US Mortgage Rates Flat this Week Thanks Mainly to Actions by Treasury and the Fed

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 4.82 percent with an average 0.7 point for the week ending May 21, 2009, downfrom last week when it averaged 4.86 percent.  Last year at this time, the 30-year FRM averaged 5.98 percent. 

The 15-year FRM this week averaged 4.50 percent with an average 0.7 point, down from last week when it averaged 4.52 percent.  A year ago at this time, the 15-year FRM averaged 5.55 percent. 

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 4.79 percent this week, with an average 0.6 point, downfrom last week when it averaged 4.82 percent.  A year ago, the 5-year ARM averaged 5.61 percent.

One-year Treasury-indexed ARMs averaged 4.82 percent this week with an average 0.6 point, upfrom last week when it averaged 4.71 percent.  At this time last year, the 1-year ARM averaged 5.24 percent. 

(Average commitment rates should be reported along with average fees and points to reflect the total cost of obtaining the mortgage.)

“Long-term fixed-rate mortgage rates have remained below 5.0 percent for the past 10 weeks as the U.S. Treasury and Federal Reserve (Fed) act to keep interest rates low through security purchases,” said Frank Nothaft, Freddie Mac vice president and chief economist.  “The Treasury purchased $136 billion in mortgage-backed securities through April and the Fed bought $740 billion through mid-May.  In addition, the Fed purchased $115 billion in Treasury bonds since March of this year.

“Housing construction continued to decline, as total starts fell to the lowest level since the Census Bureau began its monthly series in January 1959.  While single-family construction appears to be near or at a bottom, multi-unit construction continued to recede.  Reflecting the apparent stabilization in single-family construction levels, homebuilder confidence rose in May to the highest level since September 2008 and represented the first back-to-back up tick since February 2008.”

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.

PRIMARY MORTGAGE MARKET SURVEY RESULTS

30-YEAR FIXED RATE MORTGAGES

15-YEAR FIXED RATE MORTGAGES

5/1 ADJUSTABLE RATE MORTGAGES (ARMs)

Margin                        2.74                2.72               2.75                2.74                2.78             2.73

1-YEAR ADJUSTABLE RATE MORTGAGES (ARMs)

Margin                        2.75                2.72               2.75                2.72                2.83             2.75

THE NATIONAL MORTGAGE RATE SNAPSHOT

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 survey at any time and without notice.