Mortgage Rates Today, Friday, February 20: A Noticeable Jump

Mortgage interest rates are high this morning, and although we’re still in abnormally low territory, that may not last much longer.

The average interest rate on a 30-year, fixed-rate mortgage came in at 5.92% APR, according to rates provided to NerdWallet by Zillow. That’s 15 basis points higher than yesterday, but still two basis points lower than a week ago. (See our chart below for more details.) A basis point is one-hundredth of a percentage point.

Last Friday, unexpectedly positive inflation data dropped the rate significantly. However, this morning, different inflation data came out that could be bad news for mortgage rates — get the scoop below the graph.

While the economy never sleeps, the markets close on weekends. The rates you see on Friday are unlikely to change much (if at all) until Monday.

There are mortgage rates. constantly changing, Since a large part of How are rates determined? Depending on the reaction to new inflation reports, job numbers, Fed meetings, global news… you name it. For example, even small changes in the bond market can change mortgage rates.

Last week, mortgage rates rose slightly compared to the expected inflation data from January Consumer Price Index (CPI) released on February 13. That party could only last so long, though today we have new data on inflation, a different measure of personal consumption expenditures (known as PCE).

This is not a perfect apples-to-apples comparison between these two data sets. They measure inflation differently, and because the Bureau of Economic Analysis is running behind schedule after last fall’s shutdown, today’s PCE numbers were for December. Still, it’s close enough that we can call it a Red Delightful comparison to Granny Smith. They are different, but they are both apples.

And if that’s the case, PCE Mealy Red is delicious. Both the overall and core numbers came in above some expectations. (Core PCE subtracts food and energy, which can be random.) Core PCE increased 3% year over year. Meanwhile, the Federal Reserve has targeted inflation at 2 percent — and central bankers prefer PCE as a more accurate indicator than CPI.

The Fed puts the brakes on by pushing up inflation. Federal funds ratethe hope is that higher borrowing costs discourage spending. But before central bankers make a decision (their next meeting is March 17-18), mortgage rates could start to rise if hopes of a rate cut in the spring or early summer fade.

Even without the PCE, the parade of low rates was forecast to rain. The minutes of the Federal Reserve’s January meeting, released on Wednesday, showed that inflation remains a key concern for central bankers. He Voted to keep the funds rate steady. In January, but looking ahead, there were three camps: those who felt that future rate cuts were likely, those who believed that the current rate would be maintained for some time, and a group that was open to the possibility of rate hikes.

That third group, which concluded that “an upward adjustment to the target range for the federal funds rate may be appropriate if inflation remains above the target level,” caught the attention of the markets. We’ll be assuming by all means that the debate over cuts was on hold, and rate hikes weren’t really on the table. While the Fed is still unlikely to raise the funds rate (markets don’t see it happening), this inflation news is likely to dampen enthusiasm for cuts further.

If today’s rates are at least 0.5 to 0.75 percentage points lower than your current rate (and if you plan to stay in your home long enough to break even on closing costs).

With rates where they are now, if your current rate is 6.42% or higher you may want to start considering a refinance.

Also consider your goals: Are you trying to lower your monthly payment, shorten your loan term or turn home equity into cash? For example, you may be more comfortable paying a higher rate for a Cash Out Refinance More than you would for a rate and term refinance, as long as the total cost is lower than if you kept your original mortgage and added a HELOC or home equity loan.

If you’re looking for a lower rate, use NerdWallet. Refinance Calculator To estimate the savings and understand how long it will take to break even the refinancing costs.

There is no universal “right” time to start buying – what matters is whether you can comfortably afford a mortgage at today’s rates.

If the answer is yes, don’t wait too long to see if you can miss out on lower rates later. You can refinance down the road. Focus on getting. Pre-approvedComparing lender offers, and figuring out what monthly payment works for your budget.

of NerdWallet Affordability Calculator Can help estimate your potential monthly payment. If a new home isn’t in the cards just yet, there are still things you can do to strengthen your buyer profile. Take this time to pay off existing debts and increase your down payment savings. Not only will this free up more cash flow for future mortgage payments, but it can also get you a better interest rate when you’re ready to buy.

If you already have a quote you’re happy with, you should consider it. Locking in your mortgage rateEspecially if your lender offers a float-down option. A floatdown allows you to take advantage of a better rate if the market falls during your lock-in period.

Rate locks protect you from hikes during your loan process, and with the market forever bouncing around, the peace of mind can be worth it.

The rate you see advertised is a Sample rate – Usually for a borrower with perfect credit, make a large down payment, and pay off Mortgage points. It won’t match every buyer’s situation.

In addition to market factors beyond your control, the quote you want depends on you:

• Location and type of property

Even Two people with the same credit score Depending on their overall financial profiles, different rates may be available.

Maybe – but even personalized rates Can be changed until you lock. This is because lenders adjust prices several times a day in response to market changes.