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Mortgage Rates Increase on Fed Tapering Fears

For the past couple of weeks we thought we were safe from higher mortgage rates but that isn't the case anymore. The fear that the Federal Reserve will start tapering bond and mortgage-backed security purchases are back. The Federal Open Market Committee (FOMC) just released their October meeting minutes, suggesting that the central bank is looking for a way to slow down and stop their buying.

Search for the Lowest Mortgage Rates Here: Mortgage Rates

The committee members did vote 9-to-1 to continue the $85 billion-per-month asset-purchase program, which will keep a lid on mortgage rates for now. What is stoking fears again is the minutes revealed some members believed an exit strategy should be decided upon and announced within the next few meetings.

Conforming Mortgage Rates Today

As a result of the news, 10 year bond rates soared higher on Wednesday and hit a high of 2.84 percent Thursday morning. The 15 basis point increase in 10 year bond yields this week has sent 30 year conventional mortgage rates up to 4.37 percent. If 10 year bond yields stay near current levels, 30 year mortgage rates will move back towards 4.45 percent.

Just yesterday Freddie Mae reported 30 year conforming rates fell to 4.22 percent. Next week's report will show average 30 year mortgage rates at 4.45 percent. Right now the best 30 year mortgage refinance rates in our database for California, rates are at 3.625 percent with 2 mortgage points. The lowest current rates in most other states are at 3.75 percent with points.

Mortgage rates today on 15 year conventional home loans are averaging 3.39 percent. Next week 15 year mortgage rates will move back towards 3.50 percent if 10 year bond rates stay above 2.75 percent. Currently, the lowest 15 year refinance rates in our database of rates are at 2.75 percent. The lowest 15 year refinancing rates without points are at 3.00 percent.

Current Jumbo Mortgage Rates Today

Current 30 year jumbo mortgage rates today are averaging 4.45 percent, an increase from yesterday's average 30 year jumbo mortgage rate of 4.39 percent. Next week 30 year jumbo rates will move back above 4.50 percent and possibly as high as 4.60 percent.

The best jumbo refinance rates today in our database on 30 year loans are much lower at 4.00 percent. The best 30 year jumbo refi rates without points are currently at 4.25 percent.

Today's mortgage rates on 15 year jumbo loans are averaging 3.84 percent, up from an average 15 year jumbo rate of 3.79 percent. This coming week, 15 year mortgage rates will move towards 3.90 percent on average.

Right now, the best jumbo rates on 15 year loans in our database are much lower at 3.125 percent with points. The lowest 15 year jumbo rate without points is still below the average at 3.50 percent.

Today's Adjustable Mortgage Rates

5/1 conforming adjustable mortgage rates are averaging 3.50 percent today, an increase from yesterday's average 5/1 mortgage rate of 3.44 percent. Next week 5/1 adjustable refinance rates will move towards 3.60 percent. Currently the lowest 5 year adjustable rate is lower at 2.25 percent with points. The lowest 5 year adjustable rate without points is at 2.49 percent.

Jumbo rates on 5/1 adjustable loans are averaging 2.80 percent, an increase from an average 5 year jumbo rates of 2.77 percent. This week 5 year jumbo rates will be higher, averaging around 2.90 percent. The lowest 5 year jumbo rates in our database with points are also at 2.125 percent and the lowest rate without points is at 2.49 percent.
Author: Brian McKay
November 22nd, 2013