Mortgage rates worsened on Monday and gave back some of Friday’s gains, as mortgage-backed securities (MBS) experienced a meltdown. When pricing on mortgage bonds falls, mortgage rates tend to rise, and this is what’ve happened today. Some of the nation’s top mortgage lenders have already adjusted their rate sheets with higher interest rates compared to Friday’s levels, according to our observations.
There’s no significant economic data scheduled for release on Monday. This week’s first batch of domestic economic data, that could have an influence on markets and indirectly on mortgage interest rates, is March’s JOLTS report, which is going to be published on Tuesday at 10:00 AM Eastern Time. As we reported earlier, the most recent Job Openings and Labor Turnover report from February showed job openings at a 14-year high. If March’s JOLTS data turns out positive as well, it could signal that employers have more confidence in the economy, thus creating more jobs.
Still, this week’s most important set of domestic economic data, that could have an impact on U.S. mortgage rates, includes April’s retail sales data, the producer price index for April and the industrial production report for April. All these data will show us a clear picture whether the U.S. economy is on the path of a rebound in the second quarter or if the ecomomy is slowing. In case these economic reports turn out worse-than-expected, mortgage rates could benefit, and interest rates may eventually head downwards. On the other hand, if we get better-than-expected data, mortgage interest rates could be easily facing an upward pressure.
Borrowers should also be aware of that movements in the European bond markets could also have an impact on U.S. mortgage rates. In case European bond markets are changing course and move away from all-time lows that could influence U.S. mortgage interest rates as well.
Besides the above mentioned factors, the Fed’s impending rate hike will put additional pressure on mortgage rates, once the hike happens. What is certain at this point, that the Fed is going to increase short-term interest rates at some point this year, which could happen as soon as June. However, most analysts believe a rate hike in September is the most likely scenario. Whether the rate happens in June or September, it will push mortgage interest rates to higher territories.
On Monday, San Francisco Fed President John Williams reiterated his view in an interview with CNBC, that the U.S. economy is expected to bounce back in the second quarter following a weaker performance in Q1. He also welcomed April’s job data, as it came in with some stronger figures compared to February’s employment report. As far as rate hike is concerned, the top Fed official said that it’s on the table at every Fed meeting, but the decision and exact timing of increasing short-term interest rates ultimately depends on what the economic data shows.
With regards to today’s mortgage interest rates at top lenders, at Wells Fargo (NYSE:WFC), the 30-year fixed conventional home loan is available today at a rate of 4.125%. The shorter-term, 15-year fixed mortgage loan demands 3.375% interest.
Under the lender’s refinance loan program, the 30-year fixed refi mortgage is coming out at a rate of 4.125% on Monday, Borrowers, who believe the 15-year fixed home refinance loan is a more suitable option, will see this type of loan being offered at a rate of 3.375%.
Another U.S. lender, Chase (NYSE:JPM) advertises the 30-year FRM home loan for as low as 3.750%. The bank’s 15-year fixed counterpart is up for grabs at 3.125%, according to our observations.
Moving on to home refinance loans, the standard 30-year refi mortgage at Chase is currently available at a rate of 4.000%. Borrowers, who prefer the popular 15-year FRM for refinancing, can expect to pay 3.250% interest cost.
Over at U.S. Bank (NYSE:USB), the long-term 30-year home purchase loan is set at 4.125%. The loan provider’s shorter-term, 15-year fixed home mortgage is offered at a rate of 3.375%, according to the latest published loan information.
The above mentioned interest rates are subject to change and are not guaranteed. In order to search for live mortgage rate quotes from some of the top U.S. lenders, please click on the link below. To calculate your monthly mortgage payment, feel free to use our featured mortgage calculator.