The Fed and Mortgage Rates - March 2019:
The Fed Chairman's testimony before Congress this week was significant for mortgage rates. This is in addition to the mortgage rate friendly comments made by various Fed members since mid-February. During Fed Chairmen Powells testimony this week he reaffirmed that the Fed is looking to end it's balance sheet reduction program. This is positive news for mortgage rates as we move further into 2019.
Does This Mean Mortgage Rates Will Move Lower:
Will this decision it result in lower mortgage rates? No; there are so many factors that influence mortgage rates but it may help. Ending the balance sheet reduction program is a positive for mortgage rates in 2019.
Today's Mortgage Rates:
Staying on top of current mortgage rates is essential for those considering a home purchase or a refinance of their current mortgage. Looking at today's mortgage rates it appears fixed rate mortgages (Conforming loan amounts) are similar to mortgage rates seen over the last 4-6 weeks. Mortgage rates are set in the Mortgage Backed Securities market and trading in that market has been in a range since late January. 30 year fixed mortgage rates remain near their one year low as do 20 and 15 year fixed rates.
Mortgage Rate Quotes:
When obtaining a mortgage rate quote be sure to request the following information to ensure you get all the information you need to make an informed decision.
- Loan Program (ie is it a 30 year fixed rate)
- Is there a pre-payment penalty
- Are there discount points
- Are there origination fees
- What are the total costs (for everything)
- When is the rate locked
- How long will it take to close
There are additional bits of information you'll want to ask however the above are a must. If the Loan Officer avoids answering your questions directly you might want to avoid working with that company. I suggest only working with companies that have at least an "A" rating with the Better Business Bureau.
March 2019 Mortgage Rate Forecast:
Starting off the month mortgage rates will remain in their recent range. As we move further into the month we'll have to keep an eye on the economic data, trade tensions with China and what the Fed will do with its balance sheet reduction program. So far 2019 has been great for mortgage rates and the most likely scenario is that mortgage rates remain within their range until something significant happens that pushes them out of the range. Below is the mortgage rate range and is not a quote. It's only for informational purposes:
- 30 year fixed rate: 4.125% - 4.375%
- 20 year fixed rate: 3.875% - 4.125%
- 15 year fixed rate: 3.50% - 3.75%
This is a for a conforming loan amount, primary residence, no cash out and excellent credit. All three options are significantly below the mortgage rates seen in September and October 2018. A move below 4.00% on a 30 year fixed rate would most likely trigger a wave of refinances. On the other side; a move back up to 4.75% - 5.00% will dramatically decrease the number of home owners and home buyers applying for a new mortgage.