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Long- And Short-Term Rates Ease Back Slightly This Week

McLean, VA – In Freddie Mac's Primary Mortgage Market Survey, the 30-year fixed-rate mortgage (FRM) averaged 7.13 percent, with an average 0.7 point, for the week ending April 5, 2002, down from 7.18 percent last week. Last year at this time, the 30-year FRM averaged 7.01 percent.

The average for the 15-year FRM this week is 6.64 percent, with an average 0.7 point, slipping from last week's average of 6.69 percent. A year ago, the 15-year FRM averaged 6.54 percent.

One-year Treasury-indexed adjustable-rate mortgages (ARMs) averaged 4.99 percent this week, with an average 0.8 point, down from last week's average of 5.11 percent. This time last year, the one-year ARM averaged 6.23 percent.

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

"Currently the market is relatively stable while it looks to see if there are any remaining weak spots in the economy, and if so, what those spots might be," said Frank Nothaft, Freddie Mac chief economist. "But, at the moment, there seems to be nothing that would indicate anything that might seriously disrupt the market and cause mortgage rates to rise appreciably.

"Jobless claims reported today were higher than expected, which says that the labor market may not have fully recovered from the earlier economic slowdown. If this were to continue, it could create something of a drag on the economy. However, March employment figures are due out tomorrow and should reflect additional job growth for the year. Although that could put some upward pressure on mortgage rates, Freddie Mac economists expect those rates will not rise much further any time in the near future."

SUMMARY OF SURVEY RESULTS

Fixed-Rate Mortgages
 Average Conventional 30-Year Commitment Rate Fees & Points Average Conventional 15-Year Commitment Rate Fees & Points
US

7.13

7.15

7.12

7.16

7.10

7.13

0.7

0.6

0.8

0.5

0.8

0.9

6.64

6.63

6.65

6.68

6.63

6.66

0.7

0.6

0.8

0.4

0.7

0.9

Northeast
Southeast
N. Central
Southwest
West

One-Year Adjustable-Rate Mortgages
 First Commitment Rate Fees & Points Margin
US

4.99

5.05

5.01

5.11

4.78

4.98

0.8

0.7

1.0

0.6

0.8

0.9

2.78

2.78

2.77

2.79

2.78

2.78

Northeast
Southeast
N. Central
Southwest
West

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

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.

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 - 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 PMMS have been adjusted as of October 11, 2001. 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 1999. The weights are listed in the table below.

Freddie Mac RegionPMMS Weights
Northeast

22.2

Southeast

18.5

North Central

20.8

Southwest

14.4

West

24.0


Source: Freddie Mac

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