MBS RECAP: Tight Range All Day

Hot news from AZ Home Help:

Posted To: MBS Commentary

MBSonMND : MBS RECAP Open MBSonMND Dashboard FNMA 3.5 94-15 : -0-01 FNMA 4.0 98-19 : +0-02 FNMA 4.5 101-29 : +0-02 FNMA 5.0 104-23 : +0-03 GNMA 3.5 95-08 : -0-02 GNMA 4.0 100-01 : +0-01 GNMA 4.5 103-06 : +0-01 GNMA 5.0 106-05 : +0-03 FHLMC 3.5 94-10 : -0-01 FHLMC 4.0 98-14 : +0-02 FHLMC 4.5 101-26 : +0-03 FHLMC 5.0 104-19 : +0-02 Pricing as of 4:02 PM EST Afternoon Market Updates A recap of MBS Market Updates provided by MND Analysts and streamed live to the MBSonMND Dashboard . 3:38PM : Loan Pricing Update: 2/28/2011 Among the five major lenders, C30 loan improved on average 11.5bps today. 25bp+ gains were seen on the note rates at or below 4.75%. The 4.875 to 4.75% permanent buydown cost are is still viewed as unattractive in most scenarios. 3:32PM : Right Back To Prevailing Levels Of the...(read more)

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Fence-Sitting Homebuyers Face FHA Fee Hike Deadline

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Posted To: MND NewsWire

Both applications for FHA-guaranteed mortgages and FHA endorsements were lower in January than in the previous month or in January 2010. Reduced loan demand was reflected across all subsets, purchases, refinances and mortgages for first-time buyers. Applications for FHA mortgages totaled 103,991 in January compared to 112,500 in December and 126,043 a year earlier. The year-over-year figure reflects a drop of 17.5 percent. There were 55,417 applications for mortgages to purchase homes and 41,178 to refinance. This was a 3.4 percent decrease in purchase applications since December and a 21.6 percent change from January 2010. Applications to refinance were down 12.1 percent quarter-to-quarter and 16.9 percent over the longer period. FHA endorsed 119,521 mortgages in January compared to 133,603...(read more)

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MBS MID-DAY: Stocks and Bonds Rally

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Posted To: MBS Commentary

MBSonMND : MBS MID-DAY Open MBSonMND Dashboard FNMA 3.5 94-14 : +0-09 FNMA 4.0 98-15 : +0-05 FNMA 4.5 101-24 : +0-02 FNMA 5.0 104-17 : +0-01 GNMA 3.5 95-08 : +0-08 GNMA 4.0 99-30 : +0-04 GNMA 4.5 103-02 : +0-01 GNMA 5.0 105-32 : +0-01 FHLMC 3.5 94-08 : +0-06 FHLMC 4.0 98-10 : +0-06 FHLMC 4.5 101-21 : +0-02 FHLMC 5.0 104-15 : +0-01 Pricing as of 11:02 AM EST Morning Market Updates A recap of MBS Market Updates provided by MND Analysts and streamed live to the MBSonMND Dashboard . 11:01AM : Sideways Slide Gives Way To MBS Gains. Reprices Possible For lenders who are already out with rate sheets today, reprices for the better are a possibility on recent MBS gains to 101-24 in 4.5's. But in most cases, it's still a bit early for that, and some lenders may need further gains before repricing though...(read more)

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MBS RECAP: Going Out at Best Levels of Week

Hot news from AZ Home Help:

Posted To: MBS Commentary

MBSonMND : MBS RECAP Open MBSonMND Dashboard FNMA 3.5 94-12 : +0-07 FNMA 4.0 98-15 : +0-06 FNMA 4.5 101-25 : +0-04 FNMA 5.0 104-19 : +0-04 GNMA 3.5 95-06 : +0-07 GNMA 4.0 99-29 : +0-03 GNMA 4.5 103-02 : +0-02 GNMA 5.0 106-00 : +0-02 FHLMC 3.5 94-06 : +0-04 FHLMC 4.0 98-10 : +0-06 FHLMC 4.5 101-21 : +0-03 FHLMC 5.0 104-16 : +0-03 Pricing as of 4:01 PM EST Afternoon Market Updates A recap of MBS Market Updates provided by MND Analysts and streamed live to the MBSonMND Dashboard . 3:50PM : Looking Ahead To Next Week. It's NFP Time Again! Next week kicks off Monday with Personal Incomes and Outlays at 830am. There's also Fed-Speak from Dudley and Rosengren 830am and 845am respectively. Chicago PMI comes in at 945am, followed by Pending Home sales at 10am. It's also the 28th, and thus the last day...(read more)

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MBS Directional Update: Compelling Cases Presented

Hot news from AZ Home Help:

Posted To: MBS Commentary

On Tuesday we issued a directional MBS alert because the bond market seemed to be in the midst of shift in its underlying technical bias, from bearish to bullish. We cited several different motivations for the recent turn around in benchmark Treasury yields, production MBS coupon prices, and mortgage rates, but the headline grabbing explanation for the move was the actual headlines themselves. We explained it to consumers as so.... "Conflict in Libya and the potential for a spill over into other oil producing countries has energy traders nervous about shrinking oil inventories. The chance for a supply/demand driven spike in energy prices is seen as a threat to the already sensitive U.S. economic recovery. Many economists believe rising energy costs would squeeze disposable income on Main Street...(read more)

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Mortgage Rates: Near One-Month Lows

Hot news from AZ Home Help:

Posted To: Mortgage Rate Watch

Mortgage rates benefited from a "flight to safety" this week. A "flight to safety" happens when investors are nervous about owning risky assets like stocks, but do not want to miss out on earning a return on their funds, so they allocate their money into risk-free government guaranteed U.S Treasury debt to provide a safe-haven AND an investment return. As benchmark Treasury yields fall on "flight to safety" buyer demand, prices of mortgage-backed securities move higher in unison. This allows lenders to reprice their rate sheets for the better and gives originators an opportunity to offer fence-sitting borrowers lower mortgage rates or more competitive closing costs. Conflict in Libya and the potential for a spillover into other oil producing countries has energy traders nervous about shrinking...(read more)

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MBS Rally Holds Steady Despite Strength in Equities

Hot news from AZ Home Help:

Posted To: MBS Commentary

Since the last piece of economic data for the week was released at 9:55am, MBS have been in rally mode, recently meeting resistance at their highest levels in nearly a month. On Wednesday we said that 101-28 was the bullish target we needed to hit in order for Best Execution C30 loan pricing to improve to 4.875%. That happened yesterday. We hope you're not complaining about loan pricing spreads because we feel lenders are actually being quite giving at the moment. After hitting 101-27 following Consumer Confidence data, Fannie 30yr 4.5 MBS haven't gone any lower than 101-25...despite a sustained stock market rally. And while this is no guarantee that this tight range will continue to hold through the close, it has resulted in some reprices for the better, and more may follow if these levels...(read more)

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Mortgage Rates: Best Execution Improves to 4.875%

Hot news from AZ Home Help:

Posted To: Mortgage Rate Watch

Mortgage rates continue to benefit from a "flight to safety". A "flight to safety" happens when investors are nervous about owning risky assets like stocks, but do not want to miss out on earning a return on their funds, so they allocate their money into risk-free government guaranteed U.S Treasury debt to provide a safe-haven AND an investment return. As benchmark Treasury yields fall on "flight to safety" buyer demand, prices of mortgage-backed securities move higher in unison. This allows lenders to reprice their rate sheets for the better and gives originators an opportunity to offer fence-sitting borrowers lower mortgage rates or more competitive closing costs. Conflict in Libya and the potential for a spillover into other oil producing countries has energy traders nervous about shrinking...(read more)

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Foreclosure Sales Fall in Fourth Quarter 2010. Asterisks Noted

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Posted To: MND NewsWire

Despite a sizeable drop in the fourth quarter, sales of foreclosed properties again accounted for over a quarter of all single-family home sales in 2010. Sales of foreclosed homes represented almost 26 percent of all sales during the year, down from 29 percent in 2009. The discount buyers received for these homes was 28 percent off the average sale price of a non-foreclosed property compared to a 27 percent discount in 2009. The RealtyTrac Year and Q4 2010 U.S. Foreclosure Sales Report T M released on Thursday states that a total of 831,574 residential properties that had either been foreclosed or were in some stage of foreclosure were sold to third parties during the year. This was a 31 percent drop in these sales from the 2009 level, but was a larger market share as the volume of non-foreclosed...(read more)

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Mortgage Rates: Steady Despite Weak Treasury Auction

Hot news from AZ Home Help:

Posted To: Mortgage Rate Watch

Mortgage rates continue to enjoy a period of relief after rising rapidly in recent weeks. The extent to which this relief period matures into a more extended and stable mortgage rate rally is still undecided, but at least now it's possible. Those looking to stay as protected as possible even during potentially more favorable times still need to keep an eye out for the risks that crop up along the way. We discuss the current risks in the "New Guidance" section below. CURRENT MARKET : The "Best Execution" conventional 30 year fixed mortgage rate is 5.00%. There is an opportunity to lock 4.875% for those who wish to buy down their rate, but this quote carries higher closing costs than 5.000%. The upfront cost of permanently buying down your rate from 5.000 to 4.875% may not be worth it to every...(read more)

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MBS Rally Targets: Battling Profit Takers and Short Sellers

Hot news from AZ Home Help:

Posted To: MBS Commentary

As we discussed yesterday, the momentum that has been negative for benchmark Treasuries and production MBS coupons throughout February... may be shifting. MUST READ BACKGROUND CONTENT: Directional MBS Alert: Bond Market Builds Case for Lower Rates We remind though, rates don't move lower as fast as they move higher. This shift won't be served up on a silver platter. A change of bias will take time to confirm. We will undoubtedly face pressure from bearish short sellers and profit takers along the way. There will be periods of volatility and increased anxiety that will lead us to question the potential for further positive progress. Beware. There are short term milestones that must be met if the recovery rally is to extend for mortgage rates. These inflection points and targets will be important...(read more)

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Mortgage Rates: Best Execution Improves to 5.00%

Hot news from AZ Home Help:

Posted To: Mortgage Rate Watch

Mortgage rates have spent the better part of a month teetering on a ledge. At risk was a phenomenon we describe as "snowball selling". The end result would have been another 0.25 to 0.375% jump in home loan borrowing costs....the third spike in as many months. WHAT IS SNOWBALL SELLING? Mortgage rates have rallied in six of the last 7 sessions though and we've slowly backed away from the ledge. To illustrate the recent behavior of mortgage rates, we offer the chart below. It graphs the average origination closing costs associated with specific mortgage note rates as quoted by the five major mortgage lenders. If the note rate line is moving up, the closing costs associated with that rate quote are rising. In December, closing costs rose rapidly. Mortgage rates did improve from those levels, but...(read more)

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Public Perception of Originator Compensation Changes; Details on Redwood Non-Agency MBS Deal; Several Investor Updates;

Hot news from AZ Home Help:

Posted To: Pipeline Press

What is the public hearing and seeing regarding the April Fool's Day changes? "Starting April 1, under a new compensation rule from the Federal Reserve, borrowers who get their mortgages through brokers will most likely pay less for their services and must be offered the lowest possible interest rate and fees for which they qualify. The new rule also affects those dealing with small banks and credit unions, which typically do not fund loans from their own resources. But most banks and other direct lenders, including the few mortgage companies that function like banks, are exempt." SOUNDS MISLEADING! Details of the latest Redwood Trust March 1 st deal are emerging . The $290 million residential MBS are backed by 303 loans, roughly 2/3 from First Republic Bank and the rest by PHH Mortgage . The...(read more)

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Compensation Discussions Around the Country; QRM, MERS updates

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Posted To: Pipeline Press

There's a saying, "We are born naked, wet, and hungry. And then things get worse." But perhaps, just perhaps, smaller mortgage brokers and bankers won't see things get worse with the Qualified Residential Mortgage ("QRM") plans . Dodd-Frank requires lenders to retain 5% of the credit risk of any mortgages closed outside of the guidelines - but what are the guidelines? Will it be based on agency - effectively killing the jumbo/non-agency market? What if the agency guidelines go away? Will it be based on LTV, cutting into FHA or the MI company business share? Anyway, the issue has been somewhat quiet, but recently the Senate Banking Committee heard from FDIC Chairman Sheila Bair, and she told members that regulators will soon release its QRM that will determine how much risk loan originators...(read more)

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Refinancing Borrowers Shun ARMs in Q4. Opt for Shorter Loan Terms

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Posted To: MND NewsWire

Americans are increasingly turning away from variable rate mortgage products when refinancing according to the Quarterly Product Transition Report issued by Freddie Mac. An increasing share of refinancing borrowers also chose to shorten their loan terms during the fourth quarter. In the fourth quarter of 2010, fixed-rate mortgages (FRM) accounted for more than 95 percent of all loans used for refinance. Frank Nothaft, Freddie Mac vice president and chief economist commented that "Fixed mortgage rates continued to slide lower during the first part of the fourth quarter, reaching 4.17 percent for the 30-year mortgage in mid-November in Freddie Mac's Primary Mortgage Market Survey® and the lowest fixed rates since the early 1950s. It's no wonder borrowers are attracted to fixed-rate loans...(read more)

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Mortgage Rates: Nearly Unchanged Today

Hot news from AZ Home Help:

Posted To: Mortgage Rate Watch

Although costs inched slightly higher today, the overall picture of this week in mortgage rates was finalized today and it doesn't look too bad. In terms of costs, the secondary mortgage market is nearly one full percent higher than it was at the lowest points on Monday. The day was uneventful and not the most informative in terms of market-based events or volume. Losses looked more severe this morning, but by the end of the day, the secondary market had battled back to close out the week just slightly worse than yesterday's prices. CURRENT MARKET : The "Best Execution" conventional 30 year fixed mortgage rate is no longer split between 5.125% and 5.25%....it has fallen firmly to 5.125%. After today's gains, there's an opportunity at 4.875% for those who wish to buy...(read more)

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MBA: Delinquency Rates Down, Some to Pre-Recession Levels

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Posted To: MND NewsWire

There was a lot of good news in the Fourth Quarter National Delinquency Study released by the Mortgage Bankers Association (MBA) Thursday. First, the overall, seasonally adjusted delinquency rate (which does not include loans in foreclosure) fell to 8.22 percent, a decrease of 91 basis points from a 9.13 percent rate in the third quarter and down 125 basis points from the same period in 2009. Jay Brinkmann, MBAs chief economist said that the non-seasonally adjusted rate showing a decrease of 46 basis points to 8.93 percent might be even better news. There is usually a sharp spike in the rate in the fourth quarter, perhaps because homeowner's budgets are impacted by the first home heating bills of the season. That the rate fell this time indicates that the downward movement may be real. Delinquencies...(read more)

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Mortgage Rates: Back To Winning Ways, But Still Defensive

Hot news from AZ Home Help:

Posted To: Mortgage Rate Watch

A 3 day winning streak for mortgage rates ended yesterday, but in gentle fashion. This allowed us to keep our best execution 30-year fixed mortgage rate at 5.125%. Today, however, the secondary mortgage market was back to its gaining ways, actually ending up in even better shape than Tuesday evening. CURRENT MARKET : The "Best Execution" conventional 30 year fixed mortgage rate is no longer split between 5.125% and 5.25%....it has fallen firmly to 5.125%. After today's gains, there's an opportunity at 4.875% for those who wish to buy down their rate, as this will involve much higher closing costs than 5.125, but among the potential rates attainable with buy-downs, 4.875 is the best-execution among them. The upfront cost of permanently buying down your rate from 5.125% to 4...(read more)

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MBS Underperforming as Treasuries Stall. More Reprices Possible

Hot news from AZ Home Help:

Posted To: MBS Commentary

Some reprices for the worse have already been seen and more may follow if current trends prevail or even if they simply fail to reverse course. What are those trends? Several are aligning to raise the risk for continued reprices for the worse: MBS performing worse than benchmarks (aka "widening"), lenders having relatively aggressive rate sheets out (makes them more sensitive to market movements), and of course the much discussed bearish technical resistance still faced by the bond market in general. The technical resistance is most pronounced as 10yr notes attempt to break below 3.60 (and keep failing). While yields have danced around that level at times this morning, we're far from seeing a definitive and confirmed break, not to mention we've seen our fair share of weakness as well. But where...(read more)

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Mortgage Rates: Winning Streak Ends Gently

Hot news from AZ Home Help:

Posted To: Mortgage Rate Watch

Yesterday we shared news that mortgage rates were on a three day winning streak. This allowed us to update our best execution 30-year fixed mortgage rate from a range between 5.125 and 5.25% to simply 5.125%. Unfortunately that three day winning streak came to an end today, but it didn't happen in a particularly painful fashion as rates are basically unchanged from yesterday. Today was not without its excitement though. It was one of the more volatile days we've had recently in the secondary mortgage market, but at the end of the day, lender rate sheets were basically unchanged. CURRENT MARKET : The "Best Execution" conventional 30 year fixed mortgage rate is no longer split between 5.125% and 5.25%....it has fallen firmly to 5.125%. 5.00% quotes are available but borrowers should expect to...(read more)

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Homebuilders Still Hampered by Appraisal Inaccuracies and Lack of Financing Options

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Posted To: MND NewsWire

The nation's homebuilders are still seeing a lot of dark tunnel ahead judging by their responses in the most recent survey of attitudes about the home sales market conducted by the National Association of Homebuilders (NAHB). According to results of the survey the NAHB/Wells Fargo Housing Market Index (HMI) released Tuesday remained stuck at 16 for the fourth consecutive month. The survey, which has been conducted for over 20 years, measures the confidence of homebuilders using three criteria; builder expectations of current single-family home sales and their expectations for sales over the next six months, each measured as "good," "fair" or "poor;" and their perceptions of prospective buyer traffic as "high to very high," "average" or "low to very low." Scores from each component are then...(read more)

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Mortgage Rates on Three Day Winning Streak

Hot news from AZ Home Help:

Posted To: Mortgage Rate Watch

Mortgage rates are on a three day winning streak! Yes you read that correctly. After snapping a 5-day losing streak last Wednesday, loan pricing has improved in 3 straight trading sessions. Upon careful inspection, we are ready to update current market "best execution".... UPDATED CURRENT MARKET* : The "Best Execution" conventional 30 year fixed mortgage rate is no longer split between 5.125% and 5.25%....it has fallen firmly to 5.125%. 5.00% quotes are available but borrowers should expect to be charged origination fees if they choose to permanently buydown their note rate. The upfront cost of permanently buying down your rate from 5.125% to 5.00% may not be worth it to every applicant. We would generally advise the permanent floatdown if you plan to hold your new mortgage for longer than...(read more)

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Mortgage Rates: Still on a Ledge. Still Defensive

Hot news from AZ Home Help:

Posted To: Mortgage Rate Watch

We watched defensively last week as mortgage rates teetered on a ledge. We were searching for an indication that "snowball selling" had been avoided before offering a new directional guidance. No sign was shared by the secondary market but we did manage to back a bit further away from the mortgage rate ledge before heading into the weekend. Snowball selling in the secondary mortgage market forces lenders to reprice their rate sheets for the worse. At first the impact is only higher closing costs, but as the snowballing gains momentum and reprices for the worse get bigger and bigger...the "Best Execution" 30-year fixed mortgage rate spikes higher. Mortgage rates face a condensed calendar of influential events in the week ahead. Planned topics of debate include: inflation, the President's 2012...(read more)

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FHA Announces Fee Hike. Targeted Relaxation of Regs Ahead?

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Posted To: MND NewsWire

That was quick.... FHA TAKES STEPS TO BOLSTER CAPITAL RESERVES New premium structure for 30- and 15-year loans will help private capital return WASHINGTON – As part of ongoing efforts to strengthen the Federal Housing Administration’s (FHA) capital reserves, FHA Commissioner David H. Stevens today announced a new premium structure for FHA-insured mortgage loans increasing its annual mortgage insurance premium (MIP) by a quarter of a percentage point (.25) on all 30- and 15-year loans. The upfront MIP will remain unchanged at 1.0 percent. This premium change was detailed in President Obama’s fiscal year 2012 budget, also released today, and will impact new loans insured by FHA on or after April 18, 2011. “After careful consideration and analysis, we determined it was...(read more)

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Housing Finance Reform: Reduced Loan Limits, Larger Down Payments, Higher FHA MIP Fees

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Posted To: MND NewsWire

The long-awaited report on the future of housing finance has been released by the Obama Administration. Below is the presser.... I highlighted some talking points. The first thing to take away from this paper is the Administration's intention to wind down Fannie and Freddie on a responsible timeline. That tells you this reform/winding down process will take many years and much debate. 5 to 7 years according to Treasury Secretary Tim Geithner. There's nothing wrong with that though. Slow and steady works as long as lenders have funding liquidity in the process. The main goal is to get housing finance reform done right....the first time, this market can only take so much more stress, rewriting regs repeatedly would be detrimental to the overall housing recovery process. Next on the list of observations...(read more)

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