payments and very healthy finances) get the ultralow mortgage rates you'll see advertised
  3. Lenders vary. Yours may or may not follow the crowd when it comes to daily rate movements — though they all usually follow the broader trend over time
  4. When daily rate changes are small, some lenders will adjust closing costs and leave their rate cards the same
  5. Refinance rates are typically close to those for purchases.

A lot is going on at the moment. And nobody can claim to know with certainty what will happen to mortgage rates in the coming hours, days, weeks or months.

Are mortgage and refinance rates rising or falling?

Yesterday, I wrote about my concerns about mortgage rates rising last Friday and this Monday. I feared those increases were a sign that investors were having second thoughts about the euphoria with which they greeted last Wednesday's Federal Reserve events.

Unsurprisingly, yesterday's appreciable rise did little to reassure me. I'm not saying things are bound to get darker for mortgage rates. I still hope they won't. But the sunny optimism I felt over the weekend has begun to melt away.

I did feel a little more reassured reading yesterday evening's analysis by Mortgage News Daily (MND). It shrugged off those recent rises as merely seasonal volatility.

And it's certainly true that markets tend to be more volatile over the holiday season when many senior investors and traders take a break. Without their steadying hand, the remaining staff can easily overreact to minor news. MND suggests staying calm until the second week in January when things are likely to return to normal.

MND has its finger firmly on the pulse of the bond market that largely determines mortgage rates. And I know that what it said yesterday is typically true.

Bond investors' debate

However, I can't shake off my nagging fear that we're witnessing that market revisiting its initial response to last week's Fed events. That's partly because I thought that reaction was irrational at the time.

I may not be alone because investors appear divided on the subject. Here's what yesterday's Wall Street Journal (paywall) had to say (Treasury bonds are closely related to mortgage rates):

"Many investors and bond analysts remain far from convinced that the pain is over for Treasurys. They argue that a still-tight labor market could keep inflation elevated and force the Fed to raise rates higher than the market currently expects, even if economic growth does turn negative over the next 12 months.

"Still, bond investors, as a whole, remain more hopeful on inflation, more worried about economic growth and more skeptical that the Fed will be able to raise interest rates much higher—all of which have provided a boost for Treasurys in recent weeks after an otherwise terrible year for bond returns."

We'll have to wait to see which group wins this debate.

For more background, please read the latest weekend edition of this report.

According to Freddie Mac's archives, the weekly all-time low for mortgage rates was set on Jan. 7, 2021, when it stood at 2.65% for conventional, 30-year, fixed-rate mortgages.

Freddie's Dec. 15 report put that same weekly average at 6.31%, very slightly down from the previous week's 6.33%.

Recently, Freddie stopped including discount points in its forecasts. It has also moved later in the day the time at which it publishes its Thursday reports. And, from now on, we'll be updating this section on Fridays.

Expert mortgage rate forecasts — Updated today

Looking further ahead, Fannie Mae, Freddie Mac and the Mortgage Bankers Association (MBA) each has a team of economists dedicated to monitoring and forecasting what will happen to the economy, the housing sector and mortgage rates.

And here are their rate forecasts for the current quarter (Q4/22) and the first three quarters of next year (Q1/23, Q2/23 and Q3/24).

The numbers in the table below are for 30-year, fixed-rate mortgages. Fannie's and the MBA's forecasts appeared on Dec. 19 and Freddie's on Oct. 21. Freddie now publishes its forecasts quarterly and its figures can quickly become stale.

Forecaster Q4/22 Q1/23 Q2/23 Q3/23
Fannie Mae 6.7% 6.5%  6.4% 6.2%
Freddie Mac 6.8% 6.6%  6.5% 6.4%
MBA 6.6% 6.2%  5.6% 5.4%

Of course, given so many unknowables, the whole current crop of forecasts might be even more speculative than usual. And their past record for accuracy hasn't been wildly impressive.

Find your lowest rate today

You should comparison shop widely, no matter what sort of mortgage you want. As federal regulator the Consumer Financial Protection Bureau says:

"Shopping around for your mortgage has the potential to lead to real savings. It may not sound like much, but saving even a quarter of a point in interest on your mortgage saves you thousands of dollars over the life of your loan."

Verify your new rate (Dec 21st, 2022)

December
19

Earnest Money: What It Is and How Much It Is in Real Estate

What Is Earnest Money?

Earnest money is a deposit made to a seller that represents a buyer's good faith to make a purchase such as the acquisition of a new home. The money gives the buyer extra time to get financing and conduct the title search, property appraisal, and inspections before closing. In many ways, earnest money can be considered a deposit on a home, an escrow deposit, or good faith money.

KEY TAKEAWAYS

  • Earnest money is essentially a deposit a buyer makes on a home they want to purchase.
  • A contract is written up during the exchange of the earnest money that outlines the conditions for refunding the amount.
  • Earnest money deposits can be anywhere from 1–10% of the sales price, depending mostly on market interest.
  • Should a buyer break the terms of the contract, they may be at risk of losing their earnest money deposit.
  • However, there are a number of potentially agreed-upon contingencies that may protect the buyer from backing out of a deal but still keeping all of their earnest money.

Understanding Earnest Money

In most cases, earnest money is delivered when the sales contract or purchase agreement is signed, but it can also be attached to the offer. Once deposited, the funds are typically held in an escrow account until closing, at which time the deposit is applied to the buyer's down payment and closing costs.

When a buyer decides to purchase a home from a seller, both parties enter into a contract. The contract doesn't obligate the buyer to purchase the home, because reports from the home appraisal and inspection may later reveal problems with the house. The contract does, however, ensure the seller takes the house off the market while it's inspected and appraised. To prove the buyer's offer to purchase the property is made in good faith, the buyer makes an earnest money deposit (EMD).

The buyer might be able to reclaim the earnest money deposit if something that was specified ahead of time in the contract goes wrong. For instance, the earnest money would be returned if the house doesn't appraise for the sales price or the inspection reveals a serious defect—provided these contingencies are listed in the contract.

 

In general, earnest money is returned to the buyer if the seller terminates the deal but is awarded to the seller if the buyer unreasonably terminates the deal.

How Much Are the Earnest Money Amounts?

While the buyer and seller can negotiate the earnest money deposit, it often ranges between 1% and 2% of the home's purchase price, depending on the market. In hot housing markets, the earnest money deposit might range between 5% and 10% of a property's sale price.

While the earnest money deposit is often a percentage of the sales price, some sellers prefer a fixed amount, such as $5,000 or $10,000. Of course, the higher the earnest money amount, the more serious the seller is likely to consider the buyer. Therefore, a buyer should offer a high enough earnest deposit to be accepted, but not one so high as to put extra money at risk.

A seller may also require ongoing, periodic earnest deposits to have a prospective buyer continue to show good faith during their due diligence process. For example, a seller may require a buyer to make monthly earnest deposits on a fixed schedule over a three month due diligence period. Should the buyer fail to meet any earnest money deposit requirements, the seller may be entitled to bring the property back to market and potentially recover losses via keeping portions of the earnest money.

How Is Earnest Money Paid?

Earnest money is usually paid by certified check, personal check, or a wire transfer into a trust or escrow account that is held by a real estate brokerage, legal firm, or title company. The funds are held in the account until closing, when they are applied toward the buyer's down payment and closing costs.

It's important to note that escrow accounts, like any other bank account, can earn interest. If the earnest funds in the escrow account earn interest of more than $600, the buyer must fill out tax form W-9 with the IRS to receive the interest.1

Is Earnest Money Refundable?

Earnest money isn't always refundable. The good news for buyers is in most situations, as long as a buyer acts in good faith, earnest money is refundable. As long as any contract agreements are not broken or decision deadlines are met, buyers usually get their earnest money back. Specific conditions where buyers often get their earnest money back include:

  • If a home inspection reveals there are material issues with a property being sold. The buyer can usually choose to negotiate who is responsible for the repairs or can back out of the purchase.
  • If a home appraises for lower value than the agreed purchase price. The buyer can negotiate a lower purchase price or can back out of the purchase price.
  • If a buyer is unable to sell their current house (as long as this home sale contingency is agreed upon).
  • If a buyer is unable to obtain a loan/financing (as long as this funding contingency is agreed upon).

Every situation is different, but broadly speaking, the seller gets to keep the earnest money if the buyer decides not to go through with the home purchase for reasons not specified as part of the contract. For example, if a buyer simply has a change of heart decides not to buy the property, the seller is most likely entitled to retain earnest money proceeds.

Protecting Your Earnest Money Deposit

Prospective buyers can do several things to protect their earnest money deposits.

    • Make sure contingencies for financing and inspections are included in the contract. Without these, the deposit could be forfeited if the buyer can't get financing or a serious defect is found during the inspection.
    • Ensure contract terms are in writing. The contract agreement between a buyer and seller should be in writing. This clarifies any misunderstandings and sets the precedence for terms of the agreement. Amendments to the contract are always allowable, but ensure that every iteration of the agreement is in writing and signed by both parties.
    • Read, understand, and abide by the terms of the contract. For example, if the contract states the home inspection must be completed by a certain date, the buyer must meet that deadline or risk losing the deposit—and the house.
    • Utilize an escrow account to hold funds. Do not send escrow money directly to the seller; if the funds are in direct possession by the other party, they can control the funds and not release funds even if you are entitled to earnest money refunds.
  • Make sure the deposit is handled appropriately. The deposit should be payable to a reputable third party, such as a well-known real estate brokerage, escrow company, title company, or legal firm (never give the deposit directly to the seller). Buyers should verify the funds will be held in an escrow account and always obtain a receipt. 

Example of Earnest Money

Suppose Tom wants to buy a home worth $100,000 from Joy. To facilitate the transaction, the broker arranges to deposit $10,000 as a deposit in an escrow account. The terms of the subsequent agreement signed by both parties state that Joy, who is currently living in the home, will move out of it within the next six months.

However, Joy is unable to find another place of residence by moving day. As a result, Tom cancels the transaction and gets his deposit money back. The deposit money has earned interest of $500 from the escrow account during this time period. Since the amount is less than $600, Tom is not required to fill out an IRS form to retrieve the amount.1

What Is an Earnest Money Payment?

In real estate, earnest money is effectively a deposit to buy a home. Usually, it ranges between 1-10% of the home's sale price. While earnest money doesn't obligate a buyer to purchase a home, it does require the seller to take the property off of the market during the appraisal process. Earnest money is deposited to represent good faith in purchasing the home.

Who Keeps Earnest Money If a Deal Falls Through?

Earnest money gets returned if something goes awry during the appraisal that was predetermined in the contract. This could include an appraisal price that is lower than the sale price, or if there is a significant flaw with the house. Importantly, though, earnest money may not be returned if the flaw was not predetermined in the contract or if the buyer decides not to purchase the house during an agreed-upon time period. 

How Can Earnest Money Be Protected?

To protect an earnest money deposit, prospective buyers can follow a number of precautionary steps. First, buyers can ensure that contingencies apply to defects, financing, and inspections. This protects the deposit from being forfeited in the case that a major flaw is discovered, or that financing is not secured. Second, carefully read and follow the terms of the contract. In some cases, the contract will indicate a certain date by which the inspection must be made. To prevent forfeiture, the buyer should abide by these terms accordingly. Finally, ensure the deposit is handled adequately, which means that the buyer should work with a reputable broker, title firm, escrow company, or legal firm. 

Do You Get Earnest Money Back?

As long as a buyer follows the terms of the contract and adheres to all deadlines agreed to with the seller, a buyer will most often receive their full earnest money deposit(s) back. Should the buyer fail to comply with the agreement, the seller may be entitled to receive some or all earnest deposit funds.

How Do You Lose Earnest Money?

In an agreement between a buyer and seller, there are often a number of contingencies outlined that spell out the terms where a buyer may back out of an agreement. These contingencies include failure of a home inspection, failure to secure financing, or failure to sell a separate existing property.

If the buyer decides to not proceed with the sale for reasons outside of these agreed to contingencies, the buyer is at risk of losing earnest money.

The Bottom Line

When a buyer and seller enter into an initial agreement to transfer ownership right of property, the buyer is often required to make a deposit of earnest money into an escrow account. There's a number of reasons the buyer and seller can agree to where the buyer can back out of the agreement. However, should the buyer break contract or not meet required deadlines, the seller may be entitled to keep the earnest money as compensation for the break of good faith.

December
19

Deciding how to price your home is one of the biggest challenges sellers face. Here's how to price it right.

Deciding how to price your home is one of the biggest challenges sellers face, and everyone has an opinion. Asking for the right price is important — go too high, and your home will sit on the market. Price your house too low, and it may cost you. In order to keep your listing in line with the market, our real estate agents always recommend using facts and data to support your asking price. You definitely want to steer clear of the following pricing myths:

  • Myth: You Should Always Ask For More Than You Paid
    While it's true home values appreciate over time, your final sale price will be largely determined by the current state of the market, the value of your home, and what buyers are willing to pay for it. Certain macroeconomic factors, property damage, or even changes to your neighborhood may cause your home value to decline. While you ideally want to earn a profit on your home sale, in some cases it may not always be possible. 

  • Click Here to Read More...

December
16

Mortgage and refinance rates today, Dec. 15, 2022

Today's mortgage and refinance rates

Average mortgage rates just inched higher yesterday. That was a wonderful surprise because I'd feared a much sharper increase.

Mortgage rates today were barely moving by approaching 10 a.m. (ET). But there may be grounds for hoping for falls later as economic news this morning fell short of expectation.

Find your lowest rate. Start here (Dec 16th, 2022)

Current mortgage and refinance rates

Program Mortgage Rate APR* Change
Conventional 30 year fixed 6.241% 6.274% Unchanged
Conventional 15 year fixed 5.568% 5.625% -0.06% 
Conventional 20 year fixed 6.086% 6.14% Unchanged
Conventional 10 year fixed 5.829% 5.949% +0.01% 
30 year fixed FHA 6.129% 6.872% -0.02% 
15 year fixed FHA 5.68% 6.173% -0.07% 
30 year fixed VA 5.832% 6.06% -0.04% 
15 year fixed VA 5.947% 6.303% -0.05% 
Rates are provided by our partner network, and may not reflect the market. Your rate might be different. Click here for a personalized rate quote. See our rate assumptions here.

Should you lock a mortgage rate today?

Don't lock on a day when mortgage rates look set to fall. My recommendations (below) are intended to give longer-term suggestions about the overall direction of those rates. So, they don't change daily to reflect fleeting sentiments in volatile markets.

Yesterday's Federal Reserve activities didn't bring the sharp increase in mortgage rates that I feared. The danger isn't quite over yet because sometimes markets have delayed reactions to such events. But, if things remain positive into next week, I may be able to reinstate some green "float" recommendations in the following list.

But, for now, my personal rate lock recommendations for the longer term remain:

  • LOCK if closing in 7 days
  • LOCK if closing in 15 days
  • LOCK if closing in 30 days
  • LOCK if closing in 45 days
  • LOCK if closing in 60 days

>Related: 7 Tips to get the best refinance rate

Market data affecting today's mortgage rates

Here's a snapshot of the state of play this morning at about 9:50 a.m. (ET). The data, compared with roughly the same time yesterday, were:

  • The yield on 10-year Treasury notes fell to 3.46% from 3.50%. (Good for mortgage rates.) However, those yields were rising this morning. More than any other market, mortgage rates typically tend to follow these particular Treasury bond yields
  • Major stock indexes were appreciably lower soon after opening. (Sometimes good for mortgage rates.) When investors buy shares, they're often selling bonds, which pushes those prices down and increases yields and mortgage rates. The opposite may happen when indexes are lower. But this is an imperfect relationship
  • Oil prices inched down to $76.75 from $76.87 a barrel. (Neutral for mortgage rates*.) Energy prices play a prominent role in creating inflation and also point to future economic activity
  • Gold prices decreased to $1,794 from $1,823 an ounce. (Bad for mortgage rates*.) It is generally better for rates when gold rises and worse when gold falls. Gold tends to rise when investors worry about the economy.
  • CNN Business Fear & Greed index — tumbled to 55 from 68 out of 100. (Good for mortgage rates.) "Greedy" investors push bond prices down (and interest rates up) as they leave the bond market and move into stocks, while "fearful" investors do the opposite. So lower readings are better than higher ones

*A movement of less than $20 on gold prices or 40 cents on oil ones is a change of 1% or less. So we only count meaningful differences as good or bad for mortgage rates.

Caveats about markets and rates

Before the pandemic and the Federal Reserve's interventions in the mortgage market, you could look at the above figures and make a pretty good guess about what would happen to mortgage rates that day. But that's no longer the case. We still make daily calls. And are usually right. But our record for accuracy won't achieve its former high levels until things settle down.

So, use markets only as a rough guide. Because they have to be exceptionally strong or weak to rely on them. But, with that caveat, mortgage rates today were close to steady earlier. However, be aware that "intraday swings" (when rates change speed or direction during the day) are a common feature right now.

Find your lowest rate. Start here (Dec 16th, 2022)

Important notes on today's mortgage rates

Here are some things you need to know:

  1. Typically, mortgage rates go up when the economy's doing well and down when it's in trouble. But there are exceptions. Read 'How mortgage rates are determined and why you should care'
  2. Only "top-tier" borrowers (with stellar credit scores, big down payments and very healthy finances) get the ultralow mortgage rates you'll see advertised
  3. Lenders vary. Yours may or may not follow the crowd when it comes to daily rate movements — though they all usually follow the broader trend over time
  4. When daily rate changes are small, some lenders will adjust closing costs and leave their rate cards the same
  5. Refinance rates are typically close to those for purchases.

A lot is going on at the moment. And nobody can claim to know with certainty what will happen to mortgage rates in the coming hours, days, weeks or months.

Are mortgage and refinance rates rising or falling?

Yesterday

Yesterday's Federal Reserve events played out pretty much as expected. It hiked the federal funds rate by 50 basis points (0.5%). And the "dot plot" (future rate forecasts) in its summary of economic projections (SEP) showed rates staying higher for longer than previously expected.

That was the recipe that I thought would deliver significantly higher mortgage rates. But it didn't. So, what else played a part?

Well, it seems to have been Fed Chair Jerome Powell's news conference 30 minutes after the SEP was published. Because, according to the Fed's transcript, he said:

" … these [dot plot] projections do not represent a Committee decision or plan, and no one knows with any certainty where the economy will be a year or more from now. Our decisions will depend on the totality of incoming data and their implications for the outlook for economic activity and inflation. And we will continue to make our decisions meeting by meeting and communicate our thinking as clearly as possible."

In other words, Mr. Powell told markets effectively to take the dot plot with a shovelful of salt. And that seemed to be enough to turn them around as investors were persuaded that the day's Fed news wasn't so bad after all.

There remains a question mark about whether this belief sticks. It often takes markets hours or days for them to reflect fully on a new situation. And we can't yet rule out a late rise in mortgage rates as investors mull over what's really happening.

However, I'm hopeful (something I've written rarely this year) that we won't see the sharp rise in mortgage rates I feared yesterday morning. Still, I shouldn't be surprised if they drifted somewhat higher over the next few months.

Today's economic data

This morning's economic reports for November were disappointing, something that could help mortgage rates. Economists and analysts polled by MarketWatch had expected retail sales to fall by 0.3% that month, but the actual figure was -0.6%. Meanwhile, industrial production and capacity utilization for the same month also fell slightly short of expectations.

As I repeat daily, mortgage rates tend to fall when the economy's in trouble and rise when it's doing well. So today could turn out to be a good one for those rates.

For more background, please read the latest weekend edition of this report.

According to Freddie Mac's archives, the weekly all-time low for mortgage rates was set on Jan. 7, 2021, when it stood at 2.65% for conventional, 30-year, fixed-rate mortgages.

Freddie's Dec. 8 report put that same weekly average at 6.33%, down from the previous week's 6.49%.

Recently, Freddie stopped including discount points in its forecasts. It has also moved later in the day the time at which it publishes its Thursday reports. And, from now on, we'll be updating this section on Fridays.

Expert mortgage rate forecasts

Looking further ahead, Fannie Mae, Freddie Mac and the Mortgage Bankers Association (MBA) each has a team of economists dedicated to monitoring and forecasting what will happen to the economy, the housing sector and mortgage rates.

And here are their rate forecasts for the current quarter (Q4/22) and the first three quarters of next year (Q1/23, Q2/23 and Q3/24).

The numbers in the table below are for 30-year, fixed-rate mortgages. Fannie's forecast appeared on Nov. 22, the MBA's on Nov. 23 and Freddie's on Oct. 21. Freddie now publishes its forecasts quarterly and its figures can quickly become stale.

Forecaster Q4/22 Q1/23 Q2/23 Q3/23
Fannie Mae 7.0% 7.0%  6.9% 6.7%
Freddie Mac 6.8% 6.6%  6.5% 6.4%
MBA 6.7% 6.2%  5.6% 5.4%

Of course, given so many unknowables, the whole current crop of forecasts might be even more speculative than usual. And their past record for accuracy hasn't been wildly impressive.

Find your lowest rate today

You should comparison shop widely, no matter what sort of mortgage you want. As federal regulator the Consumer Financial Protection Bureau says:

"Shopping around for your mortgage has the potential to lead to real savings. It may not sound like much, but saving even a quarter of a point in interest on your mortgage saves you thousands of dollars over the life of your loan."

Verify your new rate (Dec 16th, 2022)

Mortgage rate methodology

The Mortgage Reports receives rates based on selected criteria from multiple lending partners each day. We arrive at an average rate and APR for each loan type to display in our chart. Because we average an array of rates, it gives you a better idea of what you might find in the marketplace. Furthermore, we average rates for the same loan types. For example, FHA fixed with FHA fixed. The end result is a good snapshot of daily rates and how they change over time.

December
9

Finding the Perfect Spot for the Christmas Tree

You have trekked out to the tree farm and picked out the perfect Christmas tree, or maybe you've dragged the box containing your tree down from the attic. If you've moved, or if you've simply moved furniture, since last year, you might be in a quandary: Where is the best place to put the Christmas tree? You want to find a place where it won't get in the way, but where it can be enjoyed easily by all. Here are a few tips on finding the perfect spot to put your Christmas tree:

Put it near an electric outlet

You'll need to plug in your lights, and you don't want to have to step over wires or run them under a rug. You also shouldn't overload your circuits; if you already have a power strip plugged into a wall outlet, you might not want to add tree lights in addition. Finding a spot near a free electric outlet might require that you move other electrical appliances, so think about this before you choose where to put your tree.

Don't block anything essential

If family members are squeezing by the tree in order to open or close a door, get to an often-used bookcase or leave the room, then at some point, some ornaments are likely to be knocked off and broken. Make sure that you can walk easily past the tree and that you don't have to reach over or around it for something that you will need more than a couple of times throughout the holiday season.

On the other hand, you can block features that you rarely use

Do you have antique encyclopedias and your grandmother's old doll collection displayed on shelves? Blocking something like that, which you don't have any need to access for the month or so that the tree will be up, is okay. If it's distracting, you could even hang a red or white sheet as a backdrop to cover the display and provide a blank backdrop for your tree.

Think about needle drop if you have a real tree

Real Christmas trees are lovely and smell great, but they also drop needles. If you have carpet, you will want to think ahead to how you are going to get the tree out of the room while minimizing the mess of dropped needles as much as possible. Placing it behind a couch or up a short flight of stairs could prove frustrating when you're vacuuming after the New Year. On the other hand, you might decide that a pile of tree needles is a small price to pay for having your tree in a perfect location!

Keep fire safety rules in mind

It should go without saying that your tree must not be placed in front of a fireplace or wood stove that is in use. You might not realize, though, that it also shouldn't be placed near a radiator, and that if it's a real tree, you have to keep it well-watered, particularly for the first week that you have it, to reduce the risk of fire.

Finding the perfect spot for your Christmas tree can take some thought and special consideration, but it will be worth it when you are able to enjoy your tree all season long. If you move furniture in order to accommodate your tree, make sure that you take a photo or draw a diagram to remind yourself for next year!
December
7

Mortgage and refinance rates today, Dec. 6, 2022

Today's mortgage and refinance rates

Average mortgage rates barely moved yesterday. That's good news since they're close to two-month lows.

This morning, it's looking as if mortgage rates today might hold steady or close to steady. But that could change later in the day.

Find your lowest rate. Start here (Dec 7th, 2022)

Current mortgage and refinance rates

Program Mortgage Rate APR* Change
Conventional 30 year fixed 6.349% 6.383% -0.04% 
Conventional 15 year fixed 5.701% 5.758% +0.16% 
Conventional 20 year fixed 6.206% 6.264% +0.17% 
Conventional 10 year fixed 5.979% 6.098% +0.23% 
30 year fixed FHA 6.209% 6.954% +0.04% 
15 year fixed FHA 5.84% 6.336% +0.1% 
30 year fixed VA 6.027% 6.257% Unchanged
15 year fixed VA 6.229% 6.588% +0.16% 
Rates are provided by our partner network, and may not reflect the market. Your rate might be different. Click here for a personalized rate quote. See our rate assumptions here.

Should you lock a mortgage rate today?

Don't lock on a day when mortgage rates look set to fall. My recommendations (below) are intended to give longer-term suggestions about the overall direction of those rates. So, they don't change daily to reflect fleeting sentiments in volatile markets.

I fear that the next important Federal Reserve meeting, on Dec. 14, will begin to push mortgage rates higher again.

So, my personal rate lock recommendations for the longer term must for now remain:

  • LOCK if closing in 7 days
  • LOCK if closing in 15 days
  • LOCK if closing in 30 days
  • LOCK if closing in 45 days
  • LOCK if closing in 60 days

Market data affecting today's mortgage rates

Here's a snapshot of the state of play this morning at about 9:50 a.m. (ET). The data, compared with roughly the same time yesterday, were:

  • The yield on 10-year Treasury notes held steady at 3.57%. (Neutral for mortgage rates.) However, those yields were rising this morning. More than any other market, mortgage rates typically tend to follow these particular Treasury bond yields
  • Major stock indexes were barely moving soon after opening. (Neutral for mortgage rates.) When investors buy shares, they're often selling bonds, which pushes those prices down and increases yields and mortgage rates. The opposite may happen when indexes are lower. But this is an imperfect relationship
  • Oil prices tumbled to $76.70 from $82.15 a barrel. (Good for mortgage rates*.) Energy prices play a prominent role in creating inflation and also point to future economic activity
  • Gold prices decreased to $1,790 from $1,800 an ounce. (Neutral for mortgage rates*.) It is generally better for rates when gold rises and worse when gold falls. Gold tends to rise when investors worry about the economy.
  • CNN Business Fear & Greed index — fell to 64 from 69 out of 100. (Good for mortgage rates.) "Greedy" investors push bond prices down (and interest rates up) as they leave the bond market and move into stocks, while "fearful" investors do the opposite. So lower readings are better than higher ones

*A movement of less than $20 on gold prices or 40 cents on oil ones is a change of 1% or less. So we only count meaningful differences as good or bad for mortgage rates.

Caveats about markets and rates

Before the pandemic and the Federal Reserve's interventions in the mortgage market, you could look at the above figures and make a pretty good guess about what would happen to mortgage rates that day. But that's no longer the case. We still make daily calls. And are usually right. But our record for accuracy won't achieve its former high levels until things settle down.

So, use markets only as a rough guide. Because they have to be exceptionally strong or weak to rely on them. But, with that caveat, mortgage rates today look likely to be unchanged or barely changed. However, be aware that "intraday swings" (when rates change speed or direction during the day) are a common feature right now.

Find your lowest rate. Start here (Dec 7th, 2022)

Important notes on today's mortgage rates

Here are some things you need to know:

  1. Typically, mortgage rates go up when the economy's doing well and down when it's in trouble. But there are exceptions. Read 'How mortgage rates are determined and why you should care'
  2. Only "top-tier" borrowers (with stellar credit scores, big down payments and very healthy finances) get the ultralow mortgage rates you'll see advertised
  3. Lenders vary. Yours may or may not follow the crowd when it comes to daily rate movements — though they all usually follow the broader trend over time
  4. When daily rate changes are small, some lenders will adjust closing costs and leave their rate cards the same
  5. Refinance rates are typically close to those for purchases.

A lot is going on at the moment. And nobody can claim to know with certainty what will happen to mortgage rates in the coming hours, days, weeks or months.

Are mortgage and refinance rates rising or falling?

Dec. 14 will see the close of a two-day meeting of the Federal Reserve's monetary policy committee. And the Federal Open Market Committee (FOMC) will be publishing its dot plot that day.

That dot plot lays out in graphic form the personal interest rate predictions of each FOMC member. And it may prove a moment of truth for markets.

Because many investors have persuaded themselves that the Fed is on the brink of slowing and soon reversing its rate hikes. And that belief was behind the significant falls in mortgage rates we saw on Nov. 10 and Dec. 1.

Higher-than-expected rates next year?

But their grounds for believing that are decidedly shaky. Indeed, the Fed itself has repeatedly warned that it's planning several rate hikes in the first few months of 2023. And at least one leading FOMC member has said that he's revising upward his forecast of that year's peak rate.

That sentiment was reflected overnight in The Wall Street Journal's (paywall) lead story. It began: "Federal Reserve officials have signaled plans to raise their benchmark interest rate by 0.5 percentage point at their meeting next week, but elevated wage pressures could lead them to continue lifting it to higher levels than investors currently expect."

I fear that the FOMC's report and news conference on Dec. 14 might act as a bucket of cold water on market optimism. And, if it does, that will likely see mortgage rates rise. I and others wouldn't be surprised to see them back up in the 7% range by the year's end or soon after.

Indeed, as Dec. 14 looms, some investors may begin to ask themselves how confident they are in their beliefs. And any doubts could alone push mortgage rates higher before the FOMC meeting.

Of course, none of this is certain. But it does look like a credible scenario to me.

For more background, please read the latest weekend edition of this report. It includes my reasons for thinking mortgage rates might move higher again soon.

According to Freddie Mac's archives, the weekly all-time low for mortgage rates was set on Jan. 7, 2021, when it stood at 2.65% for conventional, 30-year, fixed-rate mortgages.

Freddie's Dec. 1 report put that same weekly average at 6.49%, down from the previous week's 6.58%.

Recently, Freddie stopped including discount points in its forecasts. It has also moved later in the day the time at which it publishes its Thursday reports. And, from now on, we'll be updating this section on Fridays.

Expert mortgage rate forecasts

Looking further ahead, Fannie Mae, Freddie Mac and the Mortgage Bankers Association (MBA) each has a team of economists dedicated to monitoring and forecasting what will happen to the economy, the housing sector and mortgage rates.

And here are their rate forecasts for the current quarter (Q4/22) and the first three quarters of next year (Q1/23, Q2/23 and Q3/24).

The numbers in the table below are for 30-year, fixed-rate mortgages. Fannie's forecast appeared on Nov. 22, the MBA's on Nov. 23 and Freddie's on Oct. 21. Freddie now publishes its forecasts quarterly and its figures can quickly become stale.

Forecaster Q4/22 Q1/23 Q2/23 Q3/23
Fannie Mae 7.0% 7.0%  6.9% 6.7%
Freddie Mac 6.8% 6.6%  6.5% 6.4%
MBA 6.7% 6.2%  5.6% 5.4%

Of course, given so many unknowables, the whole current crop of forecasts might be even more speculative than usual. And their past record for accuracy hasn't been wildly impressive.

Find your lowest rate today

You should comparison shop widely, no matter what sort of mortgage you want. As federal regulator the Consumer Financial Protection Bureau says:

"Shopping around for your mortgage has the potential to lead to real savings. It may not sound like much, but saving even a quarter of a point in interest on your mortgage saves you thousands of dollars over the life of your loan."

Verify your new rate (Dec 7th, 2022)

Mortgage rate methodology

The Mortgage Reports receives rates based on selected criteria from multiple lending partners each day. We arrive at an average rate and APR for each loan type to display in our chart. Because we average an array of rates, it gives you a better idea of what you might find in the marketplace. Furthermore, we average rates for the same loan types. For example, FHA fixed with FHA fixed. The end result is a good snapshot of daily rates and how they change over time.

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