Mortgage and refinance rates today, Jan. 12, 2023
Today’s mortgage and refinance rates
Average mortgage rates fell modestly yesterday. And it may be a similar story today.
Because, so far this morning, markets are signaling that mortgage rates today might move just a little lower. However, that was on the back of important new inflation data. And those markets often have second thoughts about such numbers.
Current mortgage and refinance rates
|Conventional 30 year fixed||6.372%||6.405%||-0.07%|
|Conventional 15 year fixed||5.363%||5.418%||-0.08%|
|Conventional 20 year fixed||6.058%||6.111%||-0.04%|
|Conventional 10 year fixed||5.504%||5.62%||-0.18%|
|30 year fixed FHA||6.105%||6.845%||-0.03%|
|15 year fixed FHA||5.512%||6%||-0.07%|
|30 year fixed VA||6.198%||6.432%||+0.42%|
|15 year fixed VA||6.069%||6.427%||+0.04%|
|Conventional 5 year ARM||6.644%||6.874%||-0.03%|
|5/1 ARM FHA||6.644%||7.131%||-0.04%|
|5/1 ARM VA||6.644%||7.131%||-0.01%|
|Rates are provided by our partner network, and may not reflect the market. Your rate might be different. Click here for a personalized rate quote. See our rate assumptions here.|
Should you lock a mortgage rate today?
Don’t lock on a day when mortgage rates look set to fall. My recommendations (below) are intended to give longer-term suggestions about the overall direction of those rates. So, they don’t change daily to reflect fleeting sentiments in volatile markets.
I will revisit my personal rate lock recommendations (below) once we’ve seen how markets and the Federal Reserve react to this morning’s inflation figures, once they’ve had a chance to digest them.
And, for now, those recommendations remain:
- LOCK if closing in 7 days
- LOCK if closing in 15 days
- LOCK if closing in 30 days
- LOCK if closing in 45 days
- LOCK if closing in 60 days
>Related: 7 Tips to get the best refinance rate
Market data affecting today’s mortgage rates
Here’s a snapshot of the state of play this morning at about 9:50 a.m. (ET). The data, compared with roughly the same time yesterday, were:
- The yield on 10-year Treasury notes dropped to 3.53% from 3.57%. (Good for mortgage rates.) However, they were rising this morning, which is bad. More than any other market, mortgage rates typically tend to follow these particular Treasury bond yields
- Major stock indexes were mostly lower soon after opening. (Sometimes good for mortgage rates.) When investors buy shares, they’re often selling bonds, which pushes those prices down and increases yields and mortgage rates. The opposite may happen when indexes are lower. But this is an imperfect relationship
- Oil prices increased to $78.05 from $76.30 a barrel. (Bad for mortgage rates*.) Energy prices play a prominent role in creating inflation and also point to future economic activity
- Gold prices Edged up to $1,885 from $1,879 an ounce. (Neutral for mortgage rates*.) It is generally better for rates when gold rises and worse when gold falls. Gold tends to rise when investors worry about the economy.
- CNN Business Fear & Greed index — nudged up to 58 from 56 out of 100. (Bad for mortgage rates.) “Greedy” investors push bond prices down (and interest rates up) as they leave the bond market and move into stocks, while “fearful” investors do the opposite. So lower readings are often better than higher ones
*A movement of less than $20 on gold prices or 40 cents on oil ones is a change of 1% or less. So we only count meaningful differences as good or bad for mortgage rates.
Caveats about markets and rates
Before the pandemic and the Federal Reserve’s interventions in the mortgage market, you could look at the above figures and make a pretty good guess about what would happen to mortgage rates that day. But that’s no longer the case. We still make daily calls. And are usually right. But our record for accuracy won’t achieve its former high levels until things settle down.
So, use markets only as a rough guide. Because they have to be exceptionally strong or weak to rely on them. But, with that caveat, mortgage rates today look likely to fall. However, be aware that “intraday swings” (when rates change speed or direction during the day) are a common feature right now.
Important notes on today’s mortgage rates
Here are some things you need to know:
- Typically, mortgage rates go up when the economy’s doing well and down when it’s in trouble. But there are exceptions. Read ‘How mortgage rates are determined and why you should care’
- Only “top-tier” borrowers (with stellar credit scores, big down payments and very healthy finances) get the ultralow mortgage rates you’ll see advertised
- Lenders vary. Yours may or may not follow the crowd when it comes to daily rate movements — though they all usually follow the broader trend over time
- When daily rate changes are small, some lenders will adjust closing costs and leave their rate cards the same
- Refinance rates are typically close to those for purchases.
A lot is going on at the moment. And nobody can claim to know with certainty what will happen to mortgage rates in the coming hours, days, weeks or months.
Are mortgage and refinance rates rising or falling?
This morning’s consumer price index (CPI) is arguably the most important economic report published each month. So it’s impossible to underestimate how crucial this morning’s figures are. However, they came in precisely as economists had predicted and therefore had little impact on bond markets.
CPI and the Fed
I’ve been covering for weeks now the tensions between bond investors and the Fed. According to CNN Business, investors expect the inflation rate to drop to 2.5% in the next seven months. However, the Fed projects that rate will remain appreciably above 3% until 2024.
That is a chasm. And neither side seems willing to listen to the other. The Fed has much more power and will win the argument unless its projections are proved wrong.
Investors are wagering heavily that will be the case. But, if they’re wrong, the Fed will continue to hike its interest rates. And that may well push mortgage rates significantly higher. Let’s hope the investors’ forecasts turn out to be correct.
According to Freddie Mac’s archives, the weekly all-time low for mortgage rates was set on Jan. 7, 2021, when it stood at 2.65% for conventional, 30-year, fixed-rate mortgages.
Freddie’s Jan. 5 report put that same weekly average at 6.48%, up from the previous week’s 6.42%.
In November, Freddie stopped including discount points in its forecasts. It has also delayed until later in the day the time at which it publishes its Thursday reports. And, from now on, we’ll be updating this section on Fridays.
Expert mortgage rate forecasts
Looking further ahead, Fannie Mae, Freddie Mac and the Mortgage Bankers Association (MBA) each has a team of economists dedicated to monitoring and forecasting what will happen to the economy, the housing sector and mortgage rates.
And here are their rate forecasts for the current quarter (Q4/22) and the first three quarters of next year (Q1/23, Q2/23 and Q3/24).
The numbers in the table below are for 30-year, fixed-rate mortgages. Fannie’s and the MBA’s forecasts appeared on Dec. 19 and Freddie’s on Oct. 21. Freddie now publishes its forecasts quarterly and its figures can quickly become stale.
Of course, given so many unknowables, the whole current crop of forecasts might be even more speculative than usual. And their past record for accuracy hasn’t been wildly impressive.
Find your lowest rate today
You should comparison shop widely, no matter what sort of mortgage you want. As federal regulator the Consumer Financial Protection Bureau says:
“Shopping around for your mortgage has the potential to lead to real savings. It may not sound like much, but saving even a quarter of a point in interest on your mortgage saves you thousands of dollars over the life of your loan.”
Mortgage rate methodology
The Mortgage Reports receives rates based on selected criteria from multiple lending partners each day. We arrive at an average rate and APR for each loan type to display in our chart. Because we average an array of rates, it gives you a better idea of what you might find in the marketplace. Furthermore, we average rates for the same loan types. For example, FHA fixed with FHA fixed. The end result is a good snapshot of daily rates and how they change over time.