Mortgage rates for March 1, 2022: Rates take a tumble
After weeks of steady increases, Rate mortgage rates are falling today, March 1, 2022. While the domestic economic conditions that led to earlier rate hikes remain the same, today’s dip can be largely attributed to the ongoing conflict in Ukraine. As the Russian invasion continues, investors are gravitating toward financial vehicles that are perceived to offer the most stability — i.e., securities.
Increased demand for mortgage-backed securities typically results in lower interest rates, which is what we’re seeing today. With mortgage rates across all loan types at their lowest point in weeks, now could be a good time to lock in your rate on a new purchase or refinance.
Market update
With the military action heating up in Ukraine, bonds traded much higher throughout the day. Crude oil reached $100 per barrel over the weekend and prices remained elevated throughout the day. Financial conditions remain stressed after the West took dramatic steps toward isolating Russia financially; that has really been the main difference between this week and last.
While I don’t think there is a real danger that bonds will reverse in the next day or two, the situation in Ukraine doesn’t do much to alleviate the inflation problem, which has been the main theme throughout 2022 – I still see this as a locking opportunity. There are plenty of potentially market-moving events featured throughout the week, including: President Biden’s State of the Union tomorrow night, Jerome Powell speaking on Wednesday, and Friday we get the February employment report. Mortgages ended the day 20/32nds higher and the 10yr fell sharply to 1.82. Stocks recovered from early losses, yet still ended the day negative.
— Jeremy Collett, Rate Executive Director of Capital Markets***
30-year fixed rate
After crossing the 4% mark for the first time in years, interest rates on 30-year fixed rate loans are back below that threshold today. While 30-year rates are down day over day (DOD) and week over week (WOW), they’re still up month over month (MOM). With these terms, anyone fitting our borrower profile below would be looking at a $1,393.61* mortgage payment on a $375,000 home.
- Today’s rate: 3.775%
- DOD change: down 27.5 bps**
- WOW change: down 20 bps
- MOM change: up 22.5 bps
- Today’s APR: 3.875%
- DOD change: down 27.8 bps
- WOW change: down 20.2 bps
- MOM change: up 22.7 bps
15-year fixed rate
The 15-year fixed rate loan is a bit of an outlier today: Although 15-year rates are lower today than they were yesterday, they actually haven’t changed at all from this time last week. And like 30-year rates, they’re higher than they were last month. But that just goes to show how rough February was on mortgage rate movement. If you locked in your rate now, your monthly mortgage payment would be $2,089.83.*
- Today’s rate: 3.125%
- DOD change: down 25 bps
- WOW change: 0
- MOM change: up 25 bps
- Today’s APR: 3.297%
- DOD change: down 25.3 bps
- WOW change: 0
- MOM change: up 25.2 bps
FHA 30-year fixed rate
Interest rates on FHA 30-year fixed rate mortgages have plummeted today. Rates are down significantly both day over day and week over week. While FHA 30-year rates are higher now compared with last month, it’s only a slight increase. With these financing terms, you’d spend $1,355.52* on your home loan each month.
- Today’s rate: 3.550%
- DOD change: down 57.5 bps
- WOW change: down 57.5 bps
- MOM change: up 5 bps
- Today’s APR: 4.346%
- DOD change: down 59.4 bps
- WOW change: down 59.4 bps
- MOM change: up 5.2 bps
7-year ARM
Adjustable rate mortgages (ARM) have seen interest rates fall today, as well. In fact, looking at 7-year ARM loans, interest rates are actually lower now than they were last month. None of our fixed rate loans can say the same. Right now, your mortgage payment on a 7-year ARM would be $1,326.29.*
- Today’s rate: 3.375%
- MOM change: down 37.5 bps
- Today’s APR: 3.132%
- MOM change: down 17.9 bps
10-year ARM
It’s been a similar story with 10-year ARM loans. Mortgage rates on this type of loan are down to their lowest position since January 2022. Also, because of the way these home loans are structured, both 10-year and 7-year ARMs have lower annual percentage rates (APR) than any fixed rate loan today. With these terms, you would pay $1,347.13* on your mortgage each month.
- Today’s rate: 3.5%
- MOM change: down 25 bps
- Today’s APR: 3.303%
- MOM change: down 15.8 bps
Today’s takeaway
Mortgage rates on Rate loans are falling today, March 1, 2022. These rate drops can be largely attributed to investors assessing the fallout from the Russian invasion and favoring stable, low-yield assets like securities and bonds over more volatile financial vehicles.
With no end in sight for the conflict in Ukraine, these lending conditions could continue, but it’s very difficult to say one way or the other. As our own Jeremy Collette pointed out, the underlying economic issues that drove rates to their highest positions in years haven’t changed. Inflation — and just as importantly, the Fed’s attempts to control it — remains an ongoing concern.
With that in mind, it may be a good idea to jump on comparatively low rates while they’re available. If you’re ready to lock in your rate, reach out to one of our mortgage experts to start work on a new home loan or refinance.
Disclaimer
*Above scenarios assume a first lien position, 40 day rate lock on a primary residence and are subject to change without notice. Subject to underwriting guidelines and applicant’s credit profile. The actual interest rate, APR and payment may vary based on the specific terms of the loan selected, verification of information, your credit history, the location and type of property, and other factors as determined by Lender. Contact Rate for more information and up to date rates.
**Basis points (bps) measure the percentage change on interest rates. One basis point represents a 0.01% shift.
***Jeremy Collett is Rate’s Executive Director of Capital Markets. Market Updates are designed to provide readers with a high-level yet insightful view of how economic news, events and trends affect mortgage rates and the homebuying process.
Interest rates are based on a borrower profile fitting the following criteria:
- Zip code: 60031
- Home type: Single-family house
- Purchase price: $375,000
- Down payment: 20% ($75,000)
- Mortgage balance: $300,000
- FICO score: 740+
- Military member: No