Mortgage rates today, January 8 and rate forecasts for next week

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Today’s Mortgage and Refinance Rates

Average mortgage rates rose again yesterday. The start of 2022 has been appalling for those who have yet to lock in their rates. There have been increases every day, some significant.

Unfortunately I suspect mortgage rates could continue to rise next week. There aren’t many glimmers of hope. But short periods of falls are common after such sharp rises.

So if any of them come up next week, I could be wrong. But I would be surprised if these rates recovered something like the ground they lost. Unless, that is, there is unexpected bad scientific news about the Omicron variant of COVID-19 that suggests its ill effects are likely to last longer than expected.

Find and lock in a low rate (January 8, 2022)

Current mortgage and refinancing rates

Program Mortgage rate APR* Change
Conventional 30 years fixed 3,649% 3,671% + 0.08%
Conventional 15 years fixed 2.912% 2.949% + 0.06%
Conventional 20 years fixed 3.483% 3.52% + 0.1%
Conventional 10 years fixed 2.907% 2.978% + 0.08%
30-year fixed FHA 3.678% 4.431% + 0.05%
15-year fixed FHA 2.887% 3,537% + 0.13%
5/1 ARM FHA 2.815% 3,417% + 0.05%
Fixed VA over 30 years 3,433% 3,628% + 0.13%
15-year fixed VA 3,191% 3,538% + 0.09%
5/1 ARM VA 2.753% 2.681% + 0.04%
Prices are provided by our network of partners and may not reflect the market. Your rate may be different. Click here for a personalized quote. See our pricing assumptions here.

Find and lock in a low rate (January 8, 2022)


Should you lock in a mortgage rate today?

The last time I wrote this weekend edition of our Daily Rate Report was before Christmas. And most feared the health and economic damage Omicron could cause.

I then wrote: “… the first signs are bad. And that should keep mortgage rates low, at least until we get more reliable data. Well, we have more reliable data.

And that prompts real optimism, not for the short term, of course, but for the spring and beyond. Read on for more details.

It changed everything. And my personal rate foreclosure recommendations are:

  • LOCK if closing seven days
  • LOCK if closing 15 days
  • LOCK if closing 30 days
  • LOCK if closing 45 days
  • LOCK if closing 60 days

However, with so many uncertainties right now, your instincts could easily turn out to be as good as mine, if not better. So let your instincts and your personal risk tolerance guide you.

What changes current mortgage rates

Soon

The Omicron variant is likely to bring a world of pain for several weeks. Even though it usually causes only mild or no symptoms in most people, the sheer volume of new cases every day will inevitably create a high demand for hospitalizations and intensive care beds. And it can overwhelm medical resources in some hot spots. Worse, deaths will increase.

All of this has already caused a great deal of economic damage and there is, without a doubt, more to come. So why are the markets acting like Omicron and COVID-19 are gone?

Well, because investors always claim that they are looking (and trading) at least months in advance. And most of them adhere to an optimistic – albeit credible – scenario of what things might look like in a few months.

Back to normal in the spring?

They believe that Omicron, with its very high transmissibility, could blow the population away quickly, reaching its peak in about a few weeks. By the time it returns to normal levels, a huge proportion of Americans (and foreigners) will have been infected and therefore have high levels of immunity against all existing variants of COVID-19 – and possibly future ones. Also. In other words, we would have achieved collective immunity.

If that happened, COVID-19 would very soon turn from a pandemic to an endemic illness, similar to the seasonal flu. This is what happened to the Spanish flu a century ago. And we and the economy could get back to something close to normal, maybe by the onset of spring.

Now all of this is far from certain. And some public health researchers and virus experts are not yet ready to embrace the scenario. But many are, at least as a strong possibility.

Rising mortgage rates?

And the markets certainly seem to be. This is the main reason why mortgage rates have been rising steadily for over a week.

Meanwhile, the top three forces working to drive mortgage rates up, but which Omicron has overshadowed, are back in the spotlight. Those are:

  1. Uncomfortably high inflation rates
  2. The Federal Reserve’s dismantling of its stimulus programs in the era of the pandemic
  3. A continuous and strong economic recovery (admittedly with hiccups)

Of course, mortgage rates will sometimes go down. These ups and downs are a constant feature of the markets.

But, unless this optimistic Omicron scenario is overtaken by events, I expect those rates, overall, to continue to climb.

Economic reports next week

Important economic reports are due for release next week. Wednesday’s consumer price index will provide more information on inflation in December. And Friday’s retail sales data will give some indication of how the economic recovery has unfolded this month at the consumer level.

Key reports of the week, below, are in bold.

But none of the other economic reports listed below are likely to cause much movement in the markets unless they include some incredibly good or bad data:

  • wednesday – december consumer price index (CPI) and Core CPI (CPI without volatile food and fuel prices)
  • Thursday – December producer price index – another measure of inflation. More weekly new unemployment insurance claims to January 8
  • Friday – December retail sales. And the import price index, and industrial production and capacity utilization, also for this month. In addition, the January first reading of the consumer confidence index

Chances are, Wednesday and Friday are the days to watch.

Show me today’s rates (January 8, 2022)

Mortgage interest rate forecasts for next week

Mortgage rates could rise globally next week. But some falls can occur, simply because they often occur after prolonged periods of rising.

And it is certainly possible that these outweigh the increases. But I’d be surprised if they did unless these key economic reports contain some really bad news or we learn some disturbing new things about Omicron.

Mortgage and refinancing rates generally move in tandem. And the removal of unfavorable refinancing fees from the market largely eliminated the gap that had grown between the two.

Meanwhile, another recent regulatory change has likely made mortgages for investment property and vacation homes more accessible and less expensive.

How your mortgage interest rate is determined

Mortgage and refinance rates are generally determined by prices in a secondary market (similar to stock or bond markets) where mortgage-backed securities are traded.

And it depends heavily on the economy. So mortgage rates tend to be high when things are going well and low when the economy is struggling.

Your part

But there are five ways you play an important role in determining your own mortgage rate. And you can significantly affect it by:

  1. Find Your Best Mortgage Rate – They Vary Dramatically From Lender to Lender
  2. Increase Your Credit Score – Even a Small Bump Can Make a Big Difference in Your Rate and Payments
  3. Save the Biggest Down Payment Possible – Lenders love you to have real skin in this game
  4. Keep your other loans small – The lower your other monthly commitments, the larger the mortgage you can afford
  5. Choosing the Right Mortgage – Are you better off with a conventional, FHA, VA, USDA, jumbo or other loan?

Time spent lining up these ducks can earn you lower rates.

Remember, it’s not just a mortgage rate

Make sure you factor in all of your future homeownership costs when determining how much mortgage you can afford. So focus on your “PITI”. It’s your Pmain (reimburses the amount you borrowed), Iinterest (the loan price), (property) Taxes, and (owners) Iassurance. Our mortgage calculator can help.

Depending on the type of mortgage you have and the amount of your down payment, you may also need to pay for mortgage default insurance. And that can easily reach three digits each month.

But there are other potential costs. You will therefore have to pay homeowners association dues if you choose to live somewhere with an HOA. And, wherever you live, you should expect repair and maintenance costs. There is no owner to call in case of a problem!

Finally, you will have a hard time forgetting the closing costs. You can see which ones are reflected in the Annual Percentage Rate (APR) that lenders will quote to you. Because it effectively spreads them out over the life of your loan, making it higher than your normal mortgage rate.

But you may be able to get help with those closing costs. and your down payment, especially if you are a first-time buyer. Read:

Down payment assistance programs in each state for 2021

Mortgage rate methodology

Mortgage Reports receive daily rates based on selected criteria from multiple lending partners. We arrive at an average rate and an APR for each type of loan to display in our graph. Because we average a range of rates, it gives you a better idea of ​​what you might find in the market. In addition, we average the rates for the same types of loans. For example, fixed FHA with fixed FHA. The result is a good overview of daily rates and how they have changed over time.

The information on The Mortgage Reports website is provided for informational purposes only and does not constitute an advertisement for any products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, its parent company or its affiliates.


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