Mortgage Rates in April 2009 Declined

The data is based on the Monthly Interest Rate Survey (MIRS) of major lenders regarding the terms and conditions on all conventional, single-family, fully amortized, purchase-money loans that were closed during the last five working days of the month. The data excludes FHA-insured and Vaguaranteed mortgages, refinancing loans, and balloon loans.

According to the FHFA survey, the average interest rate on conventional 30-year, fixed-rate, mortgage loans of $417,000 or less dropped to 4.87 percent in April, representing a decrease of 18 basis points from previous month.

The average interest rate on 15-year, fixed-rate loans of $417,000 or less dropped to 4.75 percent in April, representing a decrease of 3 basis points. These figures reflect the rates on loans closed during April 24-30. Since the interest rate is determined 30 to 45 days before the loan is closed, the reported rates reflect market conditions that were prevailing in mid- to late March.

The contract rate on the composite of all mortgage loans (fixed- and adjustable-rate) dropped to 4.88 percent in April, representing a decrease of 17 basis points from 5.05 percent in March. The effective interest rate, which takes into account the amortization of initial fees and charges, dropped to 4.96 percent, down 18 basis points from 5.14 percent in March.

Initial fees and charges stood at 0.57 percent of the loan balance, forty-five percent of the purchase-money mortgage loans that were originated in April were "no-point" mortgages, and the average loan-to-value ratio was 75.1 percent, up from 74.7 percent in March. The average loan amount increased by $7,100 to $217,000 in April.