Mortgage Rates Today
Mortgage rates increased 3 basis points this week to 5.74% down from a high of 6.01% in June 2022. To put this increase into perspective, for a $100,000 loan, the monthly payment would increase $2, from $581/mo. to $583/mo. or just $0.06/day. That’s cheaper than the average cost of a Starbuck’s drink.
One of the best ways to get the lowest possible mortgage rate is to comparison shop by comparing rates from multiple lenders.
While Mortgage rates increased, the 10 Year Treasury rates decreased 5 basis points which caused an 8-bps increase in the spread, to 283 bps. With the historical spread being 168 bps, there now exists a “safety cushion” of 115 bps above this historical spread.
The historic spread between the 10 Year Treasury and mortgage rates is 168 bps (see the green line, right axis) and currently, there are 115 bps above the historical norm. Given how quickly rates have recently risen, pricing personnel are going to want to retain this “115 bps cushion” to safeguard against unexpected rate increases given both the recent robust New Jobs report and CPI increasing to 9.1%.
Bill Knudson – Research Analyst for Landco ARESC