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 3.29 percent based on loans closed in December. There was a decrease of 0.07 from the previous month. The average interest rate on conventional, 30-year, fixed-rate mortgage loans of $417,000 or less decreased seven basis points to 3.47 in December. These rates are calculated from the FHFA’s Monthly Interest Rate Survey of purchase-money mortgages (see technical note). These results reflect loans closed during the Dec. 24-31 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-November. The contract rate on the composite of all mortgage loans (fixed- and adjustable-rate) was 3.28 percent in December, down 8 basis points from 3.36 percent in November. The effective interest rate, which reflects the amortization of initial fees and charges, was 3.42 percent in December, down seven basis points from 3.49 percent in November. This report contains no data on adjustable-rate mortgages due to insufficient sample size. Initial fees and charges were 1.15 percent of the loan balance in December, up seven basis points from November. Fifteen percent of the purchase-money mortgage loans originated in December were “no-point” mortgages, down from 16 percent from the share in November. The average term was 27.4 years in December, constant from November. The average loan-to-price ratio in December was 76.3 percent, up 0.6 percent from 75.7 percent in November. The average loan amount was $274,100 in December up $1,800 from $272,300 in November.