Mortgage Rates Today, Tuesday, November 10: A Little Lower

Mortgage rates are a little lower today. It probably won’t last, thanks to new inflation data that has investors even more confident that the Federal Reserve will hike rates next month. You can read more on that below the charts.

Today, the average interest rate on a 30-year, fixed-rate mortgage ticked down to 6.9% APR, according to rates provided to NerdWallet by Zillow. This is eight basis points lower than yesterday and 17 basis points lower than a week ago. (A basis point is one one-hundredth of a percentage point.)

Here are the average APRs we’re seeing today, as well as movement over the past month for context:

Mortgage rates are constantly changing, since a major part of how rates are set depends on reactions to new inflation reports, job numbers, Fed meetings, global news … you name it. For example, even tiny changes in the bond market can shift mortgage pricing.

This morning the Bureau of Labor Statistics (BLS) dropped the October Consumer Price Index, which shows that inflation rose another 0.4% last month. This outpaced expectations: Economists had forecasted an increase of 0.3%. CPI is one of two key measures of inflation, which the Federal Reserve aims to keep in check relative to the strength of the labor market. (The Fed looks more closely at a different inflation measure, the Personal Consumption Expenditures Index, which comes out Nov. 25.)

Raising the federal funds rate is the Fed’s main tool for bringing inflation down, and futures traders are banking on a rate hike when the committee meets Dec. 8-9. The Fed doesn’t set mortgage rates directly, but an anticipated rate hike can put upward pressure on mortgage rates, which respond to investors’ expectations for the economy and Fed policy.

Central bankers raised the federal funds rate in September, but it hasn’t been enough to pull inflation closer to the Fed’s target of 2%. Investors aren’t sure that one more hike in December will do the trick, either. According to CME FedWatch, further rate hikes may be in store for January.

Refinancing might make sense if today’s rates are at least 0.5 to 0.75 of a percentage point 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 right now, you may want to start considering a refi if your current rate is around 7.4% or higher.

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 might be more comfortable with paying a higher rate for a cash-out refinance than you would for a rate-and-term refinance, so long as the overall costs are 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’s refinance calculator to estimate savings and understand how long it would take to break even on the costs of refinancing.

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

If the answer is yes, don’t get too hung up on whether you could be missing out on lower rates later; you can refinance down the road. Focus on getting preapproved, comparing lender offers, and understanding what monthly payment works for your budget.

NerdWallet’s affordability calculator can help you estimate your potential monthly payment. If a new home isn’t in the cards right now, there are still things you can do to strengthen your buyer profile. Take this time to pay down existing debts and build your down payment savings. Not only will this free up more cash flow for a future mortgage payment, 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 locking your mortgage rate, especially if your lender offers a float-down option. A float-down lets you take advantage of a better rate if the market drops during your lock period.

Rate locks protect you from increases while your loan is processed, and with the market forever bouncing around, that peace of mind can be worth it.

The rate you see advertised is a sample rate — usually for a borrower with perfect credit, making a big down payment, and paying for mortgage points. That won’t match every buyer’s circumstances.

In addition to market factors outside of your control, your customized quote depends on your:

• Location and property type

Even two people with similar credit scores might get different rates, depending on their overall financial profiles.

Maybe — but even personalized rate quotes can change until you lock. That’s because lenders adjust pricing multiple times a day in response to market changes.