December 22 Best Mortgage Interest Rates and Lock Recommendation

Here is today's look at best mortgage rates, (which do not include discount points, origination points, or loan level risk based price adjustments) provided by Mortgage News Daily, Freddie Mac, and other sources. Note that Freddie Mac's AVERAGE rates are typically higher than BEST rates, because average rates include surcharges for risks associated with property types, down payments, and credit scores. To be eligible for BEST rates, borrowers need spotless credit (740 score or better), a sizable down payment (20-25%) or equity amount, and stable, adequate, and documentable income. In addition, the property must be located in a healthy (not declining) market and must be conventionally built.

*** LOCK ALERT *** RATES CONTINUE RISE, EXPECT VOLATILITY ***

Today's bond and mortgage-backed securities (MBS) markets are down again as yesterday's selling continues�� this morning's trading. Stocks are gaining smartly and are contributing to the price drops (and therefore interest rate increases) in MBS. The Dow is up about 50 points while the Nasdaq has gained about 10 points. The bond market is off by 15/32, which will probably push this morning's mortgage rates up by approximately .375 - .500 of a discount point.

Click on the mortgage rate table for the latest mortgage loan rates.

If closing in the next 7 days, I would LOCK ; otherwise, I would FLOAT my rate. This is only an opinion--what I would do if I were closing a mortgage at this time. Your decision may depend on other factors such as the strength of your loan approval and your tolerance for risk, and must be made with those in mind.

Liz Freeman has more than a decade of mortgage lending experience. She writes about mortgage and finance issues and is a regular contributor to Mortgage News Daily.