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ARM Indexes: MTA (12-MAT)

Moving Average of the Monthly values of the One-year
Treasury Constant Maturity, 2000s (explanation)

Source: Federal Reserve (raw data)

Month Value
Jan-2000 5.2117
Feb-2000 5.3383
Mar-2000 5.4583
Apr-2000 5.5800
May-2000 5.7033
Jun-2000 5.7925
Jul-2000 5.8800
Aug-2000 5.9617
Sep-2000 6.0350
Oct-2000 6.0833
Nov-2000 6.1283
Dec-2000 6.1083
Month Value
Jan-2001 5.9992
Feb-2001 5.8708
Mar-2001 5.7108
Apr-2001 5.5300
May-2001 5.3175
Jun-2001 5.1017
Jul-2001 4.8967
Aug-2001 4.6708
Sep-2001 4.3950
Oct-2001 4.0883
Nov-2001 3.7625
Dec-2001 3.4808
Month Value
Jan-2002 3.2600
Feb-2002 3.0558
Mar-2002 2.9117
Apr-2002 2.7867
May-2002 2.6675
Jun-2002 2.5525
Jul-2002 2.4142
Aug-2002 2.2717
Sep-2002 2.1800
Oct-2002 2.1233
Nov-2002 2.0658
Dec-2002 2.0017
Month Value
Jan-2003 1.9350
Feb-2003 1.8575
Mar-2003 1.7467
Apr-2003 1.6458
May-2003 1.5483
Jun-2003 1.4492
Jul-2003 1.3792
Aug-2003 1.3417
Sep-2003 1.3017
Oct-2003 1.2683
Nov-2003 1.2558
Dec-2003 1.2442
Month Value
Jan-2004 1.2342
Feb-2004 1.2292
Mar-2004 1.2250
Apr-2004 1.2383
May-2004 1.2883
Jun-2004 1.3808
Jul-2004 1.4625
Aug-2004 1.5217
Sep-2004 1.5950
Oct-2004 1.6767
Nov-2004 1.7733
Dec-2004 1.8867
Month Value
Jan-2005 2.0217
Feb-2005 2.1708
Mar-2005 2.3467
Apr-2005 2.5042
May-2005 2.6333
Jun-2005 2.7367
Jul-2005 2.8650
Aug-2005 3.0192
Sep-2005 3.1633
Oct-2005 3.3258
Nov-2005 3.4783
Dec-2005 3.6183
Month Value
Jan-2006 3.7508
Feb-2006 3.8883
Mar-2006 4.0108
Apr-2006 4.1425
May-2006 4.2817
Jun-2006 4.4317
Jul-2006 4.5633
Aug-2006 4.6642
Sep-2006 4.7575
Oct-2006 4.8267
Nov-2006 4.8833
Dec-2006 4.9325
Month Value
Jan-2007 4.9833
Feb-2007 5.0142
Mar-2007 5.0267
Apr-2007 5.0292
May-2007 5.0217
Jun-2007 5.0050
Jul-2007 4.9833
Aug-2007 4.9325
Sep-2007 4.8633
Oct-2007 4.7875
Nov-2007 4.6617
Dec-2007 4.5217
Month Value
Jan-2008 4.3258
Feb-2008 4.0758
Mar-2008 3.7942
Apr-2008 3.5283
May-2008 3.2908
Jun-2008 3.0792
Jul-2008 2.85583
Aug-2008 2.66500
Sep-2008 2.47917
Oct-2008 2.25583
Nov-2008 2.05333
Dec-2008 1.82250
Month Value
Jan-2009 1.63333
Feb-2009 1.51417
Mar-2009 1.43917
Apr-2009 1.34000
May-2009 1.21000
Jun-2009 1.05083
Jul-2009 0.90083
Aug-2009 0.75750
Sep-2009 0.63167
Oct-2009 0.54417
Nov-2009 0.48083
Dec-2009 0.47083

Explanation of this index

MTA (aka 12-MAT) is an index used to govern changes in certain Adjustable Rate Mortgages (ARMs), notably Option and FlexPay-style ARMs which feature monthly adjustment periods. MTA stands for "Moving Treasury Average".

The MTA, sometimes called MAT or 12-MAT, is a "derived" ARM index. It is produced by adding together other published index values and dividing the sum by the number of entries to produce a final single value.

To produce the monthly value for the MAT, a lender will add the last twelve monthly values of the one-year US Treasury Constant Maturity (not Treasury "bill") and divide the total by 12 (entries). The result is the new index value.

To that value, the lender will add a markup, called a "margin", and the sum of the two becomes your loan's new interest rate. For Option and FlexPay ARMs, the margin is typically 250 basis points (2.5%). Different lenders may use larger or smaller margins.

Since a "moving average" series could use any number of Treasury values, some lenders identify the MTA as 12-MAT (their own shorthand for 12-month moving average of the one-year Treasury).

Because it is a moving average, the MTA isn't as volatile as the index it is derived from (see this chart for a graphic demonstration). This can work to your advantage when interest rates are rising, but when rates are falling, the moving average will prevent your mortgage rate from falling rapidly.

Indexes comparable to the MTA include the 11th District Cost of Funds (COFI) and COSI, the cost-of-savings index produced by Golden West Financial (World Savings).

The latest value of this index is posted in the Current Indexes table.

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