Primary Mortgage Market Survey Press Release
MORTGAGE RATES DOWN THIS WEEK AMID CONCERNS OVER LABOR MARKET
July 9, 2009
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 5.20 percent with an average 0.7 point for the week ending July 9, 2009, down from last week when it averaged 5.32 percent. Last year at this time, the 30-year FRM averaged 6.37 percent.
The 15-year FRM this week averaged 4.69 percent with an average 0.7 point, down from last week when it averaged 4.77 percent. A year ago at this time, the 15-year FRM averaged 5.91 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 4.82 percent this week, with an average 0.6 point, down from last week when it averaged 4.88 percent. A year ago, the 5-year ARM averaged 5.82 percent.
One-year Treasury-indexed ARMs averaged 4.82 percent this week with an average 0.6 point, down from last week when it averaged 4.94 percent. At this time last year, the 1-year ARM averaged 5.17 percent.
(Average commitment rates should be reported along with average fees and points to reflect the total cost of obtaining the mortgage.)
“Interest rates for 30-year fixed-rate mortgages fell for the second week in a row to the lowest level in six weeks amid market concerns over a weakening labor market,” said Frank Nothaft, Feddie Mac vice president and chief economist. “The economy lost 467,000 jobs in June, more than the market consensus, and the unemployment rate rose to 9.5 percent, the highest since August 1983. Moreover, hourly employee wages increased at an annual rate of 0.7 percent on average in the second quarter of 2009, the smallest gain since records began in 1964.
“The weak employment situation coupled with falling home values is adding to greater defaults on home equity loans and lines of credit. The American Bankers Association reported that the number of home equity loans that were 30-days or more delinquent rose to a record high of 3.52 percent in the first quarter and home equity lines of credit also reached a record of 1.89 percent. For comparison sake, such loans totaled $1.1 trillion outstanding in the first quarter of 2009, representing nearly 10 percent of all home mortgage debt, according to the Federal Reserve Board.”
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 | 5.20 | 0.7 | 4.69 | 0.7 |
| Northeast | 5.19 | 0.8 | 4.68 | 0.8 |
| Southeast | 5.19 | 0.7 | 4.76 | 0.7 |
| N. Central | 5.29 | 0.6 | 4.71 | 0.6 |
| Southwest | 5.19 | 0.5 | 4.70 | 0.5 |
| West | 5.17 | 0.7 | 4.65 | 0.7 |
| Five/One-Year Adjustable-Rate Mortgages | |||
|---|---|---|---|
| First Commitment Rate | Fees & Points | Margin | |
| US | 4.82 | 0.6 | 2.74 |
| Northeast | 4.64 | 0.7 | 2.74 |
| Southeast | 4.66 | 0.7 | 2.75 |
| N. Central | 5.02 | 0.7 | 2.74 |
| Southwest | 4.78 | 0.4 | 2.78 |
| West | 4.99 | 0.6 | 2.72 |
| One-Year Adjustable-Rate Mortgages | |||
|---|---|---|---|
| First Commitment Rate | Fees & Points | Margin | |
| US | 4.82 | 0.6 | 2.76 |
| Northeast | 4.50 | 0.5 | 2.77 |
| Southeast | 5.20 | 0.6 | 2.75 |
| N. Central | 4.75 | 0.6 | 2.73 |
| Southwest | 5.15 | 0.7 | 2.81 |
| West | 4.73 | 0.7 | 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. Freddie Mac may change the methodology used to conduct the PMMS survey 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 October 16, 2008. The new weights use the dollar volume of conventional mortgage originations within the 1-unit Freddie Mac loan limit as reported under Home Mortgage Disclosure Act (HMDA) for 2007. The weights are listed in the table below.
| Freddie Mac Region | PMMS Weights |
| Northeast | 24.2 |
| Southeast | 19.8 |
| North Central | 15.1 |
| Southwest | 12.7 |
| West | 28.2 |
Primary Mortgage Market Survey Results
July 9, 2009
| 30-Year Fixed Rate Mortgages | ||||||
|---|---|---|---|---|---|---|
| US | NE | SE | NC | SW | W | |
| Average | 5.20 | 5.19 | 5.19 | 5.29 | 5.19 | 5.17 |
| Fees & Points | 0.7 | 0.8 | 0.7 | 0.6 | 0.5 | 0.7 |
| 15-Year Fixed Rate Mortgages | ||||||
|---|---|---|---|---|---|---|
| US | NE | SE | NC | SW | W | |
| Average | 4.69 | 4.68 | 4.76 | 4.71 | 4.70 | 4.65 |
| Fees & Points | 0.7 | 0.8 | 0.7 | 0.6 | 0.5 | 0.7 |
| 5/1-Year Adjustable Rate Mortgages | ||||||
|---|---|---|---|---|---|---|
| US | NE | SE | NC | SW | W | |
| Average | 4.82 | 4.64 | 4.66 | 5.02 | 4.78 | 4.99 |
| Fees & Points | 0.6 | 0.7 | 0.7 | 0.7 | 0.4 | 0.6 |
| Margin | 2.74 | 2.74 | 2.75 | 2.74 | 2.78 | 2.72 |
| 1-Year Adjustable Rate Mortgages | ||||||
|---|---|---|---|---|---|---|
| US | NE | SE | NC | SW | W | |
| Average | 4.82 | 4.50 | 5.20 | 4.75 | 5.15 | 4.73 |
| Fees & Points | 0.6 | 0.5 | 0.6 | 0.6 | 0.7 | 0.7 |
| Margin | 2.76 | 2.77 | 2.75 | 2.73 | 2.81 | 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 | 6.37 | 5.91 | 5.82 | 5.17 | 5.32 | 4.77 | 4.88 | 4.94 |
| Fees & Points | 0.6 | 0.6 | 0.6 | 0.5 | 0.7 | 0.7 | 0.7 | 0.6 |
| Margin | N/A | N/A | 2.73 | 2.70 | N/A | N/A | 2.74 | 2.75 |