Thirty-year fixed rates held steady, while 15-year fixed and 5/1 ARM rates eased slightly lower Tuesday, according to a NerdWallet survey of mortgage rates published by national lenders this morning.
The mortgage rate runup since the election has pinned rates near two-year highs, with little on the horizon to ease the upward pressure. The Federal Reserve is expected to raise short-term interest rates at its meeting next week. While not a direct influence on mortgage rates, a Fed hike would give little room for long-term rates to decline.
4.3 million potential refinance candidates lost since election
The dramatic increase in mortgage rates since the presidential election has taken its toll on the number of potential refinance candidates. In a new report, real estate research firm Black Knight estimates 4.3 million homeowners have been removed from the pool of borrowers likely to refinance their home loan.
“From the 8.3 million borrowers who could both likely qualify for and had interest rate incentive to refinance immediately prior to the election, we’re now looking at a population of just 4 million total, matching a 24-month low set back in July 2015,” Ben Graboske, Black Knight executive vice president, said in a release.
However, Graboske notes there are still 2 million borrowers who could save $200 or more per month by refinancing. He also says affordability has taken a hit — with the rapid increase in mortgage rates equivalent to a rise in the average home price of over $16,400.
“It now takes 21.6% of the median income to purchase the median home nationally,” he said. “That’s the highest share of median income needed to buy the median home since June 2010, when rates were at 4.75% but the average home was worth nearly 20% less than it is today.”
Homeowners looking to lower their mortgage rate can shop for refinance lenders here.
NerdWallet daily mortgage rates are an average of the published APR with the lowest points 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.