The Federal Housing Finance Agency (FHFA) has reported that the National Average Contract Mortgage Rate for the Purchase of Previously Occupied Homes by Combined Lenders, used as an index in some adjustable-rate mortgage (ARM) contracts, was 3.90 percent based on loans closed in March. Beginning in March, FHFA is calculating interest rates using un-weighted survey data. There was a decrease of 0.18 percent from the previous month. These results reflect loans closed during the March 26-30 period.
The average interest rate on conventional, 30-year, fixed-rate mortgage loans of $417,000 or less decreased 24 basis points to 4.12 in March. These rates are calculated from the FHFA’s Monthly Interest Rate Survey of purchase-money mortgages.
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-February. The contract rate on the composite of all mortgage loans (fixed- and adjustable-rate) was 3.89 percent in March, down 16 basis points from 4.05 percent in February. The effective interest rate, which reflects the amortization of initial fees and charges, was 3.93 percent in March, was down 24 basis points from 4.17 percent in February.
Initial fees and charges were 0.93 percent of the loan balance in March, matching February. Twenty percent of the purchase-money mortgage loans originated in March were "no-point" mortgages, down 11 percent from the share in February. The average term was 27.3 years in March, down 1.5 years from 28.8 years in February. The average loan-to-price ratio in March was 74.8 percent, down 0.5 percent from 75.3 percent in February. The average loan amount was $247,100 in March, up $2,800 from $244,300 in February.