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Mortgage Rates Up Again As Originations Begin To Level Off

October 28, 2005

Refi Share Of The Market Will Start To Decline As Rates Continue To Rise

McLean, VA – The Freddie Mac (NYSE:FRE) Primary Mortgage Market SurveySM (PMMSSM) found that the 30-year fixed-rate mortgage (FRM) averaged 6.15 percent, with an average 0.5 point, for the week ending October 27, 2005, up from last week's average of 6.10 percent. Last year at this time, the 30-year FRM averaged 5.64 percent.

The average for the 15-year FRM this week is 5.69 percent, with an average 0.5 point, up from last week when it averaged 5.65 percent. A year ago, the 15-year FRM averaged 5.01 percent

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 5.63 percent this week, with an average 0.6 point, up from last week when it averaged 5.59 percent. There is no annual historical information for last year since Freddie Mac only began tracking this mortgage rate at the start of this year.

One-year Treasury-indexed ARMs averaged 4.91 percent this week, with an average 0.7 point, up from last week when it averaged 4.89 percent. At this time last year, the one-year ARM averaged 3.96 percent.

"Although home sales were still impressive in September, mortgage applications in October seem to be tapering off a bit, due in large part to slowly rising interest rates," said Frank Nothaft, Freddie Mac vice president and chief economist. "Obviously, refinancing is going to take the biggest hit as mortgage rates tick up. Refinancing comprised about 40 percent or more of the total volume of mortgage originations over the last 13 months. This share, however, will lessen as mortgage rates continue to rise.

"Going forward, homeowners wanting to use some of the equity in their homes for home improvement or other purposes will make up a larger portion of the refinance business."

The National Mortgage Rate Snapshop
This Week One Week Ago One Year Ago
30-Yr 15-Yr 5-Yr
ARM
1-Yr ARM
6.15 5.69 5.63 4.91
0.5 0.5 0.6 0.7
30-Yr 15-Yr 5-Yr
ARM
1-Yr ARM
6.10 5.65 5.59 4.89
0.5 0.5 0.7 0.7

Source: Freddie Mac



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SecurityMetrics for PCI Compliance, QSA, IDS, Penetration Testing, Forensics, and Vulnerability Assessment
30-Yr 15-Yr 5-Yr
ARM
1-Yr ARM
5.64 5.01 --- 3.96
0.7 0.7 --- 0.8