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National Average Mortgage Rates as of May 16, 2008
30 Year Fixed Rate	15 Year Fixed Rate	1 Year Adj. Rate
Interest Rate	Total Points	Interest Rate	Total Points	Interest Rate	Total Points
6.37%	0.35	5.83%	0.29	5.74%	0.37
Source: HSH Associates, Financial Publishers http://www.hsh.com/

National Average Mortgage Rates as of May 16, 2008
3/1 Hybrid ARMs	5/1 Hybrid ARMs	7/1 Hybrid ARMs	10/1 Hybrid ARMs
Interest Rate	Total Points	Interest Rate	Total Points	Interest Rate	Total Points	Interest Rate	Total Points
6.22%	0.46	6.16%	0.36	6.78%	0.45	7.44%	0.71
Source: HSH Associates, Financial Publishers http://www.hsh.com/

The rates presented above are an average of the interest rates and "points" generally being offered by lenders across the country as of the date indicated. Specific lenders may quote pricing which is higher or lower than the averages.

In the special vocabulary of mortgage lending, "points" are often used to describe a type of fee that lenders charge. (The full term to describe this fee is "discount points.") Simply put, a point is a unit of measure that means 1 percent of the loan amount. So, if you take out a $100,000 loan, one point equals $1,000. Discount points represent additional money you can pay to the lender at closing. In return, the lender will provide you with a lower interest rate on your loan. Usually, for each point you pay for a 30-year loan, your interest rate is reduced by about 1/8th (or .125) of a percentage point. So, if the current interest rate on a 30-year mortgage is 7.5 percent, paying 1 point means you could get that mortgage for an interest rate of 7.375 percent.

For example, you are shopping for a 30-year mortgage loan. A lender quotes you an interest rate for a 30-year, $50,000 mortgage at 8.5 percent with no discount points. If you like that rate, you can choose not to pay any discount points at closing and pay 8.5 percent interest. If you want to pay less interest, ask the lender to quote you interest rates with your paying 1, 2, or 3 discount points. Usually, the longer you plan to stay in your home, the more sense it makes to pay discount points.

The HomePath logo is a registered service mark of Fannie Mae. Use of this mark on this page is by express permission of Fannie Mae, and does not imply an endorsement of any products or services offered by HSH Associates.

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