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Fixed Mortgage Rates Decline The First Week of 2016

Fixed mortgage rates on both conforming and jumbo mortgages declined during the first week of 2016. Average 30 year conforming rates are at 3.81 percent, down from last week's average rate of 3.900 percent. Average 30 year jumbo mortgage rates are currently at 4.39 percent, a decline from the prior week's average of 4.44 percent.

The declines may be short lived since a very strong jobs report released Friday morning is likely to send mortgage rates higher next week. Economists were looking for 200,000 jobs being created in December and the number came in at 292,000.

Fixed Mortgage Rates Decline The First Week of 2016The stronger jobs number will make it more likely the Federal Reserve will increase the fed funds rate when they meet this month. Last month the Fed increased the fed funds rate for the first time in almost a decade. The last time there were back-to-back monthly increases in the rate were May and June of 2006.

While there isn't a direct connection between a higher fed funds rate and higher mortgage rates, both typically move in the same direction. The direction of mortgage rates in the coming years will be higher but rates are currently low by historic standards.

In fact, current average 30 year conforming rates at 3.81 percent are a really good deal. Looking back at Freddie Mac's Primary Mortgage Market Survey in January 1982, average 30 year rates were at 17.48 percent. The all-time low for 30 year rates in the PMMS survey was at 3.35 percent in December 2012.

You can check for current rates in your state by searching our rate database at

Author: Brian McKay
January 9th, 2016