Mortgage Rates Will Head Higher this Year and in 2015

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Mortgage rates are higher this week over last as 10 year U.S. Treasury yields declined. 30 year conforming mortgage rates today are averaging 4.50 percent, a decline from last week's average 30 year mortgage rate of 4.54 percent. Mortgage rates moved higher throughout 2013 and will continue to move higher in 2014 and 2015.

The lowest point for average 30 year rates in 2013 was back in the first week of January when rates hit a low of 3.34 percent. The lowest point ever for 30 year rates was the week of November 21, 2012, when rates hit a low of 3.21 percent. Rates moved higher from the all-time lows set late in 2012 but are still low, historically speaking.
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 Garden State Home Loans
Garden State Home Loans
https://www.brimg.net/system/img/inst/7950_logo.gif
300000
Refinance
3.956
3.874
USD
Garden State Home Loans Logo
NMLS # 473163
State Lic # ML-473163
(877) 387 - 9107
at 0.100 pts
30 day lock rate
Est payment: $1,410.54
Fees in APR: $2,685
Thanks for the inquiry! 
 
30 yr fixed Mortgage Loan from Sebonic Financial
Sebonic Financial
https://www.brimg.net/system/img/inst/8420_logo.gif
300000
Refinance
4.092
3.990
USD
Sebonic Financial Logo
NMLS # 66247
State Lic # ML-66247
(877) 388 - 9170
at 0.100 pts
30 day lock rate
Est payment: $1,430.52
Fees in APR: $3,350
Thank you for your inquiry, we will be in touch shortly. 
 
30 yr fixed Mortgage Loan from Sebonic Financial
Sebonic Financial
https://www.brimg.net/system/img/inst/8420_logo.gif
300000
Refinance
4.246
4.240
USD
Sebonic Financial Logo
NMLS # 66247
State Lic # ML-66247
(877) 388 - 9170
at 0.000 pts
30 day lock rate
Est payment: $1,474.06
Fees in APR: $206
Thank you for your inquiry, we will be in touch shortly. 
 
30 yr fixed Mortgage Loan from Garden State Home Loans
Garden State Home Loans
https://www.brimg.net/system/img/inst/7950_logo.gif
300000
Refinance
4.124
4.124
USD
Garden State Home Loans Logo
NMLS # 473163
State Lic # ML-473163
(877) 387 - 9107
at 0.000 pts
30 day lock rate
Est payment: $1,453.77
Fees in APR: None
Thanks for the inquiry! 
 
30 yr fixed Mortgage Loan from Garden State Home Loans
Garden State Home Loans
https://www.brimg.net/system/img/inst/7950_logo.gif
300000
Refinance
3.880
3.749
USD
Garden State Home Loans Logo
NMLS # 473163
State Lic # ML-473163
(877) 387 - 9107
at 1.100 pts
30 day lock rate
Est payment: $1,389.18
Fees in APR: $1,467
Thanks for the inquiry! 
 
30 yr fixed Mortgage Loan from Sebonic Financial
Sebonic Financial
https://www.brimg.net/system/img/inst/8420_logo.gif
300000
Refinance
3.926
3.740
USD
Sebonic Financial Logo
NMLS # 66247
State Lic # ML-66247
(877) 388 - 9170
at 1.100 pts
30 day lock rate
Est payment: $1,387.65
Fees in APR: $3,428
Thank you for your inquiry, we will be in touch shortly. 
 
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
 
 
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%
4/17/2019
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 The Guilford Savings Bank
The Guilford Savings Bank
300000
Refinance
4.166
4.125
USD
The Guilford Savings Bank
4.166%
4/12/2019
4.125%
at 0.250 pts
60 day lock rate
Est payment: $1,453.95
Fees in APR: $719
 
 
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%
4/12/2019
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 First National Bank of Omaha
First National Bank of Omaha
300000
Refinance
4.439
4.375
USD
First National Bank of Omaha
4.439%
4/11/2019
4.375%
at 0.500 pts
60 day lock rate
Est payment: $1,497.86
Fees in APR: $752
 
 
30 yr fixed mtg refi Mortgage Loan from Savings Bank of Danbury
Savings Bank of Danbury
300000
Refinance
4.272
4.250
USD
Savings Bank of Danbury
4.272%
4/12/2019
4.250%
at 0.000 pts
60 day lock rate
Est payment: $1,475.82
Fees in APR: $790
 
 
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 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 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 Liberty Bank
Liberty Bank
300000
Refinance
4.169
4.125
USD
Liberty Bank
4.169%
4/12/2019
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%
4/12/2019
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 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
 
 

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.






Current mortgage rates will continue to move higher over the next two years but take a look back at where rates have been.

30 Year Conforming Mortgage Rates Historical Perspective


Current 30 year rates have moved 1.25 percent higher from the record lows but when you compare current rates to the record highs, these rates are still incredibly low. Back in the early 1980's when inflation was in the double digits, 30 year mortgage rates were also in the double digits.

Looking back for historical perspective, the highest point ever recorded for 30 year rates in Freddie Mac's Primary Mortgage Market Survey was at an unbelievable high of 18.45 percent in October 1981. The monthly payments for a home loan with an 18.45 percent rate is much higher than the same loan amount at the current rate of 4.50 percent.

Using a mortgage calculator you can see the difference in this example:

  • A $500,000 loan for 30 years with a rate of 18.45 percent has a monthly payment of $7,719.27

  • A $500,000 loan for 30 years with a rate of 4.50 percent has a monthly payment of $2,533.43


In this example the monthly payment difference an astonishing $5,185.84.

Homes Are Less Affordable When Home Prices and Mortgage Rates Increase


After the housing bust and when mortgage rates hit record lows, home affordability was at its highest point ever according to the National Association of Realtors. This meant you could buy more home than you ever could before. Home affordability has since declined from the highs in 2012 and will continue to decline in the coming years.

As home prices increase and mortgage rates increase, you'll be able to buy less with your money. Therefore you should consider buying sooner than later. Freddie Mac has a Homebuyer Affordability tool you can use to see how higher mortgage rates and home prices affect homebuyer affordability.

Using the tool to forecast mortgage rates and home prices between Q3 2013 and Q3 2014, you can see the Affordability Index declining, which means for the same money, you'll be getting less and less.

Direction of Mortgage Rates in 2014


Mortgage interest rates are moving higher but rates won't be moving that high. Hopefully we will never see double-digit inflation and double-digit mortgage rates ever again. There are different forecasts for where average mortgage rates will be this year and next but the consensus is that rates are moving higher.

The Mortgage Bankers Association has forecasted average 30 year conforming mortgage rates increasing to 4.70 percent in the first quarter of 2014. By the end of 2014, the MBA has forecasted average 30 year rates to move above 5.00 percent to 5.10 percent.

We believe average 30 year conforming rates will move somewhat higher than the MBA forecast. By the summer of 2014, average 30 year rates will be near 5.00 percent and by the end of 2014, average 30 year rates will be around 5.30 percent. We believe rates will be higher because economic growth will be stronger and the unemployment rate will be lower than expected.

Average Mortgage Rates in 2015


Rates are expected to continue to move higher in 2015 but the year over year increase is expected to be even lower than the 2013/2014 increase. The MBA has forecasted for average 30 year rates to increase to 5.20 percent in the second quarter of 2015 and move to 5.30 percent by the end of 2015.

If the MBA's forecast is correct, average 30 year rates are expected to only move up 0.80 percent over the next two years. This is not much of an increase at all and 30 year rates around 5.30 are still low, historically. We believe by the summer of 2015 average 30 year rates will be around 5.50 percent and by the end of 2015 rates will be around 6.00 percent. 30 year rates at 6.00 percent are still low.

Mortgage Rates Decline This Week but Will Head Higher This year and in 2015Average Mortgage Rates January 08, 2014


15 year mortgage rates today are averaging 3.51 percent, a decline from last week's average 15 year mortgage rate of 3.57 percent. The average 15 year rate is at 3.51 percent but there are many lenders quoting 15 year rates below the average.

Right now in our database for the state of California we have lenders quoting 15 year refinance rates as low as 2.875 percent and 3.00 percent with mortgage points. The same lenders are also quoting 15 year refinance rates in other states as low.

30 year jumbo mortgage rates today are averaging 4.65 percent, higher than last week's average 30 year jumbo mortgage rate of 4.63 percent. Currently the lowest 30 year jumbo refinance rates in our database right now are quoted at 4.25 percent with no mortgage points for the state of Maryland.

15 year jumbo mortgage rates currently are averaging 3.88 percent, a slight decline from the previous week's average 15 year jumbo rate of 3.89 percent. Checking our database the lowest quoted 15 year jumbo refinancing rates today in the state of Oregon are at 3.375 percent with 2 points. The lowest 15 year refi rates without points are quoted at 3.75 percent.

Current 5/1 adjustable mortgage rates on conforming loans are at 3.67 percent, down from last week's average 5/1 adjustable mortgage rate of 3.69 percent. The best 5 year adjustable refinance rates quoted on our rate tables are much lower than the average. Checking on rates in South Carolina, we have lenders quoting 5 year rates at 2.25 percent with 2 points and at 2.75 percent with no points.

5 year jumbo adjustable mortgage rates are higher this week averaging 3.02 percent, up from last week's average 5 year conforming rate of 3.00 percent. The lowest 5 year adjustable jumbo refi rates in our database for the state of Florida are currently at 2.50 percent with 2 points and at 2.875 percent with no points.
 
Author: Brian McKay
January 8th, 2014