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One-year ARM Ticks Up As All Other Rates Fall

October 17, 2008

Mortgage Rates Shoot Up Following Bond Yields

The turmoil in the credit markets this week pushed long-term mortgage rates higher. The 30-year fixed-rate mortgage (FRM) averaged 6.46 percent with an average 0.6 point for the week ending October 16, 2008, up from last week when it averaged 5.94 percent. Last year at this time, the 30-year FRM averaged 6.40 percent according to Freddie Mac Primary Mortgage Market Survey® (PMMS®).

The 15-year FRM this week averaged 6.14 percent with an average 0.6 point, up from last week when it averaged 5.63 percent. A year ago at this time, the 15-year FRM averaged 6.08 percent.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.14 percent this week, with an average 0.6 point, up from last week when it averaged 5.90 percent. A year ago, the 5-year ARM averaged 6.11 percent.

One-year Treasury-indexed ARMs averaged 5.16 percent this week with an average 0.6 point, up from last week when it averaged 5.15 percent. At this time last year, the 1-year ARM averaged 5.76 percent.

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

"Interest rates for 30-year fixed-rate mortgages rose this week to an 8-week high," said Frank Nothaft, Freddie Mac vice president and chief economist. "ARM rates, which tend to be based on shorter-term benchmarks, showed smaller gains in part due to the Federal Reserve's October 8 inter-meeting rate cut in the overnight lending rate.

"Recent economic reports suggest the economy is still slowing. For instance, retail sales fell for the third consecutive month by 1.2 percent in September. In addition, in its latest Beige Book, released October 15th, the Federal Reserve indicated that economic activity weakened in September across all twelve Federal Reserve Districts and that several Districts also noted that their contacts had become more pessimistic about the economic outlook."


The National Mortgage Rate Snapshop
This Week One Week Ago One Year Ago
30-Yr 15-Yr 5-Yr
ARM
1-Yr ARM
6.46 6.14 6.14 5.16
0.6 0.6 0.6 0.6
30-Yr 15-Yr 5-Yr
ARM
1-Yr ARM
5.94 5.63 5.90 5.15
0.6 0.6 0.6 0.6
30-Yr 15-Yr 5-Yr
ARM
1-Yr ARM
6.40 6.05 6.11 5.76
0.5 0.6 0.5 0.6


 



Source: Freddie Mac



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