Mortgage Rates Today, Thursday, April 9: Slightly Higher

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We’re seeing higher mortgage interest rates this morning as the Iran ceasefire struggles to stand on shaky Bambi legs. Will it find its footing? Time will tell, though where rates go may be less about what’s actually going on overseas and more how the markets feel about current events.

The average interest rate on a 30-year, fixed-rate mortgage rose to 6.24% APR, according to rates provided to NerdWallet by Zillow. This is five basis points higher than yesterday but seven basis points lower than a week ago. (See our chart below for more specifics.) A basis point is one one-hundredth of a percentage point.

We also got some new inflation numbers this morning that showed that as bad as we think March was, February wasn’t so great, either. Keep reading below the chart for details.

Average mortgage rates, last 30 days

📉 When will mortgage rates drop?

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.

We’re starting to get economic data — the stuff the Nerds focus on in normal times, since it often provides clues about where rates will go — that could begin to quantify the effects of the Iran conflict on the U.S. economy. These reports can be significant predictors of the Federal Reserve’s actions, since keeping the economy healthy is the Fed’s fundamental job. The central bankers attempt to do this by encouraging maximum employment (basically, a labor market where if you want a job, you can get a job) and price stability (keeping inflation in check so prices and consumer behavior are predictable).

Even though the Fed does not set mortgage rates, its actions ripple out through the economy. We often see mortgage rates head higher or lower on expectations of action from the Federal Reserve. If it doesn’t look like the central bankers will be in a rate cutting mood — and for this month’s meeting, it most certainly does not — we shouldn’t expect downward pressure on mortgage rates.

Last week, we got data on the employment front. The Bureau of Labor Statistics released the March jobs report April 3, revealing much stronger gains than expected (+178,000 vs. a projected +60,000). On one hand, yay. But on the other hand, the BLS collects data focused on the pay period that includes the 12th of the month, so really, we’re seeing a reflection of the first two weeks of the war.

Still, the Federal Reserve is unlikely to view this neither alarming nor impressive employment landscape as an imminent threat to the economy. That means jobs can take a backseat to inflation, which isn’t just creating anxiety for the markets: Rising grocery and gas prices already have many Americans feeling financially stretched.

This morning we got the first of two major inflation reports coming out this week. We’ve got the Consumer Price Index (CPI) on tap for tomorrow, and today brought new numbers from the Personal Consumption Expenditures Price Index (PCE).

Well, they’re not that new. PCE may be the Fed’s preferred inflation measure, but since the Bureau of Economic Analysis is still playing catch-up from last fall’s government shutdown, today’s data is from February. Yep, the Before Times. The biggest yikes? Things were already not going well pre-Iran.

“Goods inflation quickened in February, driving overall price growth higher before the military conflict in Iran began,” says NerdWallet senior economist Elizabeth Renter. “While gas inflation is highly volatile, often bouncing between positive and negative, there’s little doubt we’ll continue to see it travel in the same direction — upwards — when we see March and April data.”

The Bureau of Labor Statistics is back on track and releasing the latest CPI numbers on time, so we don’t have to wait long for March inflation data. We’ll have the CPI in hand in less than 24 hours. Though CPI is less comprehensive than PCE, it’s what most people who aren’t Fed governors use to track inflation.

Any hopes for a spring rate cut from the Federal Reserve have already been extinguished. But if the CPI’s looking grim, forget spring — the odds of a Fed rate cut this year will dwindle.

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 could start considering a refi if your current rate is around 6.74% 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.

🏡 Should I start shopping for a home?

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.

🔒 Should I lock my rate?

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.

🤓 Nerdy Reminder: Rates can change daily, and even hourly. If you’re happy with the deal you have, it’s okay to commit.

🧐 Why is the rate I saw online different from the quote I got?

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:

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

👀 If I apply now, can I get the rate I saw today?

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.

About the author

Kate Wood is a lending expert and certified financial health counselor (CHFC) who joined NerdWallet in 2019. With an educational background in sociology, Kate feels strongly about issues like inequality in homeownership and higher education, and relishes any opportunity to demystify government programs. Prior to NerdWallet, she wrote about home remodeling, decor and maintenance for This Old House.

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