HOUSING FINANCE

Mortgage Interest Rates

Interest rates on fixed-rate mortgages increased approximately 20 basis points from the previous quarter and decreased between 4 and 14 basis points from a year ago. The contract mortgage interest rate for 30-year, fixed rate, conventional mortgages reported by Freddie Mac was 6.97 percent in the first quarter of 2002, 19 basis points higher than the previous quarter but 4 basis points lower than the first quarter of 2001. Adjustable-rate mortgages in the first quarter were going for 5.08 percent, 16 basis points below the previous quarter and 140 basis points below first quarter of 2001. Fixed-rate, 15-year mortgages, at 6.46 percent, were up 20 basis points during the first quarter and down 14 basis points below the same quarter in 2001.

FHA 1-4 Family Mortgage Insurance*

Applications for FHA mortgage insurance on 1–4 family homes were received for 350,400 (not seasonally adjusted) properties in the first quarter of 2002, down 21 percent from the previous quarter and down 22 percent from the first quarter of 2001. Total endorsements or insurance policies issued totaled 355,600, up 3 percent from the fourth quarter of 2001. Purchase endorsements, at 247,400, were up 11 percent from the fourth quarter of 2001 and were up 32 percent from the first quarter of 2001. Endorsements for refinancings decreased to 108,200, a 12-percent decline from the previous quarter but up 105 percent from the first quarter a year ago.

PMI and VA Activity*

Private mortgage insurers issued 543,900 policies or certificates of insurance on conventional mortgage loans during the first quarter of 2002, down 7 percent from the fourth quarter of 2001 but up 52 percent from the first quarter of 2001; these numbers are not seasonally adjusted. The Department of Veterans Affairs (VA) reported the issuance of mortgage loan guaranties on 94,200 single-family properties in the first quarter of 2002, up 17 percent from the previous quarter and up 90 percent from the first quarter of 2001.

Delinquencies and Foreclosures

Total delinquencies were at 4.65 percent at the end of 2001’s fourth quarter, down 5 percent from the third quarter of 2001 but up 3 percent from the fourth quarter of 2000. Ninety-day delinquencies remained at 0.73 percent, unchanged from the third quarter of 2001 but up 20 percent from the fourth quarter a year ago. During the fourth quarter of 2001, 0.36 percent of loans entered foreclosure, down 5 percent from the third quarter of 2001 but up 20 percent from the fourth quarter of the previous year.