HOUSING FINANCE

Mortgage Interest Rates

Mortgage interest rates increased between 6 and 12 basis points on fixed-rate mortgages from the previous quarter but decreased between 119 and 133 basis points from a year ago. The contract mortgage interest rate for 3 0 - y e a r, fixed-rate, conventional mortgages reported by Freddie Mac was 7.13 percent in the second quarter of 2001, 12 basis points higher than the previous quarter but 119 basis points lower than the second quarter of 2000. Adjustable-rate mortgages in the second quarter were going for 5.93 percent, 55 basis points below the previous quarter and 110 basis points below the second quarter of 2000. Fixed-rate, 15-year mortgages, at 6.66 percent, were up 6 basis points during the second quarter but were 133 basis points below the same quarter in 2000.

FHA 1-4 Family Mortgage Insurance*

Applications for FHA mortgage insurance on 1-4 family homes were received for 460,400 (not seasonally adjusted) properties in the second quarter of 2001, up 2 percent from the previous quarter and up 42 percent from the second quarter of 2000. Total endorsements or insurance policies issued totaled 279,200, up 17 percent from the first quarter of 2001. Purchase endorsements at 186,700 were unchanged from the second quarter of 2001 but were down 8 percent from the second quarter 2000. Endorsements for refinancings increased to 92,500, a 75-percent rise from the previous quarter, and were up 553 percent from the second quarter a year ago.

PMI and VA Activity*

Private mortgage insurers issued 527,900 policies or certificates of insurance on conventional mortgage loans during the second quarter of 2001, up 47 percent from the first quarter of this year and up 65 percent from the second quarter of 2000; these numbers are not seasonally adjusted. The U.S. Department of Veterans Affairs reported the issuance of mortgage loan guaranties on 72,600 single-family properties in the second quarter of 2001, up 2 percent from the previous quarter and up 67 percent from the second quarter of 2000.

Delinquencies and Foreclosures

Total delinquencies were at 4.37 percent at the end of 2001’s first quarter, down 4 percent from the fourth quarter of 2000 but up 17 percent from the first quarter of 2000. Ninety-day delinquencies were at 0.65 percent , up 5 percent from the fourth quarter of 2000 and up 20 percent from the same quarter a year ago. During the first quarter of 2001, 0.31 percent of loans entered foreclosures, up 7 percent from the fourth quarter of 2000 and up 3 percent from the first quarter of the previous year.