Mortgage rates today, August 28, and rate forecasts for next week

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Today’s Mortgage and Refinance Rates

Average mortgage rates fell yesterday. But the rises and falls of the week canceled each other out. And the average Friday night rate was exactly the same as the previous Friday night, according to figures from the Mortgage News Daily.

And mortgage rates next week can also change very little. Yes, there will be the usual ups and downs. But rates may well go nowhere. Of course, there is always a possibility that an unforeseen event will arise that disrupts that tranquility and disrupts those rates in a decisive way.

Find and lock in a low rate (August 28, 2021)

Current mortgage and refinancing rates

Program Mortgage rate APR* Switch
Conventional 30 years fixed 2.808% 2.808% -0.01%
Conventional 15 years fixed 1.995% 1.996% -0.12%
Conventional 20 years fixed 2,391% 2,391% -0.1%
Conventional 10 years fixed 1.875% 1,922% -0.04%
30-year fixed FHA 2.688% 3.343% Unchanged
15 years fixed FHA 2,431% 3.032% -0.01%
5/1 ARM FHA 2.5% 3,201% Unchanged
Fixed VA over 30 years 2.25% 2,421% -0.07%
VA fixed 15 years 2.25% 2,571% Unchanged
5/1 ARM VA 2.5% 2,379% Unchanged
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 (August 28, 2021)


COVID-19 Mortgage Updates: Mortgage lenders change rates and rules due to COVID-19. To see the latest information on the impact of the coronavirus on your home loan, click here.

Should you lock in a mortgage rate today?

In the absence of something unexpected, August is likely to end with mortgage rates a little higher than at the beginning. But the movements of the past few weeks have been smooth and directionless. So you probably haven’t lost or gained much by floating your rate.

But the risks of continuing in this way remain real. Because almost all experts predict more or less large overall increases. The problem is, no one knows when.

My personal recommendations therefore remain:

  • LOCK if closing 7 days
  • LOCK if closing 15 days
  • LOCK if closing 30 days
  • FLOAT if closing 45 days
  • FLOAT if closing 60 days

However, with so much uncertainty 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

Thus, mortgage rates remain calm. They continue to drift up and down but barely move when measured over weeks.

And, this week, they dodged a bullet when Federal Reserve Chairman Jerome Powell’s speech yesterday revealed nothing new. He confirmed that the Fed will begin to slow down and later stop (“cut back”) its efforts to keep mortgage rates artificially low later this year. But everyone already knew that.

And regular readers will be relieved that I can finally stop repeating the reduction every day. However, the problem has not gone away and will return in a few weeks.

Waiting for

In the meantime, mortgage rates will be affected by the economic news. But that too is a less direct relationship than it usually is.

Under normal circumstances, mortgage rates go up on good economic news and fall on bad news. But that’s not always the case right now.

Take, for example, next Friday’s report on the employment situation. It is often the most influential of all monthly economic reports, sometimes rivaled only by those on inflation. And a great report on Friday (many more jobs and higher average hourly earnings) would normally push mortgage rates higher.

But that may not be the case this time. Because investors always have an eye on the Fed. And great jobs data could bring forward the dates when it stops keeping mortgage rates and Treasury yields low – and accelerate when it starts raising its own interest rates.

Thus, some investors view the good economic news as damaging to their interests because it potentially hastens the end of the Fed’s easy money policies. And they are enjoying this holiday in particular.

The Fed is unlikely to hike rates until much of 2022 or maybe sometime in 23. And it’s important to differentiate between the Fed’s own interest rates and mortgage rates. A change in Fed rates tends to directly influence the rates on variable rate loans, including credit cards, auto loans, and the like. But mortgage rates are determined differently and largely independently of the Fed (see below for more details).

Economic reports next week

Please see the final paragraphs for more information on next week’s major economic report, Friday’s Jobs Report. It is difficult to overestimate the influence this can have.

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. Plus, regular readers will know that investors have ignored most economic reports in recent months. Thus, the effects of the following may be different from normal:

  • Tuesday – Consumer Confidence Index in August
  • Wednesday – August ADP (Private Sector Jobs) and Manufacturing Index report from the Institute for Supply Management (ISM). Plus July construction expenses
  • Thursday – New weekly unemployment insurance claims until August 28. More factory orders in July
  • Friday – Report on the employment situation in August, including non-farm wages, unemployment rate and average hourly earnings. Plus ISM services index, also for August

Once again, Friday is the big day.

Find and lock in a low rate (August 28, 2021)

Mortgage interest rate forecasts for next week

Now that the tapering is complete (for a few weeks), I see little reason to expect any sharp changes in mortgage rates anytime soon. And I suspect that mortgage rates next week will be unchanged or barely changed.

Mortgage and refinancing rates generally move in tandem. And a growing gap between the two has been largely eliminated by the recent removal of unfavorable refinancing fees from the market.

How your mortgage interest rate is determined

Mortgage and refinancing 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. Mortgage rates therefore tend to be high when things are going well and low when the economy is struggling.

Your part

But you play an important role in determining your own mortgage rate in five ways. 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 Your Mortgage Carefully – Are you better off with a conventional, FHA, VA, USDA, jumbo or whatever loan?

The time spent getting those ducks in a row can earn you lower rates.

Remember, it’s not just a mortgage rate

Be sure to count all of your upcoming 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 are reflected in the Annual Percentage Rate (APR) that will be shown 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.

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