30-year mortgage rate ticks up from record low

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The benchmark 30-year fixed-rate mortgage rose this week to 3.01 percent from 2.95 percent, according to Bankrate’s weekly survey of large lenders.

A year ago, it was 3.84 percent. Four weeks ago, the rate was 2.96 percent. The 30-year fixed-rate average for this week is 0.87 percentage points below the 52-week high of 3.88 percent, and is 0.06 percentage points above the 52-week low of 2.95 percent.

The 30-year fixed mortgages in this week’s survey had an average total of 0.32 discount and origination points.

Over the past 52 weeks, the 30-year fixed has averaged 3.33 percent. This week’s rate is 0.32 percentage points lower than the 52-week average.

  • The 15-year fixed-rate mortgage rose to 2.42 percent from 2.37 percent.
  • The 5/1 adjustable-rate mortgage fell to 2.83 percent from 2.87 percent.
  • The 30-year fixed-rate jumbo mortgage rose to 3.46 percent from 3.41 percent.

At the current 30-year fixed rate, you’ll pay $422.14 each month for every $100,000 you borrow, up from $418.91 last week.

At the current 15-year fixed rate, you’ll pay $663.03 each month for every $100,000 you borrow, up from $660.69 last week.

At the current 5/1 ARM rate, you’ll pay $412.49 each month for every $100,000 you borrow, down from $414.63 last week.

Results of Bankrate.com’s weekly national survey of large lenders conducted January 13, 2021 and the effect on monthly payments for a $165,000 loan:

Weekly national mortgage survey
Breakdown 30-year fixed 15-year fixed 5-year ARM
This week’s rate: 3.01% 2.42% 2.83%
Change from last week: +0.06 +0.05 -0.04
Monthly payment: $696.54 $1,094.00 $680.61
Change from last week: +$5.33 +$3.87 -$3.52

Where mortgage rates are headed

Mortgage experts were mixed on rate trend predictions in Bankrate’s survey this week (Jan. 14-20). Some 46 percent predicted a rate increase, 36 percent said rates would fall and 18 percent said they would remain the same

“Lower rates. COVID-19 is out of control. Folks are hunkering down. Layoffs will mount. Softening economy results,” said Jeff Lazerson,
president, MortgageGrader.

A refinance might be getting more urgent for millions of homeowners

Rates are up from a record low but they may be going up soon. The rate on 10-year bonds issued by the U.S. government has topped 1 percent for the first time since March for the last week. The 10-year Treasury is closely tied to 30-year mortgage rates.

Even if you don’t own 10-year Treasury notes, the rate on the benchmark bonds still can affect how much you pay for your mortgage. The 10-year Treasury acts as a reliable indicator of economic sentiment and as a key benchmark for mortgage rates. In 2019, the gap between the 10-year Treasury and the 30-year mortgage averaged 1.79 points, according to a Bankrate analysis of data compiled by the Federal Reserve Bank of St. Louis.

A year ago, the rate on the 10-year Treasury was north of 1.9 percent. Then the coronavirus pandemic hit, and rates on 10-year bonds plummeted. The 10-year rate fell as low as 0.52 percent in August.

The bottom line: It may be time to do that refinance sooner rather than later.

The Bankrate.com national survey of large lenders is conducted weekly. To conduct the National Average survey, Bankrate obtains rate information from the 10 largest banks and thrifts in 10 large U.S. markets. In the Bankrate.com national survey, our Market Analysis team gathers rates and/or yields on banking deposits, loans and mortgages. We’ve conducted this survey in the same manner for more than 30 years, and because it’s consistently done the way it is, it gives an accurate national apples-to-apples comparison. Our rates differ from other national surveys, in particular Freddie Mac’s weekly published rates. Each week Freddie Mac surveys lenders on the rates and points based on first-lien prime conventional conforming home purchase mortgages with a loan-to-value of 80 percent. “Lenders surveyed each week are a mix of lender types – thrifts, credit unions, commercial banks and mortgage lending companies – is roughly proportional to the level of mortgage business that each type commands nationwide,” according to Freddie Mac.