This LIBOR series is produced by HSH as a replacement for the FNMA LIBOR which was discontinued in June 2007. HSH does not calculate or compute this value, but rather simply follows the methodology used by Fannie Mae prior to the discontinuation. HSH maintains this series as a convenience.
Note: On June 30, 2023, the originating source of the data that becomes HSH LIBOR series will no longer be published. Therefore, the final published value of all terms of HSH LIBOR will be for June 2023, and the series will be discontinued at that time.
Newly-originated ARMs eligible for purchase by Fannie Mae or Freddie Mac will use the 30-day Average Secured Overnight Financing Rate (30-day SOFR).
Existing mortgages that are serviced by Fannie Mae or Freddie Mac will switch to a LIBOR-like CME Term SOFR. Details on this index can be seen here.
Certain 1 month, 3 month and 6 month legacy mortgages may use a temporary "synthetic LIBOR", as directed by the Financial Conduct Authority (UK), the regulator that oversees LIBOR. Synthetic LIBOR will be created and published until September 30, 2024. This is for outstanding loans only; use for new instruments is prohibited.
ARMs and securities held by individual lenders or investors might also now use an index called "Refinitiv USD IBOR Cash Fallbacks" as a index to govern interest rate changes. You can learn about these here.
If you have an ARM subject to the change in index, we recommend that you carefully read any correspondence from your lender to make certain that you are following the correct index for your ARM.
The Fannie Mae LIBOR rate was (and the HSH LIBOR rate is) are determined from information that is available as of 11:00 a.m. (London Time) on the second to last business day of each month. We make these rates available by the last business day of each month. You can download a spreadsheet showing a 12-year comparison of the HSH LIBOR versus the FNMA LIBOR.
LIBOR is an abbreviation for "London Interbank Offered Rate," and is the interest rate offered by a specific group of London banks for U.S. dollar deposits of a stated maturity. LIBOR is used as a base index for setting rates of some adjustable rate financial instruments, including Adjustable Rate Mortgages (ARMs).