Thursday, 06 January 2022

Ever since the beginning of 2022, mortgages rates have been rising continuously. Even though the pace is slow, the trend suggests that the rates will not stop anytime soon. Despite the increase in rates, the rates are relatively low compared to the historical trends. Nevertheless, the mortgages rates for today are as follows:

·   30-year-old mortgage: 3.35% for home purchase and 3.35% for refinancing

·   15-year-old mortgage: 2.62% for home purchase and 2.58% for refinancing

·   5/1 ARM: 2.73% for home purchase and 2.67% for refinancing

·   30-year jumbo mortgage: 3.36% for home purchase and 3.36% refinancing

What is the trendline?

30-year fixed-rate mortgage

Compared to yesterday, there is an increase of one basis point. However, the rates are high by eleven basis points from the last week. Even last month, the rates were ten basis points lower than now. The situation is daunting for homebuyers because monthly payments will be high. Even the refinance rate has been up by thirteen bps since last week, suggesting buyers hold on to their decisions to refinance.

15-year fixed-rate mortgage

There has been no change in 15 term mortgages since yesterday. However, the rates are nine bps higher than last week. The increase in rates has further made 15-year mortgages expensive for homebuyers.

5/1 ARM

The rates on 5/1 ARM retreated by around one bps since last week. Plus, there has been a decline of two bps since yesterday. A slight fall makes them a cheaper option for their fixed-rate period.

30-year fixed-rate jumbo mortgage

A 30-year jumbo mortgage has risen by around one bps since yesterday. However, they are thirteen bps higher than last week. The trends suggest that the jumbo mortgage follows the trend of a traditional mortgage.

What to Expect?

The trendline suggests that rates will rise this year due to several reasons such as inflation, tight labor market, and economic recovery. Even the threat of the Omicron variant of COVID is low, and the COVID outbreak is better under control now. Therefore, economies are returning to the pre-pandemic state, which suggests high inflation.

The rise in interest rates is to slow down the effects of high inflation and curb the pressure. Even the FEDs are reducing their bond purchases to release control on the interest rates, causing them to rise.

Conclusion

Expectations for 2022 are high, which is accelerating the mortgage rates. Before it gets too expensive to afford a mortgage, take advantage of low rates now and build the home of your dreams.

Visit a rate checker to get quotes from top lenders.