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Copyright © 2012 by the first tuesday Journal Online - firsttuesdayjournal.com;
P.O. Box 5707, Riverside, CA 92517
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Current market rates
By ft Editorial Staff • May 17th, 2012 • Category: Charts
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The 91-Day Treasury Bill rose very slightly in the week ending on May 18, 2012, continuing the pattern of week-to-week fluctuations that has taken place since March. The 30-year and 15-year mortgage rates and 10-Year Treasury Note rate also dropped, all setting new record lows for mortgage rates in this recession.
The 3-Month and 6-Month Treasury Bill rates and The London Inter-Bank Offered Rate (LIBOR) rates for April 2012 remained level with the preceding month. Other rates used to adjust adjustable-rate mortgages (ARMs) did not fare so well. The Treasury Securities Yield dropped slightly after increasing for six consecutive months, and the12-Month Treasury Average and Cost of Funds rates continued to drop in April as they have for most of the past year. loading...
91-Day Treasury Bill – Average Auction Rate |
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 Chart updated 5/17/12 |
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Current
5/16/12
0.1%
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Month Ago
4/19/12
0.08%
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Year Ago
5/19/11
0.03%
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| This rate determines the minimum interest rate the seller must impute in a delayed §1031 transaction and report when not receiving interest on §1031 monies held by a facilitator/accommodator. This rate also sets the amount of the ordinary income the facilitator/accommodator must report. [For more on the use of §1031 monies, see the August 2008 article, Interest imputed on §1031 monies delivered to facilitators.] | ||
3-Month Treasury Bill |
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 Chart updated 5/10/12 |
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Month
4/2012
0.08%
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Month Ago
3/2012
0.08%
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Year Ago
4/2011
0.06%
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| The 3-Month Treasury Bill is the rate managed by the Federal Reserve through the Fed Funds Rate as the base price of borrowing money in the short-term. It is used in determining the yield spread, which predicts the likelihood of a recession one year forward. The posted rate is the monthly average for the listed month. Rates are released with a 1-2 month reporting delay. [For more information on the yield spread, see the March 2010 first tuesday Article, Using the yield spread to forecast recessions.] | ||
10-Year T-Notes – Average Market Yield |
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 Chart updated 5/17/12 |
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Current
5/15/12
1.76%
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Month ago
4/18/12
2%
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Year ago
5/17/11
3.12%
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This rate is a leading indicator of the direction of future Federal Home Loan Mortgage Corporation (Freddie Mac) rates, which historically run closer to 4% during a stable money market. The rate is comprised of the level of worldwide demand for the dollar and anticipated future domestic inflation.
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Average 30-Year Conventional Commitment Rate |
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 Chart updated 5/17/12 |
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Current
5/17/12
3.74%
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Month ago
4/19/12
3.86%
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Year ago
5/19/11
4.55%
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The average 30-year commitment rate is the rate at which a lender commits to lend mortgage money in the United States-West as reported by Freddie Mac. The western region includes CA, AZ, NV, OR, WA, UT, ID, MT, HI, AK, and GU. More information is available on Freddie Mac’s Primary Mortgage Market Survey report.
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 Chart updated 5/17/12 |
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Current
5/17/12
2.98%
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Month ago
4/19/12
3.11%
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Year ago
5/19/11
3.72%
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The average 15-year commitment rate is the rate at which a lender commits to lend mortgage money in the United States-West as reported by Freddie Mac. More information is available on Freddie Mac’s Primary Mortgage Market Survey report.
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 Chart updated 5/10/12 |
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Month of
4/2012
0.14%
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Month Ago
3/2012
0.14%
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Year Ago
4/2011
0.12%
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The adjustable rate mortgage (ARM) interest rate equals the 6-month T-Bill rate (at time of adjustment or an average of several prior rates), plus the lender’s profit margin. The posted rate is the monthly average for the listed month. Rates are released with a 1-2 month reporting delay.
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Treasury Securities Average Yield — 1-Year Constant Maturity |
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 Chart updated 5/3/12 |
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Month of
4/2012
0.18%
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Month Ago
3/2012
0.19%
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Year Ago
4/2011
0.25%
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This index is one of several indexes used by lenders as stated in their ARM note to periodically adjust the note’s interest rate. The ARM interest rate equals T-Bill yield, plus the lender’s profit margin. The index is an average of T-Bill yields with maturities adjusted to one year.
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12-Month Treasury Average |
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 Chart updated 5/3/12 |
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Month of
4/2012
0.15%
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Month Ago
3/2012
0.15%
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Year Ago
4/2011
0.28%
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This index is one of several indexes used by lenders as stated in their ARM note to periodically adjust the note’s interest rate. This figure is an average of the one-year T-Bill rates for the past 12 months.The ARM interest rate equals the 12-Month Treasury Average yield plus the lender’s profit margin. There is a one-two month lag in data reporting for the 12-Month Treasury Average.
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Cost of Funds Index (11th FHLBB District) |
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 Chart updated 5/3/12 |
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5/2/12
1.16%
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4/2/12
1.21%
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5/2/11
1.47%
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This index is one of several indexes used by lenders as stated in their ARM note to periodically adjust the note’s interest rate. The ARM interest rate equals Cost-of-Funds, plus the lender’s profit margin. Current index reflects the cost of funds two months’ prior in the United States-West. More information is available on the Federal Home Loan Bank of San Francisco Cost of Fund’s Index page.
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 Chart updated 5/3/12 |
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Average 15-Year
5/3/2012
3.04%
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Average 30-Year
5/3/2012
3.79%
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12-Month Treasury Avg.
4/2012
0.15%
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The average 15- and 30-year conventional commitment rates are the rates at which a lender commits to lend mortgage money in the United States-West for the duration of the life of each respective loan as reported by Freddie Mac. More information is available on Freddie Mac’s Primary Mortgage Market Survey report. The 12-Month Treasury Average is an average of the one-year T-Bill rates for the past 12 months.The ARM interest rate equals the 12-Month Treasury Average yield plus the lender’s profit margin. The 12-Month Average is reported with a one-two month delay.
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London Inter-Bank Offered Rate |
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 Chart updated 5/3/12 |
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1 Month
0.24%
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6 Month
0.73%
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1 Year
1.05%
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This index is one of several indexes used by lenders as stated in their ARM note to periodically adjust the note’s interest rate. The ARM interest rate equals the LIBOR rate plus the lender’s profit margin. The rate is set by the banks in London, England.
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Prime Rate |
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 Chart updated 5/3/12 |
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Month of
4/2012
3.25%
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Month Ago
3/2012
3.25%
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Year Ago
4/2011
3.25%
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This index is one of several indexes used by lenders as stated in their ARM note to periodically adjust the note’s interest rate. The Prime Rate is used by banks to price short-term business loans and set ARMs tied to the Prime Rate. Historically the rate is 3% over the Federal Funds Target Rate.
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Discount Rate – Federal Reserve Bank of San Francisco |
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 Chart updated 5/3/12 |
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Month of
4/2012
0.75%
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Month Ago
3/2012
0.75%
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Year Ago
4/2011
0.75%
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Usury law limits the annual interest yield on nonexempt loans to 10%, or the discount rate plus 5%, whichever is greater. The discount rate is charged on loans made by the the Federal Reserve Bank to its members. More information is available on the Federal Reserve Bank of San Francisco’s Discount Rate page.
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Applicable Federal Rates |
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 Chart updated 5/3/12 |
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Short (to 3 years)
May 2012
0.27%
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Medium (3 to 9 years)
May 2012
1.3%
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Long (9+ years)
May 2012
3.21%
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These rates determine minimum interest yield reportable on carryback financing. The AFR category is determined by the carryback due date. *Rates are for monthly payments. More information on AFRs on other payment periods can be found on the Internal Revenue Service Applicable Federal Rates page.
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| San Francisco | Los Angeles | ||||||||||
| February 2011 |
707.027
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March 2011 |
686.144
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| February 2012 |
728.234
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March 2012 |
700.028
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| Annual Change |
3%
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Annual Change | 2% | ||||||||
The periodic percentage change in the consumer price index (CPI) is a measure of domestic inflation, and is used to measure price movements among goods and services associated with the consumer’s cost of living. The CPI is one of the factors used to adjust monthly rents in non-residential leases. More information about the CPI is available on the Bureau of Labor Statistics New Releases page. [For more information on the CPI, see the November 2009 first tuesday article, Calculating Owner-Occupied Housing in CPI. first tuesday students can also see Chapter 44 of the textbook Property Management, "Rent Increases and the CPI," available on the Forms-on-CD 4.2 and Online Library. (Not a first tuesday student? Click here and enroll in any course for one-year's access to all books and materials published by first tuesday.)] |
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Rate Analysis for Private Lender Section 32 Reg-Z LoansLast updated 5/3/12 |
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Month* |
6-Month |
1-Year |
2-Year |
3-Year |
5-Year |
7-Year |
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April 2012 |
0.14% |
0.18% |
0.26% |
0.39% |
0.84% |
1.36% |
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On junior trust deed loans, a margin of 5 – 8% points is added to the Index Figure (Cost-of-Funds Rate) for the maturity date of a Treasury bill equal in length to the payoff date of the loan to set the Section 32 threshold for term limitations. With this in mind, if the percentage of the total loan amount represented by points and fees is greater than the applicable Federal Securities Rate plus ten percentage points, additional disclosures, limitations and prohibitions are triggered by Regulation Z (Reg-Z) Section 32. [For more information, please reference the June 2008 first tuesday articles, Regulation Z Controlled Lending and Brokering Cal-32 High-Cost Loans. first tuesday students can also access first tuesday Form 223-1, Points and Fees Test, and first tuesday Form 223-1, Supplemental Truth-in-Lending Section 32 Disclosure, available on the Forms-on-CD 4.2 and Online Library. (Not a first tuesday student? Click here and enroll in any course for one-year's access to all books and materials published by first tuesday.)]
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*Selection of rate:
The rate for each month is set as the rate of the Treasury Security for each maturity date (term) on the 15th of the prior month as provided by the Treasury’s statistical release H. 15.
*Rate information gathered from:
The Federal Reserve Board
Federal Reserve Bank of San Francisco
Federal Reserve Bank of St. Louis
The Bureau of Labor Statistics
Federal Home Loan Bank of San Francisco
Federal Home Loan Mortgage Corporation (Freddie Mac)
Federal National Mortgage Association (Fannie Mae)
U.S. Department of Labor
U.S. Department of the Treasury
Internal Revenue Service
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Copyright © 2012 by the first tuesday Journal Online - firsttuesdayjournal.com;
P.O. Box 5707, Riverside, CA 92517
Readers are encouraged to reproduce and/or distribute this article.
Copyright © 2012 by first tuesday Realty Publications, Inc. Readers are encouraged to reprint or distribute this information with credit given to the first tuesday Journal Online — P.O. Box 5707, Riverside, CA 92517.
ft Editorial Staff is the writing staff comprised of legal editor Fred Crane and writer-editors Connor P. Wallmark, Giang Hoang-Burdette, Bradley Markano, Jeffery Marino, Mary Balash, Carrie B. Reyes and Sarah Cantino.
Email this author | All posts by ft Editorial Staff
Hi ,
This is a very helpful analysis. Keep it up monthly for those that are serious about following ARMs.
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Thank you for all of the great info and data each month!
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Really appreciate your continued current info on all types of market rates, sales, home prices, etc. Very useful for those of us working this business every single day.
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You guys are great and I look to you for unadulterated truth.
No fear of me straying with great articles like this.
Next time I renew u can bet its with your program.
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helpful Synopsis
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Still more good news”
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Concise information, clearly explained. Good stuff!
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