MBS RECAP: Weak GDP Helped Some, FOMC got out of the way

Posted To: MBS Commentary

Heading into the last hour of trading on this all-star day, bond markets have moved at a fairly average pace, albeit in rate-friendly directions. The direction is welcome, but the magnitude of the move risks being a disappointment considering the magnitude of the miss in GDP (0.1 vs 1.2 forecast). The caveats are well known and twfold: 1. It's NFP week so with the much bigger consideration coming up the day after tomorrow, markets hesitate to move as much as they otherwise might. 2. The perennial frustration of interpreting data that's been tainted with the stench …read more

Mortgage Rates Improve on Weak GDP, Tame Fed Announcement

Posted To: Mortgage Rate Watch

Mortgage rates fell at a solid pace today following a reading on 1st Quarter GDP that was much weaker than expected. Downbeat economic data tends to benefit bond prices, including the mortgage-backed-securities (MBS) that most directly influence rates. When prices rise, rates fall. The good times kept rolling in the afternoon when the Fed Announcement arrived essentially unchanged from the previous version. The most prevalently quoted conforming 30yr fixed rate for best-case scenarios ( best-execution ) remains at 4.375% in most cases, but the costs associated with that rate fell back to mid-month levels. That …read more

GSE’s Pass FHFA Stress Tests with no Treasury Debits

Posted To: MND NewsWire

This will be the first year that financial institutions will be required to submit to stress tests under the Dodd-Frank Wall Street Reform and Consumer Protection Act. Previous stress tests, dating back to 2010, were required and conducted by the Treasury Department. Like other financial companies with consolidated assets of more than $10 billion and which are regulated by a primary federal regulatory agency, Freddie Mac and Fannie Mae (the GSEs) will be required to take the tests to determine if they have the capital necessary to absorb losses as a result of adverse economic conditions. …read more

MBS MID-DAY: Bond Markets Staying Strong After Mixed Morning Data

Posted To: MBS Commentary

The blue line is stocks; yellow is 10yr yields. When we see a chart like this on the last 2.5 days of the month– ESPECIALLY when the recent norm has been for stock prices and bond yields to travel together–the tacit suggestion is that bond markets are benefiting from 'month-end' buying. Money managers and other account types have certain trades that either must be made or that would simply be advantageous/prudent to make by the end of the month. This can arise from the need to match a certain published index or simply to “hit numbers” …read more

Interest-Only Recasts; Referral Fee Discussion; MBA App Numbers

Posted To: Pipeline Press

What has Wells Fargo’s Economics Group been writing about recently? The economic recovery, of course; more specifically, how does one compare economic recoveries across economic recoveries with any sort of meaning? The group writes in Different Times for the U.S. Consumer , “the recovery from the Great Recession has lasted, so far, 56 months, from July 2009 until February 2014. In order to compare the current recovery to past recoveries, we calculated the change in disposable personal income (DPI) and the change in personal consumption expenditures (PCE) from the end of the recession up until the …read more

Mortgage Applications Lowest Since 2000

Posted To: MND NewsWire

The week ended April 25 was one of the slowest for mortgage application activity the industry has seen in years. The Mortgage Bankers Association (MBA) said applications for both purchase mortgages and refinancing decreased and its Market Composite Index, a measure of overall mortgage applications volume, fell to its lowest level in almost 15 years. The Composite decreased 5.9 percent on a seasonally adjusted basis from the week ended April 18 and was down 5 percent on a non-seasonally adjusted basis. Refinancing activity fell 7 percent and purchase applications were off 4 percent from a week …read more

MBS RECAP: Weaker to Start; Back in the Range by Afternoon

Posted To: MBS Commentary

It was a generally quiet day for bond markets, though that wasn't destined to be the case at the open. Treasuries had weakened slightly overnight and the onset of domestic trading only exacerbated the weakness at first. 10yr yields briefly matched their highest levels in a week before a supportive technical bounce. MBS were also in weaker territory until a slightly weaker Consumer Confidence reading facilitated a return to yesterday's range. The afternoon saw a gradual, almost flat move in the same positive direction. Some of the improvement has been attributed to S&P's downgrade of several …read more

Price Increases Slow in Latest Case Shiller Report

Posted To: MND NewsWire

The S&P/Case-Shiller 20-City Composite Index rose slightly in February on a seasonally-adjusted basis, beating analysts’ expectations by a hair while showing slowing rates of home price gains. The 20-City Index was up 0.8 percent against consensus expectations of 0.7 percent. The 10-City Index rose 0.9 percent. The 20-City rose 13.1 percent compared to February 2013 and the 10-City was up 12.9 percent on an annual basis. There was no change on an unadjusted basis. Thirteen cities saw lower annual rates of appreciation than in January and thirteen saw lower month-over-month increases. Las Vegas had the largest …read more

Mortgage Rates Slightly Higher Ahead of GDP and Fed

Posted To: Mortgage Rate Watch

Mortgage rates were slightly higher today as a result of bond market weakness late yesterday and again this morning. Some of that weakness has been erased this afternoon, but trading levels in MBS (the mortgage-backed-securities that most directly affect mortgage rates) still aren’t back to yesterday morning’s range. Rate sheets were worse this morning, but the market improvements during the day have allowed a few lenders to revise rate sheets for the better. On average, most lenders are still showing higher costs compared to yesterday’s latest levels. The most prevalently quoted conforming 30yr fixed rate …read more

Foreclosures Up in March, but Down 10 Percent from Last Year

Posted To: MND NewsWire

Completed foreclosures increased by nearly 6 percent in March, moving from 45,000 in February to 48,000. CoreLogic said this morning that there were, however 10 percent fewer foreclosures than in March 2013 when 53,000 homes were foreclosed. The total number of foreclosures for the 12 months ended in March declined for the 27 th consecutive month and was the lowest aggregate sum since December 2007. The company estimates that there have been about 5 million homes lost to foreclosure since the housing crisis began in September 2008 and, while the incidence is down dramatically from the …read more