Mortgage Rates Sharply Higher This Week as Fed’s Fisher Talks of Ending Quantitative Easing

Follow by Email
Facebook
Twitter
LinkedIn
Mortgage rates are on a tear, increasing rather dramatically from record lows set just a month ago. The increase in average mortgage rates this week was the sharpest increases in months for fixed conventional rates. 30 year rates are now averaging 4.16 percent, an increase of 28 basis points week over week and 15 year rates are now at 3.32 percent, an increase 29 basis points week over week.

The latest news that is sending bond yields higher and in turn mortgage rates higher, is that the Federal Reserve is poised to evaluate and possibly make changes to their purchasing bonds and mortgage backed securities. The Federal Reserve forced mortgage interest rates down to record lows by dropping the fed funds rate to near zero percent and buying $2.5 trillion in bonds to help mitigate the effects of the financial crisis on the economy and housing.
Loan Type
Purchase    Refinance
Location
State/City    Zip Code
Loan Amt Points FICO % Down
  
$
30 yr fixed refi in 06101, All points, Credit score: 740+     Sort by:
Lender
APR
Rate
Cost & Fees
Notes
 
30 yr fixed Mortgage Loan from Better.com
Better.com
https://www.brimg.net/system/img/inst/9722_logo.gif
300000
Refinance
4.125
4.125
USD
Better.com Logo
NMLS # 330511
State Lic # ML-330511
at 0.000 pts
30 day lock rate
Est payment: $1,453.95
Fees in APR: None
Thank you for your quote. 
 
30 yr fixed mtg refi Mortgage Loan from Bank of America
Bank of America
300000
Refinance
4.365
4.250
USD
Bank of America
4.365%
4/15/2019
4.250%
at 0.903 pts
60 day lock rate
Est payment: $1,475.82
Fees in APR: $1,351
 
 
30 yr fixed mtg refi Mortgage Loan from Savings Bank of Danbury
Savings Bank of Danbury
300000
Refinance
4.397
4.375
USD
Savings Bank of Danbury
4.397%
4/19/2019
4.375%
at 0.000 pts
60 day lock rate
Est payment: $1,497.86
Fees in APR: $790
 
 
30 yr fixed mtg refi Mortgage Loan from First National Bank of Omaha
First National Bank of Omaha
300000
Refinance
4.575
4.500
USD
First National Bank of Omaha
4.575%
4/19/2019
4.500%
at 0.625 pts
60 day lock rate
Est payment: $1,520.06
Fees in APR: $752
 
 
30 yr fixed mtg refi Mortgage Loan from TD Bank, NA
TD Bank, NA
300000
Refinance
4.154
4.125
USD
TD Bank, NA
4.154%
4/16/2019
4.125%
at 0.000 pts
45 day lock rate
Est payment: $1,453.95
Fees in APR: $1,043
 
 
30 yr fixed mtg refi Mortgage Loan from Citizens Bank, NA
Citizens Bank, NA
300000
Refinance
4.403
4.375
USD
Citizens Bank, NA
4.403%
4/19/2019
4.375%
at 0.000 pts
60 day lock rate
Est payment: $1,497.86
Fees in APR: $998
 
 
30 yr fixed mtg refi Mortgage Loan from The Washington Trust Company
The Washington Trust Company
300000
Refinance
4.155
4.125
USD
The Washington Trust Company
4.155%
4/16/2019
4.125%
at 0.000 pts
30 day lock rate
Est payment: $1,453.95
Fees in APR: $1,083
 
 
30 yr fixed mtg refi Mortgage Loan from Santander Bank, N.A.
Santander Bank, N.A.
300000
Refinance
4.557
4.500
USD
Santander Bank, N.A.
4.557%
4/19/2019
4.500%
at 0.000 pts
60 day lock rate
Est payment: $1,520.06
Fees in APR: $2,004
 
 
30 yr fixed mtg refi Mortgage Loan from LincolnWay Community Bank
LincolnWay Community Bank
300000
Refinance
4.155
4.125
USD
LincolnWay Community Bank
4.155%
4/16/2019
4.125%
at 0.000 pts
30 day lock rate
Est payment: $1,453.95
Fees in APR: $1,085
 
 
30 yr fixed mtg refi Mortgage Loan from The Guilford Savings Bank
The Guilford Savings Bank
300000
Refinance
4.291
4.250
USD
The Guilford Savings Bank
4.291%
4/19/2019
4.250%
at 0.250 pts
60 day lock rate
Est payment: $1,475.82
Fees in APR: $719
 
 
30 yr fixed mtg refi Mortgage Loan from Liberty Bank
Liberty Bank
300000
Refinance
4.169
4.125
USD
Liberty Bank
4.169%
4/19/2019
4.125%
at 0.250 pts
60 day lock rate
Est payment: $1,453.95
Fees in APR: $814
 
 
30 yr fixed mtg refi Mortgage Loan from UniBank for Savings
UniBank for Savings
300000
Refinance
4.536
4.500
USD
UniBank for Savings
4.536%
4/19/2019
4.500%
at 0.250 pts
60 day lock rate
Est payment: $1,520.06
Fees in APR: $500
 
 
30 yr fixed mtg refi Mortgage Loan from Union Savings Bank
Union Savings Bank
300000
Refinance
4.399
4.375
USD
Union Savings Bank
4.399%
4/12/2019
4.375%
at 0.000 pts
60 day lock rate
Est payment: $1,497.86
Fees in APR: $852
 
 
30 yr fixed mtg refi Mortgage Loan from United Bank
United Bank
300000
Refinance
4.276
4.250
USD
United Bank
4.276%
4/16/2019
4.250%
at 0.000 pts
30 day lock rate
Est payment: $1,475.82
Fees in APR: $911
 
 

Mortage Data Provided by Bankrate.com Many lenders have different rates on their own Websites than those posted on Bankrate.com. In order to get the Bankrate.com rate, please identify yourself as a Bankrate.com customer. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the lender you choose, please click here.

The rates above were collected by Bankrate.com on the dates specified. Rates are subject to change without notice and may vary from branch to branch. Rate/APR and terms may vary based on the creditworthiness of the individual and the extent to which the loan differs from the one used for Bankrate.com quotes. For criteria used in surveys of rates above, click here. These quotes are from banks, thrifts, and brokers, some of whom have paid for a link to their own Web site, where you can find additional information.





When Will Quantitative Easing (QE) End?


dallas_fisherThe Federal Reserve is currently buying $85 billion a month in bonds and mortgage backed securities but if the president of the Dallas Federal Reserve Bank, Richard Fisher, had his way, the purchases would end sooner than later. In remarks for the C.D. Howe Institute Directors' Dinner in Toronto, Fisher said the following:
Act IV, just beginning, will involve the drama of introspection, with the FOMC evaluating the utility of its navigational tactics, and, perhaps, fine-tuning them, if not altering the course. Only time will reveal the efficacy of current policy and whether the risks that I and more experienced observers like Paul Volcker fret over are as substantial as we surmise, or whether we have made much ado about nothing.

Fisher has been a more vocal critic of quantitative easing and the future effects the easing will cause on inflation. Fisher, who isn't a voting member of the committee this year was against the QE3 due to his concern about the effects it will cause on future inflation. When the Fed will actually end QE3 is still up in the air but Fed Chairman, Ben Bernanke, and the majority of voting members are not as concerned as Fisher is about ending the easing.

Next Federal Open Market Committee Meeting (FOMC) June 18-19


We will be able to glean more about what the FOMC will do about easing this month as the next meeting is scheduled to take place June 18-19. The Fed has already stated they plan to keep the fed funds rate at near zero percent until the nation's unemployment rate falls below 6.5 percent. The rate in April was 7.5 percent.

There won't be any changes to the fed funds rate or quantitative easing in the June meeting but the Fed might say they plan to slow purchases or even set a date for ending easing. If either of these happens, you can expect current mortgage rates to move even higher from these levels.

Current Mortgage Rates Still Low, Historically Speaking


30 year mortgage rates today at 4.16 percent on average are still low historically speaking, even though rates are almost up 100 basis points from the record low set earlier this year. Plus there are lenders offering 30 year rates below 4.00 percent if you're willing to pay points on a loan. The same is true for 15 year rates, there are lenders quoting rates as low as 2.50 percent with points.

30 year jumbo mortgage rates are averaging 4.24 percent, an increase from the prior week's average 30 year jumbo mortgage rate of 4.10 percent. Average 15 year jumbo rates are at 3.66 percent, an increase from the prior week's average rate of 3.49 percent.

Higher Refinance Rates Kill Demand for Refinancing Mortgages


In the last four consecutive Weekly Application Surveys released by the Mortgage Bankers Association, refinance application loan demand has dropped as refinance rates have increased. In the survey released May 29, the MBA's Refinance Index dropped 12 percent, the biggest drop this year and the index is at the lowest point since December of 2012.

Although rates are higher this month, if you're thinking about buying a home, now is probably the best time ever. Home prices are still low. In many markets, home prices are still down 40 percent to 50 percent from the bubble peak back in 2006. Today's mortgage rates are higher but are still low by historical standards. Back in the early 1980's, 30 year conforming rates were as high as 17 percent, so a 4 percent 30 year mortgage rate today is still low.

You can search for and compare mortgage rates here: mortgagerates.monitorbankrates.com.
 
Author: Brian McKay
June 5th, 2013