Submission for OMB Review; Comment Request

FEDERAL HOUSING FINANCE BOARD

[No. 98-N-3]

Submission for OMB Review; Comment Request

AGENCY: Federal Housing Finance Board.

ACTION: Notice.

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SUMMARY: In accordance with the requirements of the Paperwork Reduction

Act of 1995, the Federal Housing Finance Board (Finance Board) hereby

gives notice that it has submitted the information collection entitled

``Monthly Survey of Rates and Terms on Conventional, 1-Family, Nonfarm

Loans,'' commonly known as the ``Monthly Interest Rate Survey'' or

``MIRS'', to the Office of Management and Budget (OMB) for review and

approval of a three-year extension of the OMB control number, which is

due to expire on April 30, 1998.

DATES: Interested persons may submit comments on or before April 2,

1998.

ADDRESSES: Submit comments to the Office of Information and Regulatory

Affairs of OMB, Attention: Desk Officer for the Federal Housing Finance

Board, Washington, D.C. 20503. Address requests for copies of the

information collection and supporting documentation to Elaine L. Baker,

Secretary to the Board, 202/408-2837, Federal Housing Finance Board,

1777 F Street, N.W., Washington, D.C. 20006.

FOR FURTHER INFORMATION CONTACT: Timothy D. Forsberg, Financial

Analyst, Financial Analysis and Reporting Division, Office of Policy,

202/408-2968, Federal Housing Finance Board, 1777 F Street, N.W.,

Washington, D.C. 20006.

SUPPLEMENTARY INFORMATION:

A. Need for and use of Information Collection

The Finance Board's predecessor, the former Federal Home Loan Bank

Board (FHLBB), first provided data concerning a survey of mortgage

interest rates in 1963. No statutory or regulatory provision explicitly

required the FHLBB to conduct the MIRS, although references to the MIRS

did appear in several federal and state statutes. Responsibility for

conducting the MIRS was transferred to the Finance Board upon

dissolution of the FHLBB in 1989. See Financial Institutions Reform,

Recovery, and Enforcement Act of 1989 (FIRREA), Public Law 101-73,

Title IV, section 402(e)(3)-(4), 103 Stat. 183, codified at 12 U.S.C.

1437 note, and Title VII, section 731(f)(1), (f)(2)(B), 103 Stat. 433

(Aug. 9, 1989). In 1993, the Finance Board promulgated a final rule

describing the method by which it conducts the MIRS. See 58 FR 19195

(Apr. 13, 1993), codified at 12 CFR 902.3. Since its inception, the

MIRS has provided the only consistent source of information on mortgage

interest rates and terms and house prices for areas smaller than the

entire country.

Statutory references to the MIRS include the following:

Pursuant to their respective organic statutes, the Federal

National Mortgage Association (also known as Fannie Mae) and the

Federal Home Loan Mortgage

[[Page 10383]]

Corporation (also known as Freddie Mac) use the MIRS results as the

basis for annual adjustments to the maximum dollar limits for their

purchase of conventional mortgages. See 12 U.S.C. 1454(a)(2),

1717(b)(2). The Fannie Mae and Freddie Mac limits were first tied to

the MIRS by the Housing and Community Development Act of 1980. See

Public Law 96-399, Title III, section 313(a)-(b), 94 Stat. 1644-1645

(Oct. 8, 1980). At that time, the nearly identical statutes required

Fannie Mae and Freddie Mac to base the dollar limit adjustments on

``the national average one-family house price in the monthly survey of

all major lenders conducted by the [FHLBB].'' See 12 U.S.C. 1454(a)(2),

1717(b)(2) (1989). When Congress abolished the FHLBB in 1989, it

replaced the reference to the FHLBB in the Fannie Mae and Freddie Mac

statutes with a reference to the Finance Board. See FIRREA, Title VII,

sec. 731(f)(1), (f)(2)(B), 103 Stat. 433.

Also in 1989, Congress required the Chairperson of the

Finance Board to take necessary actions to ensure that indices used to

calculate the interest rate on adjustable-rate mortgages (ARMs) remain

available. See id. Title IV, sec. 402(e)(3)-(4), 103 Stat. 183,

codified at 12 U.S.C. 1437 note. At least one ARM index, known as the

National Average Contract Mortgage Rate for the Purchase of Previously

Occupied Homes by Combined Lenders, is derived from the MIRS data. The

statute permits the Finance Board to substitute an ARM index after

notice and comment only if the new ARM index is based upon data

substantially similar to that of the original ARM index and

substitution of the new ARM index will result in an interest rate

substantially similar to the rate in effect at the time the new ARM

index replaces the existing ARM index. See 12 U.S.C. 1437 note.

Congress indirectly connected the high cost area limits

for mortgages insured by the Federal Housing Administration (FHA) of

the Department of Housing and Urban Development to the MIRS in 1994

when it statutorily linked these FHA insurance limits to the purchase

price limitations for Fannie Mae. See Public Law 103-327, 108 Stat.

2314 (Sept. 28, 1994), codified at 12 U.S.C. 1709(b)(2)(A)(ii).

The Internal Revenue Service uses the MIRS data in

establishing ``safe-harbor'' limitations for mortgages purchased with

the proceeds of mortgage revenue bond issues. See 26 CFR 6a.103A-

2(f)(5).

Statutes in several states and U.S. territories, including

California, Indiana, Michigan, Minnesota, New Jersey, Wisconsin, and

the Virgin Islands, refer to, or rely upon, the MIRS. See, e.g., Cal.

Rev. & Tax 439.2 (Deering 1996) (value of owner-occupied single family

dwellings for tax purposes); Cal. Civ. 1916.7, 1916.8 (mortgage rates);

Ind. Code Ann. 28-1-21.5-1 (Burns 1996) (mortgage instruments); Iowa

Code 534.205 (1995) (real estate loan practices); Mich. Stat. Ann.

23.1125(21) (1996) (enforcement of mortgages); Minn. Stat. 92.06 (1996)

(payments for state land sales); N.J. Rev. Stat. 31:1-1 (1996)

(interest rates); Wis. Stat. 138.056 (1996) (variable loan rates); V.I.

Code Ann. tit. 11, section 951 (1996) (legal rate of interest).

The Finance Board uses the information collection to produce the

MIRS and for general statistical purposes and program evaluation.

Economic policy makers use the MIRS data to determine trends in the

mortgage markets, including interest rates, down payments, terms to

maturity, terms on ARMs, and initial fees and charges on mortgage

loans. Other federal banking agencies use the MIRS results for research

purposes. Information concerning the MIRS is regularly published in the

popular trade press, in Finance Board releases, and in publications of

other federal agencies.

The likely respondents include a sample of 390 savings

associations, mortgage companies, commercial banks, and savings banks.

The information collection requires each respondent to complete FHFB

Form 10-91 on a monthly basis.

The OMB number for the information collection is 3069-0001. The OMB

clearance for the information collection expires on April 30, 1998.

B. Burden Estimate

The Finance Board estimates the total annual average number of

respondents at 390, with twelve responses per respondent. The estimate

for the average hours per response is 1.0 hours. The estimate for the

total annual hour burden is 4,680 hours (390 respondents x 12

responses/respondent x approximately 1.0 hour).

C. Comment Request

In accordance with the requirements of 5 C.F.R. 1320.8(d), the

Finance Board published a request for public comments regarding this

information collection in the Federal Register on December 11, 1997.

See 62 FR 65265 (Dec. 11, 1997). The 60-day comment period closed on

February 9, 1998. The Finance Board received no public comments.

Written comments are requested on: (1) Whether the collection of

information is necessary for the proper performance of Finance Board

functions, including whether the information has practical utility; (2)

the accuracy of the Finance Board's estimates of the burdens of the

collection of information; (3) ways to enhance the quality, utility,

and clarity of the information collected; and (4) ways to minimize the

burden of the collection of information on respondents, including

through the use of automated collection techniques or other forms of

information technology. Comments may be submitted to OMB in writing at

the address listed above.

By the Federal Housing Finance Board.

Dated: February 25, 1998.

William W. Ginsberg,

Managing Director.

[FR Doc. 98-5377 Filed 3-2-98; 8:45 am]

BILLING CODE 6725-01-P