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ARM Indexes: MTA (12-MAT)

Moving Average of the Monthly values of the One-year
Treasury Constant Maturity, 2010s (explanation)

Source: Federal Reserve (raw data)

 

Index Month Index Value
January 2010 0.46333
February 2010 0.44083
March 2010 0.42083
April 2010 0.41250
May 2010 0.40167
June 2010 0.38583
July 2010 0.37000
August 2010 0.35333
September 2010 0.34167
October 2010 0.33000
November 2010 0.32500
December 2010 0.31833

Index Month Index Value
January 2011 0.31167
February 2011 0.30667
March 2011 0.29500
April 2011 0.27833
May 2011 0.26333
June 2011 0.25167
July 2011 0.24333
August 2011 0.23083
September 2011 0.21750
October 2011 0.20750
November 2011 0.19583
December 2011 0.18167

Index Month Index Value
January 2012 0.16917
February 2012 0.15833
March 2012 0.15250
April 2012 0.14667
May 2012 0.14667
June 2012 0.14750
July 2012 0.14750
August 2012 0.15333
September 2012 0.16000
October 2012 0.16583
November 2012 0.17167
December 2012 0.17500

Index Month Index Value
January 2013 0.17750
February 2013 0.17750
March 2013 0.17417
April 2013 0.16917
May 2013 0.16333
June 2013 0.15917
July 2013 0.15333
August 2013 0.14917
September 2013 0.14417
October 2013 0.13917
November 2013 0.13417
December 2013 0.13167

Index Month Index Value
January 2014 0.12917
February 2014 0.12583
March 2014 0.12417
April 2014 0.12333
May 2014 0.12167
June 2014 0.11833
July 2014 0.11750
August 2014 0.11583
September 2014 0.11500
October 2014 0.11333

For other decades, click here.

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, but later by Wachovia and Wells Fargo Bank).

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

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