Idaho Mortgage Rate Outlook

Mortgage Rate Outlook: Week of February 3, 2025

Mortgage rates may start the week slightly worse than Friday, but not by much. While the bond market remains stable for now, things could change as traders assess the impact of newly implemented tariffs. This week has the potential to be volatile, setting the tone for mortgage rates for the rest of February.

Key Factors Impacting Mortgage Rates This Week

1. Tariffs on Canada, Mexico, and China

Tariffs were officially put in place on Saturday but don’t actually go into effect until tomorrow. So far, bond markets have taken this in stride, as the threat of tariffs has been priced in for months. However, traders will be closely watching for any new developments that could shake up the market.

Additionally, there are rumors that tariffs on the European Union may be next. No timeline has been set, but if the U.S. moves forward with this, we could see more market uncertainty, which could impact mortgage rates.

2. Packed Economic Calendar

This week is also loaded with key labor market data, which could influence rates depending on how the reports shake out:
📌 JOLTS Job Openings Report
📌 ADP Private Payrolls Report
📌 Weekly Jobless Claims
📌 BLS Jobs Report (Friday)

If the labor market shows signs of slowing, mortgage rates could benefit. But if hiring remains strong, rates could push higher.

3. U.S. Debt Concerns & Treasury Policy

Bond traders are also paying close attention to how the U.S. plans to manage its debt under the new Treasury administration. The concern? A potential shift toward long-term debt issuance instead of short-term T-bills.

🔹 Why This Matters: Short-term debt has little effect on mortgage rates, but long-term debt impacts the 10-year Treasury yield—one of the key indicators for mortgage rate movement. If the government shifts towards long-term debt, we could see upward pressure on mortgage rates in the coming months.

Should You Lock or Float Your Mortgage Rate?

📌 Loans Closing in Less Than 15 Days
🔹 Consider locking your rate if you’re not comfortable taking on risk.
🔹 No time to wait for corrections if markets move in the wrong direction.
🔹 If you’re willing to take the risk, rates could improve next week—but no guarantees.

📌 Loans Closing in 15–30 Days
🔹 Cautiously float, but be ready to lock if markets move against you.
🔹 It’s too early to predict exactly how the market will react to tariffs and job reports.
🔹 Stay in close contact with your lender for updates.

📌 Loans Closing in 30+ Days
🔹 Floating is generally safe for now.
🔹 As your closing date approaches, assess risk and prepare to lock accordingly.

Final Thoughts

This week has all the ingredients for mortgage rate volatility, with tariffs taking effect and a busy economic calendar. While today’s rate sheets may be slightly worse than Friday’s, they could shift throughout the week based on how markets respond to new data.

📢 Need guidance on locking in the best mortgage rate? Use our Idaho Mortgage Calculator or reach out to our team for expert advice.

🏡 Thinking about buying or refinancing? Let’s chat and find the best strategy for your loan!