US 30-Year Rates Near Record Breaking Levels

Location: McLean
Author: Eileen Fitzpatrick
Date: Friday, November 20, 2009

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 4.83 percent with an average 0.7 point for the week ending November 19, 2009, down from last week when it averaged 4.91 percent. Last year at this time, the 30-year FRM averaged 6.04 percent.

The 15-year FRM this week averaged 4.32 percent with an average 0.6 point, down from last week when it averaged 4.36 percent. A year ago at this time, the 15-year FRM averaged 5.73 percent.

The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 4.25 percent this week, with an average 0.6 point, down from last week when it averaged 4.29 percent. A year ago, the 5-year ARM averaged 5.87 percent.

The one-year Treasury-indexed ARM averaged 4.35 percent this week with an average 0.6 point, down from last week when it averaged 4.46 percent. At this time last year, the 1-year ARM averaged 5.29 percent.

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

“Interest rate on 30-year fixed-rate mortgage loans fell for the third consecutive week to the lowest since the week ending May 21st, while 15-year fixed rates were the lowest since our records began in 1991,” said Frank Nothaft, Freddie Mac vice president and chief economist. “Low fixed rates throughout the third quarter prompted an estimated $1.1 trillion in refinancing activity, saving homeowners about $10 billion in aggregate monthly payments over the first 12 months of their new loan. Moreover, for the fourth consecutive quarter, more than 95 percent of prime borrowers who originally had an ARM selected a conventional fixed-rate mortgage in the third quarter of this year.

“Meanwhile, new home building showed some weakness in recent months. Residential construction eased 10.6 percent (annualized) between September and October, largely driven by a 33.3 percent decline in new condominium and apartment buildings and represented the slowest pace since records began in 1959. And homebuilder confidence in November remained a relatively low level, according to the National Association of Home Builders.”

Summary of Survey Results

Fixed-Rate Mortgages
	Average Conventional 30-Year Commitment Rate	Fees & Points	Average Conventional 15-Year Commitment Rate	Fees & Points
US	4.83	0.7	4.32	0.6
Northeast	4.85	0.7	4.30	0.6
Southeast	4.82	0.7	4.33	0.6
N. Central	4.90	0.6	4.37	0.5
Southwest	4.82	0.6	4.33	0.5
West	4.78	0.8	4.30	0.6

Five/One-Year Adjustable-Rate Mortgages
	First Commitment Rate	Fees & Points	Margin
US	4.25	0.6	2.74
Northeast	4.43	0.4	2.73
Southeast	4.05	0.7	2.75
N. Central	4.44	0.7	2.75
Southwest	4.14	0.6	2.75
West	4.18	0.6	2.73

One-Year Adjustable-Rate Mortgages
	First Commitment Rate	Fees & Points	Margin
US	4.35	0.6	2.75
Northeast	4.17	0.3	2.74
Southeast	4.53	0.7	2.75
N. Central	4.53	0.8	2.75
Southwest	4.19	0.8	2.78
West	4.36	0.7	2.75

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
November 19, 2009

30-Year Fixed Rate Mortgages
	US	NE	SE	NC	SW	W
Average	4.83	4.85	4.82	4.90	4.82	4.78
Fees & Points	0.7	0.7	0.7	0.6	0.6	0.8

15-Year Fixed Rate Mortgages
	US	NE	SE	NC	SW	W
Average	4.32	4.30	4.33	4.37	4.33	4.30
Fees & Points	0.6	0.6	0.6	0.5	0.5	0.6

5/1-Year Adjustable Rate Mortgages
	US	NE	SE	NC	SW	W
Average	4.25	4.43	4.05	4.44	4.14	4.18
Fees & Points	0.6	0.4	0.7	0.7	0.6	0.6
Margin	2.74	2.73	2.75	2.75	2.75	2.73

1-Year Adjustable Rate Mortgages
	US	NE	SE	NC	SW	W
Average	4.35	4.17	4.53	4.53	4.19	4.36
Fees & Points	0.6	0.3	0.7	0.8	0.8	0.7
Margin	2.75	2.74	2.75	2.75	2.78	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	6.04	5.73	5.87	5.29	4.91	4.36	4.29	4.46
Fees & Points	0.7	0.7	0.6	0.5	0.7	0.6	0.6	0.6
Margin	N/A	N/A	2.74	2.74	N/A	N/A	2.74	2.75

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.