Brexit Break for Mortgage Rates Showing Signs of Reversing

Mortgage Rates, Mortgages
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mortgage rates

For the first time since Britain’s vote to exit from the European Union last week, 30-year mortgage rates are showing signs of reversing direction. After dropping more than an eighth of a point in four days, the average rate on the popular loan term ticked higher Thursday morning, according to the NerdWallet Mortgage Rate Index.

Following the U.K.’s surprising “Brexit,” mortgage rates plummeted, as investors sold off equity stakes and bought into bonds. Stock markets have recovered over the past two days, and the bond fever has subsided. As a result, mortgage rates have leveled off.

“In the wake of the Brexit vote, the yield on the 10-year U.S. Treasury bond plummeted 24 basis points. The 30-year mortgage rate declined as well, but not by as much,” Sean Becketti, chief economist for Freddie Mac said in a release. “This week’s survey rate is the lowest since May 2013 and only 17 basis points above the all-time low recorded in November 2012. This extremely low mortgage rate should support solid home sales and refinancing volume this summer.”

Mark Boud, chief economist of Metrostudy, a housing market research firm, believes mortgage rates won’t move much from current levels.

“We expect them to remain flat during the summer months and possibly increase during the fourth quarter of 2016,” Boud says in a video report. “Thereafter, we’re forecasting a gradual rise in mortgage rates throughout the next five years.”

The NerdWallet Mortgage Rate Index compiles annual percentage rates — lender interest rates plus fees — the most accurate way for consumers to compare rates. Here are Wednesday’s average rates for the most popular loan terms:

Purchase Mortgage Rates: June 30, 2016

(Change from 6/29)

30-year fixed: 3.63% APR (+0.01)

15-year fixed: 3.04% APR (+0.01)

5/1 ARM: 3.33% APR (+0.01)

 

Refinance Mortgage Rates: June 30, 2016

(Change from 6/29)

30-year fixed: 3.71% APR (NC)

15-year fixed: 3.04% APR (NC)

5/1 ARM: 3.35% APR (+0.01)

Homeowners looking to lower their mortgage rate can shop refinance lenders here.

Wells Fargo, Chase and BOA mortgage rates

Three major components of the NerdWallet Mortgage Rate Index are leading lenders Wells Fargo, Chase and Bank of America. Their current purchase mortgage rates are:

Bank Mortgage Rates 6/30

 30-year fixed15-year fixed5/1 ARM
Wells Fargo3.68% APR3.07% APR3.41% APR
Chase3.44% APR2.88% APR3.32% APR
Bank of America3.66% APRN/A3.29% APR

NerdWallet daily mortgage rates are an average of the lowest published APR for each loan term offered by a sampling of major national lenders. Annual percentage rate quotes reflect an interest rate plus points, fees and other expenses, providing the most accurate view of the costs a borrower might pay.

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Hal Bundrick is a staff writer at NerdWallet, a personal finance website. Email: hal@nerdwallet.com. Twitter: @halmbundrick.