Monthly Treasury Average

This loan is NOT a fixed rate mortgage and adjusts monthy, please read carefully to understand the benefits and disadvantages of the MTA Loan Power-Option-ARM.

A mortgage with an interest rate payment that changes periodically over the life of the loan based on changes in a specified index. Historically, home loans tied to the Monthly Treasury Average Index (MTA or 12-MAT) have not exhibited sharp interest rate increases such as those that occurred in the late l980's.

What is the MTA Loan? The Monthly Treasury Average (12-Month Treasury Average Index or 12-MTA) is based on average annual yields on U.S.Treasury Securities adjusted to a constant maturity of one year, as made available by the Federal Reserve. The 12-month average is determined by adding together the annual yields for the most recently available 12 months and dividing it by a 12-month average.

Stability: The 12-MTA Advantages. The 12-MTA Index does not move up or down as rapidly as other market interest rates because the 12-MTA is an average of annual yields on U.S. Treasury Securities over a 12-month period. As a result:

* Higher yields are offset by lower yields on a monthly basis throughout the year

* It creates an index that is far less volatile than other pure-rate indices
* Interest rate increases take longer to affect the 12-MTA than other ARM indices

Why the 12-MTA Declines While Other Rates Rise. Even when other rates rise, the 12-MTA Index usually continues to decline for several more months because the 12-MTA is calculated as a 12-month moving average. As a result, it takes a longer period of time for interest rate increases to affect this calculation as lower values throughout the 12-month period keep index increases in check. That means you can enjoy the stability of your 12-MTA, compared to other interest rate indices that generally rise and fall more rapidly.

The Monthly Treasury Average Mortgage is one of the greatest mortgages for a new home purchase or refinancing mortgages. The 12-MTA allows you the freedom of making mortgage payments of your choice, NEGAM, Interest-Only and the full Index payment base on your rate. For more information on the 12-MTA call today for a free loan comparison to see if the Monthly Treasury Average is right for you.

MTA-Monthly Treasury Average, COSI-Cost Of Savings Index, COFI-Cost Of Funds Index

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