Borrowers eschew ARMs

WASHINGTON – May 28, 2009 – Freddie Mac’s first-quarter product transition report shows that more than 99 percent of prime borrowers with conforming ARMs refinanced into a conforming fixed-rate mortgage, and nearly 100 percent of refinancers with fixed-rate loans stayed with an FRM.

Freddie Mac chief economist Frank Nothaft notes, “The lowest fixed mortgage rates (we’ve seen) in 50 years are attractive by themselves, and when we look at average ARM interest rates that are nearly the same as the fixed rates, it is easy to see why borrowers are making the choice for fixed-rate mortgages.”

Source: National Mortgage News, Bonnie Sinnock (05/29/2009)

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