HOUSING FINANCE

Mortgage Interest Rates

The contract mortgage interest rate for 30-year, fixed-rate, conventional mortgages reported by Freddie Mac increased to 6.09 percent in the first quarter of 2003, 2 basis points higher than the previous quarter but 88 basis points lower than the first quarter of 2002. Adjustable-rate mortgages in the first quarter of 2003 were going for 4.24 percent, 6 basis points above the previous quarter but 84 basis points below the first quarter of 2002. Fixed-rate, 15-year mortgages, at 5.49 percent, were up 2 basis points from the fourth quarter of the past year but were down 97 basis points from the first quarter of 2002.

FHA 1–4 Family Mortgage Insurance*

Applications for FHA mortgage insurance on 1–4 family homes were received for 431,500 (not seasonally adjusted) properties in the first quarter of 2003, up 8 percent from the previous quarter and up 23 percent from the first quarter of 2002. Total endorsements or insurance policies issued totaled 330,400, up 14 percent from the fourth quarter of 2002. Purchase endorsements, at 166,500, were up 1 percent from the previous quarter but were down 23 percent from the first quarter of 2002. Endorsements for refinancings increased to 163,900, a 32-percent increase from the fourth quarter and up 19 percent from the first quarter a year ago.

PMI and VA Activity*

Private mortgage insurers issued 630,500 policies or certificates of insurance on conventional mortgage loans during the first quarter of 2003, down 4 percent from the fourth quarter of 2002 but up 16 percent from the first quarter of 2002; these numbers are not seasonally adjusted. The Department of Veterans Affairs (VA) reported the issuance of mortgage loan guaranties on 114,900 single-family properties in the first quarter of 2003, up 26 percent from the previous quarter and up 22 percent from the first quarter of 2002.

Delinquencies and Foreclosures

Total delinquencies were at 4.53 percent at the end of 2002’s fourth quarter, down 3 percent from the third quarter of 2002 and down 3 percent from the fourth quarter of 2001. Ninety-day delinquencies were 0.78, down 5 percent from the third quarter of 2002 but were up 7 percent from the fourth quarter a year ago. During the fourth quarter of 2002, 0.35 percent of loans entered foreclosure, down 5 percent from the third quarter of 2002 and down 5 percent from the fourth quarter of the previous year.