March 2021 Mortgage Rates

At the beginning of March 2021 mortgage rates in California are at their highest levels since Spring/Summer of 2020. During the last two weeks of February the bond market sold off and that selloff really accelerated the last week of February.

The reason for the selloff originates with bond investors having concerns we’ll see a significant increase in inflation later this year. And inflation is the worse thing possible for bonds.

Fears of inflation are increasing due to the expected passage of the COVID relief bill pending in Congress.

For 16 years my team and I have offered low mortgage rates, fast closings, and exceptional service throughout California. If you are looking to purchase a home in California or refinance a current mortgage please be sure to contact me directly (you can use the contact form below or call my direct number: 1-800-550-5538) for a no-cost/no-obligation quote.

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Opportunities And Risks For March 2021 Mortgage Rates

Mortgage rates increased .375% – .625% (loan program dependent) at the end of February. Can that continues? Absolutely and homeowner’s should be cautious heading into March.

Since 2008 we’ve seen several bond selloff’s like this and the most likely outcome is that at some point in March we see the market and mortgage rates level off. It’s unlikely that you will see mortgage rates revert back to previous levels anytime soon.

There is an old saying in the mortgage industry;

Mortgage rates take the elevator up and slowly take the stairs down.

With COVID vaccinations increasing the economy should start to show signs of recovery this Spring. Add in the fact that the government is about to inject nearly two-trillion dollars as well and it’s not hard to understand why bond investors are nervous about inflation.

March 2021 Mortgage Rate Forecast For California

Here are our latest March 2021 mortgage rate forecasts for California:

  • 30-year fixed rates below 3.25%
  • 20-year fixed rates below 3.125%
  • 15-year fixed rates below 2.75%

This is based on properties in California, a loan amount of $325,000, a primary home, excellent credit (740 or higher credit score), and a Loan-To-Value ratio below 60% (purchase transactions). We may see days in which mortgage rates spike higher however overall we believe there will be opportunities to lock a mortgage rate at or below these levels throughout the month of March.

California homeowners

March 2021 Mortgage Rate Chart

Here is a quick reference guide to March 2021 mortgage rate possibilities in California (these are not quotes; just examples) and the payments associated with each level based on various conforming loan amounts. See our important disclosure below.

30-Year Fixed-Rate Mortgage:

TermLoan AmountMortgage RatePayment
30-year fixed$210,0003.125%$896.44
30-year fixed$310,0003.125%$1,327.96
30-year fixed$410,0003.125%$1,756.34
30-year fixed$510,0003.125%$2,184.71

20-Year Fixed-Rate Mortgage:

TermLoan AmountMortgage RatePayment
20-year fixed$210,0003.00%$1,164.65
20-year fixed$310,0003.00%$1,719.25
20-year fixed$410,0003.00%$2,273.85
20-year fixed$510,0003.00%$2,828.45

15-Year Fixed-Rate Mortgage:

TermLoan AmountMortgage RatePayment
15-year fixed$210,0002.625%$1,412.65
15-year fixed$310,0002.625%$2,085.34
15-year fixed$410,0002.625%$2,758.03
15-year fixed$510,0002.625%$3,430.70

Important Disclosure For March 2021 mortgage rates: The above is not a mortgage rate quote; nor is it an offer to lend. It’s only a generic example of various mortgage rates, loan amounts, and payments. Our mortgage rate chart is meant to educate and inform our readers. The current market may be higher or lower than the examples listed in these mortgage rate charts. Also; mortgage rates can and often do adjust multiple times a day. 

California Mortgage Calculator

Using a mortgage calculator to figure out your monthly payment is an essential part of buying a home in California or refinancing a current mortgage. Use our free mortgage calculator to help you determine what you can afford. With our online mortgage calculator, you can also factor in your property tax amount along with your annual homeowner’s insurance amount with your monthly mortgage payment.

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And our mortgage calculator is especially helpful for those who want to impound their property taxes and property insurance into their monthly mortgage payment. If you have any questions about or California mortgage calculator please don’t hesitate to ask.

March 2021 Mortgage Rate FAQ’s

Here we answer some popular questions about mortgage rates in California.

Can Self-Employed People Get A Mortgage?

Yes! The mortgage approval process for a self-employed person has a few more hurdles when compared to a borrower who receives a W-2 however rates/terms are the same (all things being equal).

What is the difference between a fixed and adjustable rate?

A fixed mortgage rate means that your rate and your payment will never change. An Adjustable-rate means your interest rate and monthly will change at some point in time in the future. Usually, the rate/payment is fixed for 5, 7 or 10 years.

What is a pre-payment penalty?

A pre-payment penalty is when you pay off your loan early and the lender asses a “penalty” for doing that. It is very rare to see pre-payment penalties in mortgages however it’s always a good idea to ask the Loan Officer.

Most respectable lenders stopped imposing pre-payment penalties shortly after 2008.

Is it safe to apply online for a mortgage?

Absolutely! Most if not all lenders offer the ability to complete a mortgage application online. Before you apply check the Better Business Bureau rating first to ensure it’s a respectable company. Also check their license information with the California DRE and NMLS.

Update Mortgage Guidelines March 2021

There are no major updates to mortgage guidelines for the month of March. On a side note, there is a new industry mortgage application being introduced to consumers on March 1st, 2021.

Fannie Mae’s website has some good information on the redesigned application.

Economic Calendar For March 2021

Here we cover the daily economic events that might impact mortgage rates. After the report comes out we’ll update the post with that information and comment on if there is a potential impact on the Mortgage-Backed Securities market and consumer mortgage rates.

To start things off we have:

Wednesday – March 31st:

  • MBA Purchase and MBA Refinance Index: Applications for mortgages continue to decline. The MBA Purchase Index came in at 297.3 and the Refinance Index came in at 3242.1.
  • Chicago PMI: Last month the Chicago PMI report came in at 59.5 and this month the report came in at 66.3. March 2021 mortgage rates were not affected by the report.
  • ADP National Employment: The market was expecting 550,000 jobs created however the report came in just below that (517,000 jobs created).

Tuesday – March 30th:

  • Consumer Confidence: Consumer Confidence rose to 109.7 after last month’s reading of 91.3. There was no impact on March 2021 mortgage rates.

Friday – March 26th:

  • Core PCE Inflation: Core PCE Inflation was expected to come in at 1.5% however it came in a bit lower at 1.4%. There was no immediate impact to mortgage rates in March.

Thursday – March 25th:

  • Weekly Jobless Claims: The Weekly Jobless Claims report showed a decline in the number of Americans seeking unemployment benefits. Last week the report came in at 770,000 claims and this week it was 684,000 claims.

Wednesday – March 24th:

  • MBA Purchase and Refinance Index: The Purchase Index came in at 301.9 and the Refinance Index came in at 3325.3
  • Durable Goods: The Durable Goods report showed a -1.1% decline. The report had a positive impact on mortgage rates in March.
  • PMI Manufacturing: The PMI Manufacturing report came in line with expectations (59.0).

Tuesday – March 23rd:

  • New Home Sales: Like the Existing Home Sales report, New Home Sales declined. However, it was a much steeper decline; -18.2%.

Monday – March 22nd:

  • Existing Home Sales: The February numbers for Existing Home Sales came in lower than expected. The report showed a -6.6% decline.

Thursday – March 18th:

  • Philly Fed Business Index: The Philly Fed Index Skyrocketed to its highest level in decades 51.8). Last month’s reading came in at 23.0.
  • Weekly Jobless Claims: Weekly Jobless Claims came in at 770,000 claims and continued claims came in at 4,124,000.

Wednesday – March 17th:

  • MBA Purchase and Refinance Index: The MBA Purchase Index came in at 294.3 which is higher than last week’s reading. The MBA Refinance Index came in at 3504.9 which is lower than last week’s reading.

Tuesday – March 16th:

  • Retail Sales: The Retail Sales report came in lower than expected. Expectations were for a -0.5% decline and the actual reading came in at -3.0%.
  • NAHB Housing Market Index: The NAHB Housing Market Index came in at 82. There was no immediate impact to mortgage rates.

Friday – March 12th:

  • 1yr and 5yr Inflation Outlook: The 1yr Inflation Outlook came in at 3.1% and the 5yr Inflation Outlook came in at 2.7%.
  • Consumer Sentiment: The Consumer Sentiment report came in at 83.0

Thursday – March 11th:

  • Weekly Unemployment Claims: The weekly unemployment claims report showed 712,000 Americans filed for unemployment benefits and 4,144,000 people are still receiving long-term unemployment benefits. March 2021 mortgage rates did not move on the report.

Wednesday – March 10th:

  • MBA Purchase and Refinance Index: The Purchase Index came in at 289.0 and the Refinance Index came in at 3658.8.
  • Core CPI: The annual Core CPI reading came in at 1.3%. Month-month Core CPI came in at 0.4%. March 2021 mortgage rates remained stable post report.

Friday – March 5th:

  • Employment Report: The monthly BLS Employment report showed an increase of 379,000 jobs, a 6.2% unemployment rate, and earnings increased 0.2%. A super-strong report and March 2021 mortgage rates pushed higher post report.

Thursday – March 4th:

  • Weekly Unemployment Claims: The weekly unemployment claims report showed 745,000 Americans filed for unemployment benefits and 4,295,000 people are still receiving long-term unemployment benefits.

Wednesday – March 3rd:

  • MBA Purchase and Refinance Index: Last week the Purchase Index came in at 264.9 and the Refinance Index came in at 3848.1. This week the Purchase Index came in at 269.7 and the Refinance Index came in at 3850.4.
  • ADP National Employment: Expectations are for 168,000 jobs created after last month’s report that showed 174,000 jobs created. This report came in lower than expected, with 117,000 jobs created during the month of February.

Monday – March 2nd:

  • ISM Manufacturing PMI: The market is expecting the report to come in at 58.8. This month’s ISM report came in stronger than expected (60.8) there was no immediate impact to March 2021 mortgage rates.

Mortgage Rates And The Monthly Jobs Report

This is going to be a very closely watched monthly jobs report. The market is expecting the unemployment rate to remain at 6.3% and non-farm payrolls to come in at 182,000. earnings are expected to show an increase of .2%.

Should two or three of these comments come in better than expected we could see another surge in mortgage rates.

Update;

The Employment report came in at 379,000 jobs created, the unemployment rate came in at 6.2% and earnings came in at .2%. Overall this was a very good report for the economy and a very significant increase in the number of jobs created.

This report could put pressure on bonds which will then put pressure on mortgage rates to move higher.

Fed Meeting March 17, 2021

The Fed meeting on March 17, 2021 lacked a significant surprise. Bond markets and mortgage rates improved on the day however it would turn out to be short-lived. The following day bonds sold off and mortgage rates moved higher.

From Mortgage News Daily – the day after the fed meeting;

Mortgage Rates End High After Starting Day Higher

Mortgage rates started the day in bad shape after significant bond market weakness overnight.  Treasury yields rose roughly 0.05%, and that sort of move typically coincides with mortgage rates rising nearly as much.  Today wasn’t much of an exception.  The average lender started out with effective 30yr fixed rates roughly 0.03-0.04% higher than yesterday, which means they were the highest in a year!

source: Mortgage News Daily

March 2021 Mortgage Rate Average In California

We’ll update this section as we move further into March however to start off the month we’re seeing the following averages.

  • The average 30-year fixed mortgage rate in California is 2.875%.
  • The average 20-year fixed mortgage rate is 2.75%
  • The average 15-year fixed rate in California is 2.375%.

This is an average of everyone we’re seeing; from less than perfect credit to excellent credit. Please keep in mind that March 2021 mortgage rates adjust daily; sometimes multiple times during a day. For a mortgage quote specific to your situation please be sure to contact us directly.

Mortgage-Backed Securities & Treasury Snapshot

March 29th – March 31st:

Mortgage-Backed Security UMBS 2.0 started the week at the 100.02 level and the UMBS 2.5 coupon started at the 102.84 level. The 10y Treasury yield was at the 1.65% level to start the week.

At the end of the month, Mortgage-Backed Security UMBS 2.0 was at the 99.8 level and the UMBS 2.5 coupon was nearing the 102.44 level. The 10y Treasury yield was at 1.71%.

March 22nd – March 26th:

Mortgage-Backed Security UMBS 2.0 started the week at the 99.48 level and the UMBS 2.5 coupon started at the 102.36 level. The 10y Treasury yield was at the 1.68% level to start the week.

At the end of the week, Mortgage-Backed Security UMBS 2.0 was at the 99.91 level and the UMBS 2.5 coupon was nearing the 102.75 level. The 10y Treasury yield was at 1.66%.

March 15th – March 19th:

Mortgage-Backed Security UMBS 2.0 started the week at the 100.20 level and the UMBS 2.5 coupon started at the 103.00 level. The 10y Treasury yield was at the 1.61% level to start the week.

At the end of the week, Mortgage-Backed Security UMBS 2.0 was at the 99.47 level and the UMBS 2.5 coupon was nearing the 102.39 level. The 10y Treasury yield was at 1.73%.

March 8th – March 12th:

Mortgage-Backed Security UMBS 2.0 started the week at the 100.68 level and the UMBS 2.5 coupon started at the 103.44 level. The 10y Treasury yield was at the 1.57% level to start the week.

At the end of the week, Mortgage-Backed Security UMBS 2.0 was at the 100.22 level and the UMBS 2.5 coupon was nearing the 103.03 level. The 10y Treasury yield was at 1.61%.

March 2nd – March 6th:

Mortgage-Backed Security UMBS 2.0 started the week at the 101.19 level and the UMBS 2.5 coupon started at the 103.88 level. The 10y Treasury yield was at the 1.41% level to start the week.

At the end of the week, Mortgage-Backed Security UMBS 2.0 was at the 100.67 level and the UMBS 2.5 coupon was nearing the 103.41 level. The 10y Treasury yield was at 1.57%.

Loan Officer Kevin O'Connor

About The Author

Loan Officer Kevin O'Connor has over 16 years of experience as a Mortgage Loan Originator and is licensed with the state of California and the Nationwide Mortgage Licensing System. He has a top rating with the Better Business Bureau, Google, Yelp, and Zillow. CA DRE #01499872 / NMLS #247447

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