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FHFA Reports Mortgage Interest Rates, June 2010

FOR IMMEDIATE RELEASE
7/27/2010

​Washington, D.C. – The Federal Housing Finance Agency today reported that the National Average Contract Mortgage Rate for the Purchase of Previously Occupied Homes by Combined Lenders, used as an index in some ARM contracts, was 4.91 percent based on loans closed in June. This is a decrease of 0.08 percent from the previous month. This Contract Rate series can be found at www.fhfa.gov/DataTools/Downloads/Pages/Monthly-Interest-Rate-Data.aspx.

 National Average Contract Mortgage Rate Graph: June 2009 - June 2010

Source: FHFA

The average interest rate on conventional 30-year, fixed-rate, mortgage loans of $417,000 or less decreased 12 basis points to 5.00 percent in June. The average interest rate on 15-year, fixed-rate loans of $417,000 decreased 11 basis points to 4.47 percent in June. These rates are calculated from the FHFA’s Monthly Interest Rate Survey (MIRS) of purchase-money mortgages. These results reflect loans closed during the June 24–30 period. Typically, the interest rate is determined 30 to 45 days before the loan is closed. Thus, the reported rates depict market conditions prevailing in mid- to late-May.

The contract rate on the composite of all mortgage loans (fixed- and adjustable-rate) was 4.90 percent in June, down 9 basis points from 4.99 percent in May. The effective interest down 8 basis points from 5.10 percent in May.

This report contains no data on adjustable-rate mortgages due to insufficient sample size.

Initial fees and charges were 0.80 percent of the loan balance in June, up 0.08 percent from 0.72 in May. This is the highest reported rate since July of 1999. This increase is driven by the declining share of "no-point" mortgages. Thirty percent of the purchase-money mortgage loans originated in June were "no-point" mortgages, down from 42 percent in May. The average term was 27.7 years in June, up 0.2 years from 27.5 years in May. The average loan-to-price ratio in June was 74.3 percent, up 0.2 percent from 74.1 percent in May. The average loan amount was $219,900 in June, up $1,300 from $218,600 in April.

Recorded information on this index is available by calling (202) 408-2940. For technical questions on this index, please call David Roderer at (202) 408-2540. The July index value will be announced on August 26, 2010.

Technical note: The data are based on a monthly survey of major lenders that are asked to report the terms and conditions on all conventional, single-family, fully amortized, purchase-money loans closed the last five working days of the month. The data thus exclude FHA-insured and VA-guaranteed mortgages, refinancing loans, and balloon loans. This month’s data are based on 7,690 reported loans from 49 lenders, representing savings associations, mortgage companies, commercial banks, and mutual savings banks. The effective interest rate includes the amortization of initial fees and charges over a 10-year period, which is the historical assumption of the average life of a mortgage loan. The data are weighted to reflect the shares of mortgage lending by lender size and lender type as reported in the latest release of the Federal Reserve Board’s Home Mortgage Disclosure Act data.

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The Federal Housing Finance Agency regulates Fannie Mae, Freddie Mac and the 12 Federal Home Loan Banks. These government-sponsored enterprises provide more than $5.9 trillion in funding for the U.S. mortgage markets and financial institutions

Contacts:
Corinne Russell (202) 649-3032 / Stefanie Johnson (202) 649-3030
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