Primary Mortgage Market Survey Press Release
Mortgage Rates Start the New Year Slightly Lower Than They Ended the Old Year
January 7, 2010
Contact: corprel@freddiemac.com
or (703) 903-3933
McLean, VA – Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 5.09 percent with an average 0.7 point for the week ending January 7, 2010, down from last week when it averaged 5.14 percent. Last year at this time, the 30-year FRM averaged 5.01 percent.
The 15-year FRM this week averaged 4.50 percent with an average 0.7 point, down from last week when it averaged 4.54 percent. A year ago at this time, the 15-year FRM averaged 4.62 percent.
The 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 4.44 percent this week, with an average 0.6 point, unchanged from last week when it averaged 4.44 percent. A year ago, the 5-year ARM averaged 5.49 percent.
The 1-year Treasury-indexed ARM averaged 4.31 percent this week with an average 0.6 point, down from last week when it averaged 4.33 percent. At this time last year, the 1-year ARM averaged 4.95 percent.
(Average commitment rates should be reported along with average fees and points to reflect the total cost of obtaining the mortgage.)
"Mortgage rates eased slightly this week after rising consecutively through December," said Frank Nothaft, Freddie Mac vice president and chief economist. "Current interest rates for fixed-rate mortgages are just about at their annual average for 2009, while ARM rates are considerably below their averages for last year.
"As the economy strengthens further and the Federal Reserve (Fed) decides to raise its overnight target rate, ARM rates will follow suit because they are typically tied to shorter-term interest rates. However, the federal funds futures market does not anticipate any Fed action until the second half of 2010."
Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Over the years, Freddie Mac has made home possible for one in six homebuyers and more than five million renters.
Summary of Survey Results
| Fixed-Rate Mortgages | ||||
|---|---|---|---|---|
| Average Conventional 30-Year Commitment Rate |
Fees & Points | Average Conventional 15-Year Commitment Rate |
Fees & Points | |
| US | 5.09 | 0.7 | 4.50 | 0.7 |
| Northeast | 5.17 | 0.7 | 4.53 | 0.7 |
| Southeast | 5.07 | 0.7 | 4.52 | 0.7 |
| N. Central | 5.11 | 0.8 | 4.47 | 0.8 |
| Southwest | 5.11 | 0.5 | 4.53 | 0.5 |
| West | 5.02 | 0.7 | 4.48 | 0.7 |
| Five/One-Year Adjustable-Rate Mortgages | |||
|---|---|---|---|
| First Commitment Rate | Fees & Points | Margin | |
| US | 4.44 | 0.6 | 2.74 |
| Northeast | 4.53 | 0.4 | 2.72 |
| Southeast | 4.17 | 0.7 | 2.75 |
| N. Central | 4.62 | 0.6 | 2.74 |
| Southwest | 4.54 | 0.5 | 2.79 |
| West | 4.38 | 0.6 | 2.75 |
| One-Year Adjustable-Rate Mortgages | |||
|---|---|---|---|
| First Commitment Rate | Fees & Points | Margin | |
| US | 4.31 | 0.6 | 2.75 |
| Northeast | 4.00 | 0.5 | 2.71 |
| Southeast | 4.45 | 0.6 | 2.75 |
| N. Central | 4.35 | 0.4 | 2.73 |
| Southwest | 4.55 | 0.6 | 2.85 |
| West | 4.39 | 0.9 | 2.75 |
Freddie Mac defines its regions as follows:
Northeast: NY, NJ, PA, DE, MD, DC, VA, WV, ME, NH, VT, MA, RI, CT
Southeast: NC, SC, TN, KY, GA, AL, FL, MS, PR, VI
North Central: OH, IN, IL, MI, WI, MN, IA, ND, SD
Southwest: TX, LA, NM, OK, AR, MO, KS, CO, NE, WY
West: CA, AZ, NV, OR, WA, UT, ID, MT, HI, AK, GU
Freddie Mac's Primary Mortgage Market Survey (PMMS) is for informational purposes only and Freddie Mac is not responsible for business decisions made based on the reported results of the PMMS. In general, the data presented were calculated from information collected Monday through Wednesday of the same week that the PMMS is released and may not reflect mortgage rates, fees or points currently available from any lender. Freddie Mac may change the methodology used to conduct the PMMS at any time and without notice.
Definitions
Commitment Rate is the interest rate a lender would charge to lend mortgage money to a qualified borrower exclusive of the fees and points required by the lender. This commitment rate applies only to conventional financing on conforming mortgages with loan-to-value rates of 80 percent or less.
ARM Index - is the One-year Treasury
Loan to Value Ratio (LTV) is the ratio of the loan amount of a mortgage loan to the lower of the appraisal value or purchase price of the property securing the loan.
Origination Fees and Discount Points are the total charged by the lender at settlement. One point equals one percent of the loan amount.
Margin is a fixed amount added to the underlying index to establish the fully indexed rate for an ARM.
Weighted Averages for the Primary Mortgage Market Survey have been adjusted as of December 17, 2009. The new weights use the dollar volume of conventional first-lien mortgage originations within the 1-unit Freddie Mac loan limit as reported under the Home Mortgage Disclosure Act (HMDA) for 2008. The weights are listed in the table below.
| Freddie Mac Region | PMMS Weights |
|---|---|
| Northeast | 26.0 |
| Southeast | 16.7 |
| North Central | 15.9 |
| Southwest | 13.2 |
| West | 28.2 |
Primary Mortgage Market Survey Results
January 7, 2010
| 30-Year Fixed Rate Mortgages | ||||||
|---|---|---|---|---|---|---|
| US | NE | SE | NC | SW | W | |
| Average | 5.09 | 5.17 | 5.07 | 5.11 | 5.11 | 5.02 |
| Fees & Points | 0.7 | 0.7 | 0.7 | 0.8 | 0.5 | 0.7 |
| 15-Year Fixed Rate Mortgages | ||||||
|---|---|---|---|---|---|---|
| US | NE | SE | NC | SW | W | |
| Average | 4.50 | 4.53 | 4.52 | 4.47 | 4.53 | 4.48 |
| Fees & Points | 0.7 | 0.7 | 0.7 | 0.8 | 0.5 | 0.7 |
| 5/1-Year Adjustable Rate Mortgages | ||||||
|---|---|---|---|---|---|---|
| US | NE | SE | NC | SW | W | |
| Average | 4.44 | 4.53 | 4.17 | 4.62 | 4.54 | 4.38 |
| Fees & Points | 0.6 | 0.4 | 0.7 | 0.6 | 0.5 | 0.6 |
| Margin | 2.74 | 2.72 | 2.75 | 2.74 | 2.79 | 2.75 |
| 1-Year Adjustable Rate Mortgages | ||||||
|---|---|---|---|---|---|---|
| US | NE | SE | NC | SW | W | |
| Average | 4.31 | 4.00 | 4.45 | 4.35 | 4.55 | 4.39 |
| Fees & Points | 0.6 | 0.5 | 0.6 | 0.4 | 0.6 | 0.9 |
| Margin | 2.75 | 2.71 | 2.75 | 2.73 | 2.85 | 2.75 |
| The National Mortgage Rate Snapshot | ||||||||
|---|---|---|---|---|---|---|---|---|
| One Year Ago | One Week Ago | |||||||
| 30-YR | 15-YR | 5/1-YR | 1-YR ARM | 30-YR | 15-YR | 5/1-YR | 1-YR ARM | |
| Average | 5.01 | 4.62 | 5.49 | 4.95 | 5.14 | 4.54 | 4.44 | 4.33 |
| Fees & Points | 0.6 | 0.7 | 0.7 | 0.5 | 0.7 | 0.7 | 0.6 | 0.6 |
| Margin | N/A | N/A | 2.74 | 2.75 | N/A | N/A | 2.75 | 2.76 |