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| Bond Market Hits Reset Button, Poor Econ Data Forecasting, Loan Pricing Review |
Posted To: MBS Commentary A brief market wrap and a few observations heading into the weekend... The October Delivery FNCL 4.0 went out -0-17 at 102-11. Rate sheet influential mortgages, which were trading at extreme oversold spread levels this week, performed well against Treasuries and swaps today, but huge price declines forced lenders to reprice for the worse, pushing mortgage rates higher. As would be expected, originator pipeline hedging picked up today. Over $3bn in new loan production was sold forward in the TBA market, mostly in 4.0 and 4.5 30 year paper. While the damage seems dramatic, after the dust settled, you can see the FNCL 4.0 has landed right back in the middle of it's month long range. Steep MBS price declines were a direct result of a correction in the long end of the benchmark yield curve....(read more)Send a copy of this story to someone you know that may want to read it.  |
| Mortgage News Daily |
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| MBA: 30-Day Delinquencies on the Rise Again |
Posted To: MND NewsWire While it reported that most delinquency figures dropped substantially in the second quarter, the Mortgage Bankers Association's National Delinquency Survey also carried some dishearting harbingers of what might lie ahead. The report showed the seasonally adjusted delinquency rate for all loans at 9.85 percent, a drop of 21 basis points from the first quarter but 61 basis points higher than it was during the second quarter of 2009. Delinquency rate figures include all loans that are at least one payment past due, but do not include loans in the process of foreclosure. When those are added into the total the delinquency rate rises to 13.97 percent compared to 14.01 in the first quarter. Foreclosure actions were started on 1.11 percent of loans, down from 1.23 percent in the first quarter...(read more)Send a copy of this story to someone you know that may want to read it.  |
| Mortgage News Daily |
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| ALERT: Bond Market Repricing for the Worse as Stocks Rally |
Posted To: MBS Commentary Stocks initially sold to the lows of the week after Bernanke's speech flashed across wires but buyers were quick to take advantage of cheap prices. S&Ps have turned around and are now testing yesterday's session highs. The bond market is repricing as risk markets rally. The 2s/10s yield curve is 11bps steeper as the 10-year TSY note has shed over 1 full point and is 13.2bps higher at 2.612%. After consolidating all week, stored energy has been released! Down volume is HUGE! While mortgages are trading well relative to benchmarks, rate sheet influential MBS prices are still deep in the red. The FNCL 4.0 is -0-12 at 102-16 and the FNCL 4.5 is -0-09 at 104-06. 102-16 was the sell off target yesterday.... I know many lenders have delayed pricing but when they do publish, rebate will...(read more)Send a copy of this story to someone you know that may want to read it.  |
| Mortgage News Daily |
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| Bernanke: Recovery Slower Than Expected. Fed Prepared to Provide Additional Stimulus if Necessary |
Posted To: MBS Commentary In his speech, Fed Chairman Ben Bernanke did not venture too far from recent rhetoric. He addressed the slower than expected pace of economic recovery but called attention to the fact that the world is not coming to an end either. To boost investor confidence, he repeatedly reminded us that the Fed stands at the ready to implement emergency measures if economic conditions do worsen considerably, which he feels is an unlikely event. Overall I think we got exactly what we were expecting: THIS IS WHAT WE WERE EXPECTING Here is the entire speech. I called attention to important excerpts... The Economic Outlook and Monetary Policy The annual meeting at Jackson Hole always provides a valuable opportunity to reflect on the economic and financial developments of the preceding year, and recently we...(read more)Send a copy of this story to someone you know that may want to read it.  |
| Mortgage News Daily |
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| Talk from the Trenches: Loan Pricing Margins Getting Crushed as Rally Persists; "Bad Loan Biz" Doing Well; FHA Steamline Product; Buybacks and Credit Overlays |
Posted To: Pipeline Press A statistician is someone who is good with numbers but lacks the personality to be an accountant. What's wrong with this picture: Rates are unbelievable, yet there are many companies out there who are barely writing any loans. Investors are backlogged and swamped, yet mortgage banking employment numbers are down significantly from only a year or two ago. In many markets lenders and investors are fighting over back-office talent, yet in others mortgage professionals go jobless. One wizened mortgage banker wrote, "This persistent rally is killing margins. You can't push any volume through the baleen filter we call compliance and pre-purchase investor due diligence. So loans stall worse than a Cessna 152 on take-off and eventually get renegotiated. Investors are drinking from fire...(read more)Send a copy of this story to someone you know that may want to read it.  |
| Mortgage News Daily |
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| The Day Ahead: Revised Q2 GDP, Fed Chairman Speaks, Consumer Sentiment |
Posted To: MBS Commentary Recap of Yesterday U.S. Treasuries got off to a strong start yesterday but gains were quick to reverse course after a better than expected report on Weekly Jobless Claims. An improved read on the labor market helped cheapen benchmark debt just before the final Treasury auction of the week where $29 billion 7-year notes were scheduled to be sold. While direct bidder participation continued to fade, 7s turned out to be the best auction of the week...mostly thanks to a steller turnout from indirect bidders (again). The long end of the yield curve never looked back after that.... Treasuries rallied into the close as stocks sold into their session lows. The 2.625% coupon bearing 10-year TSY note went out +0-17 at 101-09 yielding 2.481% (-5.9bps). The long bond was the best performer on the curve...(read more)Send a copy of this story to someone you know that may want to read it.  |
| Mortgage News Daily |
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