New York Department of Financial Services' Superintendent announced they will designate the Average Prime Offer Rate for 5/1 ARMs as the replacement benchmark lending institutions use for calculating subprime thresholds for adjustable or variable rate loans with an initial rate that is fixed for a minimum of 3 years pursuant Section 6-m of the Banking Law. This is in response to Freddie Mac’s announcement that it would discontinue publication of its weekly Primary Mortgage Market Survey (PMMS) rate for 5/1 ARMs. This guidance is retroactive to November 17, 2022, which is the first day on which Freddie Mac ceased publication of the 5/1 ARM rate.
