Mortgage rates are expected to fall further as coronavirus concerns grow

The deadly coronavirus outbreak in China that has spread to other countries is starting to have an impact on mortgage rates, with U.S. Treasuries falling to their lowest levels since October. Investors are retreating to safehaven asset classes amid an uptick in reported cases around the world, which could send mortgage rates even lower than the current rate of 3.77 percent, according to Bankrate’s national survey of mortgage lenders. The 10-year Treasury yield, which is closely tied to mortgage rates, fell 7 basis points Monday to 1.61 percent, according to Bloomberg. Stocks retreated as well, with the Dow Jones Industrial Average plunging more than 400 points Monday morning. “Nervous markets are often good news for mortgage rates, and the current nervousness about coronavirus is no exception,” says Greg McBride, CFA, Bankrate chief financial analyst. “Market concerns about the possible economic impact of the virus are driving bond yields and mortgage rates lower.” Homebuyers and refinancers, currently enjoying historically low rates, will likely see even lower rates in the coming weeks. Black Knight data shows that the mortgages of some 7.8 million Americans, with the current 3.77 percent average interest rate for a 30-year fixed-rate mortgage, according to Bankrate’s national survey of mortgage lenders, are refinance eligible. “A good refinancing opportunity is now even better. But there’s no telling how long this persists. Sentimentdriven moves are very susceptible to what is in the headlines,” McBride says. Visit Bankrate online at http://www. bankrate.com.