Amston Mortgage Company, Rates Used

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RATES USED

1 Year US Treasury (HISTORY)

The FHA uses the 1 Year U.S. Treasury Index plus a margin (1.5 for the FHA Monthly and 2.1 for the FHA Annual programs) to calculate the interest rate that is used to accrue the interest charged on the money borrowed. The rates, adjustments and caps vary by monthly and annual programs.

10 Year US Treasury (HISTORY)

The FHA requires that the 10 Year T-Bill plus a margin (1.5 for the FHA Monthly and 2.1 for the FHA Annual programs) be used in determining the eligible dollars that a borrower can receive. This is not the amount of interest that is being charged for money borrowed.

CD (HISTORY)

The Fannie Mae program uses the weekly average of the 1 Month secondary market CD plus a margin (3.40) determined by Fannie Mae. The rates are adjusted monthly with a lifetime cap of 12% over the initial interest rate.

LIBOR (HISTORY)

The LIBOR is the index that is used to calculate the interest on all Cash Account programs. the LIBOR (London Inter Bank Offering Rate) is an average of what international banks charge for large-volume loans. This index is used because it responds quickly to market conditions and is calculated for a variety of loan adjustments. The LIBOR has also become a common gauge as a standard financial index used by U.S. banks to calculate adjustable rate mortgages. The rates are calculated by using the index plus a margin (5%). The rates are adjusted semi-annually with a cap of 6% over the initial interest rate.

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updated October 2, 2006