US Mortgage Rates Ease After Fed Rate Cut
Location: McLean
Author:
Eileen Fitzpatrick
Date: Friday, August 24, 2007
Freddie Mac (NYSE:FRE) yesterday released the results of its Primary Mortgage Market Survey (PMMS) in which the 30-year fixed-rate mortgage (FRM) averaged 6.52 percent with an average 0.4 point for the week ending August 23, down from last week when it averaged 6.62. Last year at this time, the 30-year FRM averaged 6.48 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.34 percent this week, with an average 0.6 point, down from last week when it averaged 6.35 percent. A year ago, the 5-year ARM averaged 6.14 percent.
One-year Treasury-indexed ARMs averaged 5.60 percent this week with an average 0.6 point, down from last week when it averaged 5.67 percent. At this time last year, the 1-year ARM averaged 5.60 percent. (Average commitment rates should be reported along with average fees and points to reflect the total cost of obtaining the mortgage.)
“Interest rates on conforming long-term fixed-rate mortgages and one-year adjustable rate mortgages trended down by about one-tenth of a percent in the past week,” said Frank Nothaft, Freddie Mac vice president and chief economist. “This is as a result of yields on Treasury securities coming down, and the Fed’s decision to cut the discount rate by half a percent to 5.75 percent last Friday.
“Additionally, economic indicators released in the past week reflect slowing housing activity in July. Last month’s housing starts dropped to the lowest level since January 1997 at an annualized pace of 1.38 million units, while one-unit housing starts experienced the fourth consecutive month of decline. Building permits also fell to the lowest level in nearly 11 years, and the number of one-unit permits issued was at the lowest since June 1995.”
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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 | 6.52 | 0.4 | 6.18 | 0.5 |
| Northeast | 6.59 | 0.2 | 6.23 | 0.2 |
| Southeast | 6.49 | 0.5 | 6.16 | 0.6 |
| North Central | 6.55 | 0.3 | 6.20 | 0.3 |
| Southwest | 6.55 | 0.3 | 6.24 | 0.3 |
| West | 6.46 | 0.7 | 6.12 | 0.8 |
|
Adjustable–Rate Mortgages |
||||||
| 5/1 ARM Commitment Rate | Fees & Points |
Margin |
1 Year ARM Commitment Rate | Fees & Points | Margin | |
| US | 6.34 | 0.6 | 2.76 | 5.60 | 0.6 | 2.75 |
| Northeast | 6.33 | 0.5 | 2.77 | 5.58 | 0.7 | 2.76 |
| Southeast | 6.39 | 0.6 | 2.76 | 5.65 | 0.5 | 2.76 |
| North Central | 6.44 | 0.4 | 2.76 | 5.65 | 0.6 | 2.75 |
| Southwest | 6.41 | 0.4 | 2.78 | 5.79 | 0.6 | 2.81 |
| West | 6.24 | 0.8 | 2.74 | 5.50 | 0.7 | 2.71 |
PRIMARY MORTGAGE MARKET SURVEY RESULTS
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|
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|
US |
NE |
SE |
NC |
SW |
W |
|
| AVERAGE |
6.52 |
6.59 |
6.49 |
6.55 |
6.55 |
6.46 |
| Fees & Points |
0.4 |
0.2 |
0.5 |
0.3 |
0.3 |
0.7 |
15-YEAR FIXED RATE MORTGAGES
|
|
||||||
|
US |
NE |
SE |
NC |
SW |
W |
|
| AVERAGE |
6.18 |
6.23 |
6.16 |
6.20 |
6.24 |
6.12 |
| Fees & Points |
0.5 |
0.2 |
0.6 |
0.3 |
0.3 |
0.8 |
5/1 ADJUSTABLE RATE MORTGAGES (ARMs)
|
|
||||||
|
US |
NE |
SE |
NC |
SW |
W |
|
| AVERAGE |
6.34 |
6.33 |
6.39 |
6.44 |
6.41 |
6.24 |
| Fees & Points |
0.6 |
0.5 |
0.6 |
0.4 |
0.4 |
0.8 |
1-YEAR ADJUSTABLE RATE MORTGAGES (ARMs)
|
|
||||||
|
US |
NE |
SE |
NC |
SW |
W |
|
| AVERAGE |
5.60 |
5.58 |
5.65 |
5.65 |
5.79 |
5.50 |
| Fees & Points |
0.6 |
0.7 |
0.5 |
0.6 |
0.6 |
0.7 |
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 |
6.48 |
6.18 |
6.14 |
5.60 |
| Fees & Points |
0.4 |
0.4 |
0.5 |
0.7 |
|
|
||||
|
|
One Week Ago | |||
|
|
30-YR FRM |
15-YR FRM |
5/1 ARM |
1-YR ARM |
| AVERAGE |
6.62 |
6.30 |
6.35 |
5.67 |
| Fees & Points |
0.4 |
0.5 |
0.5 |
0.6 |
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