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PACE OF REFINANCING REMAINS STRONG IN SEPTEMBER AS INTEREST RATES REMAIN LOW; CONSUMERS' APPETITE FOR 30-YEAR, FIXED-RATE MORTGAGES RISES

 WASHINGTON, Oct. 26 /PRNewswire/ -- Mortgage refinancing continued at a strong pace in September as interest rates remained near their lowest levels in a generation, the Federal National Mortgage Association (Fannie Mae) (NYSE: FNM) reported today. Fannie Mae's Mortgage Market Update also showed that consumers' preference for 30-year, fixed-rate loans increased noticeably in September.
 Refinancing
 According to the Mortgage Market Update, the level of refinancing remained unchanged in September from August, at 61 percent of the company's business.


A quarterly comparison indicates that refinancing in the third quarter represented 62 percent of Fannie Mae's mortgage activity, compared with 65 percent in the second quarter of 1993, but substantially higher than the 44 percent in the third quarter of 1992.
 Donna Callejon, Fannie Mae's senior vice president for single-family marketing, said: "The dramatic difference in refinancing activity between the third quarters of 1992 and 1993 shows what a difference a year can make, which is why we are particularly happy that we have invested in the mortgage processing technology that will help accommodate the $1.1 trillion in mortgage originations expected in the market this year."
 30-Year Mortgages
 Fannie Mae's Mortgage Market Update shows 57.3 percent of the current production mortgages the company purchased or securitized in September were 30-year, fixed-rate home loans, compared to 54.7 percent of the company's
mortgage business in August. This is the largest increase in 30-year, fixed-rate home loan activity this year.
 20- and 10-Year Mortgages
 According to Fannie Mae information, 20-year, fixed-rate loans have become increasingly popular among borrowers this year. Fannie Mae's business volume for the 20-year loan was more than $5 billion through the third quarter of this year, 28 percent higher than during the same period of 1992. In addition, the popularity of 20-year mortgage loans rose again in September, accounting for 3.1 percent of Fannie Mae's business volume, up from 2.8 percent in August. About two-thirds of Fannie Mae's active lenders have sold or securitized 20-year mortgages through the company to date this year.
 Similarly, more consumers are choosing 10-year mortgages this year, Fannie Mae reported. Through the third quarter of 1993, Fannie Mae has purchased or securitized nearly $2.5 billion in 10-year loans, a 71 percent increase over the volume recorded during the first three quarters of 1992. More than 60 percent of all active Fannie Mae lenders have sold or securitized 10-year loans through the company in the first three quarters of this year.
 Callejon noted that the increase in 20- and 10-year loan volumes were significant although small compared to Fannie Mae's total mortgage business
this year. "The intermediate-term mortgages taken together, including the 15-year loan, accounted for nearly 30 percent of Fannie Mae's business in September, but the 10- and 20-year loans provide families with additional flexibility to choose which mortgage term best suits their budgets, " she said.
 Fannie Mae is a congressionally chartered, shareholder-owned company, and is the nation's largest source of funds for home mortgages.
 Mortgage Interest Rates
 30-yr 15-yr 7-yr 1-yr
 FRM FRM Balloon ARM
 Jan 92 8.32 7.88 7.57 6.07
 Feb 8.60 8.18 7.86 6.40
 Mar 8.83 8.45 8.28 6.86
 Apr 8.68 8.26 8.17 6.73
 May 8.55 8.10 8.01 6.71
 Jun 8.39 7.89 7.81 6.62
 Jul 7.95 7.40 7.15 6.02
 Aug 7.81 7.27 6.90 5.90
 Sep 7.72 7.12 6.67 5.62
 Oct 7.97 7.41 6.95 5.91
 Nov 8.24 7.74 7.37 6.38
 Dec 8.07 7.61 7.28 6.47
 Jan 93 7.84 7.32 6.93 6.26
 Feb 7.50 6.94 6.52 6.09
 Mar 7.35 6.83 6.38 5.27
 Apr 7.29 6.76 6.31 5.15
 May 7.36 6.81 6.35 5.05
 Jun 7.26 6.74 6.32 5.17
 Jul 7.06 6.56 6.16 5.09
 Aug 6.90 6.41 6.04 5.13
 Sep 6.74 6.27 5.88 4.90
 Note: Rates Based on Fannie Mae 60-Day Required Net Yield
 p -- preliminary
 Product Distribution of Fannie Mae Business(A)
 30-yr 20-yr 15-yr 7-yr
 FRM FRM FRM FRM(B) ARMs Other
 Jan 91 65.0 pct 0.7 pct 11.5 pct 12.1 pct 10.0 pct 0.8 pct
 Feb 66.7 0.6 12.2 13.7 6.0 0.8
 Mar 65.9 0.7 15.6 12.8 4.1 0.9
 Apr 65.3 0.8 18.2 11.0 3.8 0.9
 May 64.8 1.0 20.3 10.2 3.1 0.7
 Jun 64.2 1.1 21.3 9.2 3.5 0.7
 Jul 66.2 1.1 18.3 9.1 4.5 0.9
 Aug 65.2 1.1 17.4 10.0 5.4 0.9
 Sep 63.7 1.2 16.8 10.7 6.7 0.9
 Oct 65.8 1.2 15.4 9.6 7.1 0.8
 Nov 64.9 1.6 19.4 8.1 5.3 0.8
 Dec 62.0 2.0 24.1 7.4 3.9 0.7
 1991ytd 64.8 1.2 18.3 9.9 5.0 0.8
 Jan92 59.2 2.4 26.9 6.5 4.5 0.4
 Feb 56.2 2.7 29.4 7.3 4.1 0.3
 Mar 52.8 3.0 33.1 7.0 3.9 0.3
 Apr 48.6 3.0 35.4 7.7 5.2 0.2
 May 46.3 2.8 35.1 8.0 7.5 0.2
 Jun 50.7 2.4 30.8 6.7 9.2 0.2
 Jul 55.8 2.1 26.9 6.1 8.7 0.3
 Aug 59.9 1.8 24.2 6.3 7.5 0.2
 Sep 60.6 1.6 25.0 6.4 6.1 0.2
 Oct 54.8 2.0 31.3 6.4 5.3 0.2
 Nov 51.2 2.1 35.3 6.3 4.9 0.2
 Dec 50.4 2.1 36.4 6.1 4.8 0.2
 1992ytd 52.7 2.4 31.9 6.7 6.1 0.2
 Jan 93 54.2 2.3 30.3 6.5 6.4 0.2
 Feb 53.3 1.8 31.3 6.6 6.7 0.2
 Mar 55.0 1.9 31.0 6.2 5.6 0.3
 Apr 57.4 2.0 29.6 5.9 4.8 0.3
 May 54.5 2.5 33.3 6.4 3.0 0.2
 Jun 52.0 2.8 36.6 6.2 2.2 0.2
 Jul 53.4 2.8 35.0 6.0 2.6 0.1
 Aug (r) 54.7 2.8 33.1 6.3 3.0 0.1
 Sep (p) 57.3 3.1 29.8 6.1 3.5 0.2
 (A) Based on current production (i.e. does not include seasoned product).
 (B) Includes Balloons and Two-Steps.
 r -- revised
 p -- preliminary
 -0- 10/26/93
 /CONTACT: Tom Marder of Fannie Mae, 202-752-7608/
 (FNM)


CO: Federal National Mortgage Association ST: District of Columbia IN: FIN SU: ECO

DC-KD -- DC015 -- 6847 10/26/93 14:03 EDT
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Date:Oct 26, 1993
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