HOUSING FINANCE

Mortgage Interest Rates

Mortgage interest rates increased between 2 and 35 basis points from the previous quarter. The contract mortgage interest rate for 30-year, fixed-rate, conventional mortgages reported by Freddie Mac was 8.32 percent in the second quarter of 2000, 6 basis points higher than the previous quarter and 112 basis points higher than the second quarter of 1999. Adjustable-rate mortgages in the second quarter were going for 7.03 percent, 35 basis points above the previous quarter and 129 basis points above the second quarter of 1999. Fixed-rate, 15-year mortgages, at 7.99 percent, were up 13 basis points during the second quarter and 117 basis points above the same quarter in 1999. The FHA rate increased 2 basis points to 8.32 percent during the second quarter of this year and was 116 basis points above the same quarter in 1999.

Sources: Federal Home Loan Mortgage Corporation; Office of Housing, Department of Housing and Urban Development

FHA 1-4 Family Mortgage Insurance*

Applications for FHA mortgage insurance on 1-4 family homes were received for 324,100 (not seasonally adjusted) properties in the second quarter of 2000, up 17 percent from the previous quarter but down 23 percent from the second quarter of 1999. Total endorsements or insurance policies issued totaled 216,700, up 1 percent from the second quarter of 1999. Purchase endorsements were 202,600, up 5 percent from the first quarter but down from 246,600 or 18 percent from the second quarter of 1999. Endorsements for refinancings declined to 14,200 or 29 percent from the previous quarter and decreased 85 percent from the second quarter a year ago.

*Units in thousands of properties. Source: Office of Housing, Department of Housing and Urban Development

PMI and VA Activity*

Private mortgage insurers issued 320,100 policies or certificates of insurance on conventional mortgage loans during the second quarter of 2000, up 30 percent from the first quarter but down 16 percent from the second quarter of 1999; these numbers are not seasonally adjusted. The U.S. Department of Veterans Affairs reported the issuance of mortgage loan guaranties for 43,400 single-family properties in the second quarter of 2000, down 8 percent from the previous quarter and down 67 percent from the second quarter of 1999.

*Units in thousands of properties. Sources: PMI-Mortgage Insurance Companies of America; VA-Department of Veterans Affairs

Delinquencies and Foreclosures

Total delinquencies were at 3.72 percent at the end of 2000's first quarter, down 5 percent from the fourth quarter of 1999 and down 10 percent from the first quarter of 1999. Ninety-day delinquencies were at 0.54 percent, down 4 percent from the fourth quarter of 1999 and down 11 percent from the same quarter a year ago. During the first quarter of 2000, 0.30 percent of loans entered foreclosures, down 3 percent from the fourth quarter of 1999 and down 9 percent from the first quarter of the previous year.

Source: National Delinquency Survey, Mortgage Bankers Association