The National Average Contract Mortgage Rate for the Purchase of Previously Occupied Homes by Combined Lenders index ended up at 4.38 percent. This index is calculated using FHFA’s monthly interest rate survey. Since interest rates are generally locked for 30-45 days before the loan is closed, the September data reflects mortgage market rates for mid to late August. The effective interest rate, which includes all charges that are considered finance charges, was 4.51 percent, also up .11 percent from the month before.
"Interest rates are higher than they were a few months ago but they still remain at a very attractive rate." stated Craig McKenzie, Realtor(r) with Whidbey Island Windermere Real Estate. "Coupled with increasing home prices, it is time to make the home buying decision."
FHFA’s interest rate survey is for conventional, 30-year, fixed-rate mortgages only, took a higher jump of .14 percent, coming in at 4.63 percent for September. The average loan amount for for all loans in September dropped from $274,500 to $270,100. The survey is not a compilation of all mortgages made over the month, but a survey of a small monthly survey of mortgage lenders, showing the terms and conditions of all conventional, single family, fully amortized purchase-money loans during the last five days of the month. Refinances, including those in the HARP program are not calculated in the survey.
The FHFA regulates Fannie Mae and Freddie Mac and the 12 Federal Home Loan Banks (government-sponsored enterprises). The enterprises provide more that $5.5 trillion in funding for U.S. mortgages.
About the author: Fred Chamberlin was a senior loan officer with Guild Mortgage Company in Oak Harbor. He was in the mortgage origination business for over 20 years and in the lending business for over 30 and authors a number of mortgage related blogs.