Mixed Economic Signals Keep US Mortgage Rates Flat this Week
Location: McLean
Author:
Eileen Fitzpatrick
Date: Friday, December 15, 2006
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 5.92 percent this week, with an average 0.6 point, unchanged from last week. A year ago, the five-year ARM averaged 5.77 percent.
One-year Treasury-indexed ARMs averaged 5.45 percent this week with an average 0.8 point, up from last week when it averaged 5.43 percent. At this time last year, the one-year ARM averaged 5.15 percent.
(Average commitment rates should be reported along with average fees and points to reflect the total cost of obtaining the mortgage.)
“Mixed economic reports have kept mortgage rates from making any drastic changes this week,” said Frank Nothaft, Freddie Mac vice president and chief economist. “On the upside, there was stronger job growth and greater than expected retail sales in November. Offsetting that news was weaker wage growth in that same time frame and lower indications of consumer sentiment in December.
“Long-term mortgage rates, while expected to rise over the new year, will very likely not get up to even 7 percent, which will help to moderate the current weakness in the housing market.”
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SUMMARY OF SURVEY RESULTS |
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Fixed-Rate Mortgages |
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| Average Conventional 30-Year Commitment Rate | Fees & Points | Average Conventional 15-Year Commitment Rate | Fees & Points | |
| US | 6.12 | 0.4 | 5.86 | 0.5 |
| Northeast | 6.15 | 0.3 | 5.86 | 0.4 |
| Southeast | 6.08 | 0.6 | 5.85 | 0.5 |
| North Central | 6.16 | 0.3 | 5.86 | 0.4 |
| Southwest | 6.10 | 0.4 | 5.86 | 0.4 |
| West | 6.10 | 0.5 | 5.85 | 0.5 |
|
Adjustable–Rate Mortgages |
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| 5/1 ARM Commitment Rate | Fees & Points | Margin | 1 Year ARM Commitment Rate | Fees & Points | Margin | |
| US | 5.92 | 0.6 | 2.76 | 5.45 | 0.8 | 2.76 |
| Northeast | 5.92 | 0.5 | 2.76 | 5.45 | 0.8 | 2.75 |
| Southeast | 5.91 | 0.8 | 2.76 | 5.44 | 0.8 | 2.76 |
| North Central | 5.98 | 0.3 | 2.78 | 5.50 | 0.6 | 2.76 |
| Southwest | 5.90 | 0.7 | 2.77 | 5.45 | 0.7 | 2.78 |
| West | 5.92 | 0.7 | 2.74 | 5.42 | 0.9 | 2.75 |
Freddie Mac defines its regions as follows:
Northeast: NY, NJ, PA, DE, MD, DC, VA, WV, PR, ME, NH, VT, MA, RI, CT, VI
Southeast: NC, SC, TN, KY, GA, AL, FL, MS
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
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 26, 2006. The new weights use the dollar volume of
conventional mortgage originations within the 1-unit Freddie Mac loan
limit as reported under the Home Mortgage Disclosure Act (HMDA) for 2005.
The weights are listed in the table below.
|
Freddie Mac Region |
PMMS Weights |
|
Northeast |
24.5 |
|
Southeast |
18.6 |
|
North Central |
15.4 |
|
Southwest |
10.4 |
|
West |
31.0 |
PRIMARY MORTGAGE MARKET SURVEY RESULTS
30-YEAR FIXED RATE MORTGAGES
|
|
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|
US |
NE |
SE |
NC |
SW |
W |
|
| AVERAGE |
6.12 |
6.15 |
6.08 |
6.16 |
6.10 |
6.10 |
| Fees & Points |
0.4 |
0.3 |
0.6 |
0.3 |
0.4 |
0.5 |
15-YEAR FIXED RATE MORTGAGES
|
|
||||||
|
US |
NE |
SE |
NC |
SW |
W |
|
| AVERAGE |
5.86 |
5.86 |
5.85 |
5.86 |
5.86 |
5.85 |
| Fees & Points |
0.5 |
0.4 |
0.5 |
0.4 |
0.4 |
0.5 |
5/1 ADJUSTABLE RATE MORTGAGES (ARMs)
|
|
||||||
|
US |
NE |
SE |
NC |
SW |
W |
|
| AVERAGE |
5.92 |
5.92 |
5.91 |
5.98 |
5.90 |
5.92 |
| Fees & Points |
0.6 |
0.5 |
0.8 |
0.3 |
0.7 |
0.7 |
1-YEAR ADJUSTABLE RATE MORTGAGES (ARMs)
|
|
||||||
|
US |
NE |
SE |
NC |
SW |
W |
|
| AVERAGE |
5.45 |
5.45 |
5.44 |
5.50 |
5.45 |
5.42 |
| Fees & Points |
0.8 |
0.8 |
0.8 |
0.6 |
0.7 |
0.9 |
THE NATIONAL MORTGAGE RATE SNAPSHOT
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|
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|
One Year Ago | |||
|
|
30-YR FRM |
15-YR FRM |
5/1 ARM |
1-YR ARM |
| AVERAGE |
6.30 |
5.85 |
5.77 |
5.15 |
| Fees & Points |
0.5 |
0.5 |
0.5 |
0.6 |
|
|
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|
One Week Ago | |||
|
|
30-YR FRM |
15-YR FRM |
5/1 ARM |
1-YR ARM |
| AVERAGE |
6.11 |
5.84 |
5.92 |
5.43 |
| Fees & Points |
0.5 |
0.5 |
0.5 |
0.7 |
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
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