Mortgage rates move lower for Friday Feb 24 2017

Mortgage rates move lower for Friday

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Yuganov Konstantin/Shutterstock.com

Several key mortgage rates dropped today. The average rates on 30-year fixed and 15-year fixed mortgages both decreased. On the variable-mortgage side, the average rate on 5/1 adjustable-rate mortgages also fell.
Mortgage rates are in a constant state of flux, but, overall, they are very low by historical standards. If you're in the market for a mortgage, it may be a great time to lock in a rate. Just make sure you shop around first.
RATE SEARCH: Compare mortgage rates in your area now.

30-year fixed mortgages

The average rate you'll pay for a 30-year fixed mortgage is 3.97 percent, down 7 basis points
over the last week. A month ago, the average rate on a 30-year fixed mortgage was higher, at 4.09 percent.
At the current average rate, you'll pay a combined $475.69 per month in principal and interest for every $100,000 you borrow. That's a decline of $4.03 from last week.
You can use Bankrate's mortgage calculator to estimate your monthly payments and see how much you'll save by adding extra payments. It will also help you calculate how much interest you'll pay over the life of the loan.

15-year fixed mortgages

The average 15-year fixed-mortgage rate is 3.16 percent, down 2 basis points
over the last seven days.
Monthly payments on a 15-year fixed mortgage at that rate will cost around $698 per $100,000 borrowed. The bigger payment may be a little more difficult to find room for in your monthly budget than a 30-year mortgage payment would, but it comes with some big advantages: You'll come out several thousand dollars ahead over the life of the loan in total interest paid and build equity much more quickly.

5/1 ARMs

The average rate on a 5/1 ARM is 3.15 percent, falling 1 basis point from a week ago.
These types of loans are best for those who expect to sell or refinance before the first or second adjustment. Rates could be substantially higher when the loan first adjusts, and thereafter.
Monthly payments on a 5/1 ARM at 3.15 percent would cost about $430 for each $100,000 borrowed over the initial five years, but could increase by hundreds of dollars afterward, depending on the loan's terms.

Where rates are headed

To see where Bankrate's panel of experts expect rates to go from here, check out our Rate Trend Index.
RATE SEARCH: Want to see where rates are right now? See local mortgage rates.

Average mortgage rates

Product	Rate	Change	Last week
30-year fixed	3.97%	0.07	4.04%
15-year fixed	3.16%	0.02	3.18%
30-year fixed jumbo	4.46%	0.16	4.30%
30-year fixed refinance	3.99%	0.09	4.08%

Last updated: February 24, 2017.

Methodology: The rates you see above are Bankrate.com Site Averages. These calculations are run after the close of the previous business day and include rates and/or yields we have collected that day for a specific banking product. Bankrate.com site averages tend to be volatile -- they help consumers see the movement of rates day to day. The institutions included in the "Bankrate.com Site Average" tables will be different from one day to the next, depending on which institutions' rates we gather on a particular day for presentation on the site.
To learn more about the different rate averages Bankrate publishes, see "Understanding Bankrate's Rate Averages."

Bobby Robert Darvish Platinum Lending Solutions Orange County

Mortgage Rates Were Up on Friday as the Jobs Report Showed the Signs of a "Trump Effect"

Mortgage rates were slightly higher on Friday. Meanwhile, the U.S. economy added 227,000 jobs in the month of January, beating expectations and providing evidence that the "Trump effect" on animal spirits has had an early economic impact.

The average 30-year mortgage rate rose four basis points, to 4.08%, on Friday, which equates to a $482.04 monthly payment per $100,000 borrowed (one basis point equals one-hundredth of a percentage point). A month ago, the equivalent payment was lower by $1.74.
The average 15-year mortgage rate rose one basis point, to 3.23%, equating to a $701.70 monthly payment per $100,000 borrowed. A month ago, the equivalent payment was the same.

Rate (national average)	Today	1 Month Ago
30-year fixed jumbo	4.48%	4.57%
30-year fixed	4.08%	4.05%
15-year fixed	3.23%	3.23%
30-year fixed refi	4.11%	4.09%
15-year fixed refi	3.25%	3.25%
5/1 ARM	3.26%	3.39%
5/1 ARM refi	3.33%	3.60%

5/1 ARM: ADJUSTABLE-RATE MORTGAGE WITH AN INITIAL FIXED FIVE-YEAR INTEREST RATE. DATA SOURCE: BLOOMBERG. RATES MAY INCLUDE POINTS.

Image source: Getty Images.

Mortgage rates are closely linked to the yield on the 10-year Treasury bond. That yield, in turn, reflects the bond market's expectations for future short-term interest rates over the bond's maturity. And short-term interest rates, well, they reflect the Fed's assessment of the economy and its prospects.

This brings us to the most highly anticipated macroeconomic data release: the Labor Department's monthly Employment Situation Report. This morning's report was no different, as economists and investors try to find their bearings during the first 100 days of the iconoclastic Trump administration.
The January report was broadly positive with 227,000 workers added to payrolls, surpassing the consensus forecast of 175,000. As the following graph shows, the figure for January (blue line) is above the trailing 12-month average of 195,000 (red line):

Image source: Federal Reserve Bank of St. Louis.

The unemployment rate ticked up by a tenth of a percentage point, to 4.8%, but the trend reflects an economy that's creating enough jobs to maintain the unemployment rate (green line) at 5% or below. (Note that the participation rate has remained pretty stable over this period.)
While their ardor appears to have cooled somewhat since the actual handover in power, stock and bond market investors took a very buoyant view of economic prospects under the new administration. The narrative was that a businessman in the highest office would act decisively to boost American businesses, and that was plainly enough to raise "animal spirits." Today's data suggests the "Trump effect" probably had a genuine economic impact, but investors need to "watch the downside," too.

By: Robert Bobby Darvish of Platinum Lending Solutions of Orange County