MBS RECAP: Bond Markets Still Coming to Terms With Week’s Losses

Posted To: MBS Commentary

Bond markets continued to trade resiliently through the close today with the help of month-end buying demand. A small-scale battle played out earlier this morning between those month-end buyers and the more tactical sellers looking to push yields higher to set up better entry points (i.e. push prices down in order to buy bonds later). These two classes of investors are often referred to as “real money” (pension funds, money managers, insurance funds, etc) and “fast money” (leveraged accounts, prop desks, hedge funds). Real money is where month-end buying demand comes from and that buying clearly …read more

Mortgage Rates Hold Steady at 1-Month Highs

Posted To: Mortgage Rate Watch

Mortgage rates avoided any further damage today after moving to the highest levels in a month yesterday. The past two days made for the sharpest increase in rates since late August, with today’s offerings remaining relatively unchanged for some lenders and just a bit lower for others. Even after taking the minor improvements into account, today’s average conventional 30yr fixed rate quote is at lease an eighth of a point higher the same quote on Tuesday afternoon. Most lenders are quoting 3.875% to 4.0% versus a previous range of 3.75% to 3.875%. There is definitely …read more

Mortgage Fraud Stable; Jumbo Loans at most Risk

Posted To: MND NewsWire

Incidents of fraudulent mortgage applications remained stable in the second quarter of 2015. CoreLogic, in its Fraud Report for the quarter, estimates the number of applications with indications of fraud at 12,814. This is an increase from the 11,100 applications that appeared fraudulent to some extent in the same quarter of 2014. While the numbers are large, as a percentage of all applications the share shrunk from an already miniscule 0.69 percent to 0.67 percent. CoreLogic’s Mortgage Application Fraud Risk Index, decreased by 8.9 percent nationally from its Q2 2014 level. Despite the size of that …read more

Pending Home Sales Trends; Flood Insurance Update; UG on the Block?

Posted To: Pipeline Press

Besides the adults taking over Halloween, and the underwriting department duking it out with accounting to see who takes home this year’s department costume prize, much of the United States will change their clocks Sunday morning (the end of daylight saving time). They then, 133 days later on March 13 of 2016, will change them back. If you think it’s a hassle to change the clocks for a little over 1/3 of the year, like Hawaii, most of Arizona, Midway Atoll, Wake Island, and a small region of Alaska who say “leave us out of this”, …read more

MBS Day Ahead: Technically Speaking, Bonds are in Trouble. Too Obvious?

Posted To: MBS Commentary

One of my favorite little snippets of analytical wisdom (or perhaps it's an out that I leave myself in case I'm wrong… yes, that's probably it) is something to the effect of the following: The biggest risk to this assessment is how obvious it is. When I dust off this gem, it's not meant to imply that one thing is necessarily more likely to happen than another. Rather, it's to let you know that anyone looking at the technical landscape would be experiencing some sort of tunnel vision on similar conclusions. This time around, the obvious …read more

MBS RECAP: Widespread Negative Reprices as Sell-Off Gets Real

Posted To: MBS Commentary

10yr yields have gone from around 2 percent to 2.17% in 2 days thanks to the Fed's sucker punch. Mind you, this would be a lot worse if some of the market wasn't already wondering if the Fed would take this opportunity to set the expectation for a strong possibility of a December rate hike . Still, it left many market participants surprised, and they've subsequently had to get with the program in fairly short order. In today's case, all we know is that it wasn't time to stop selling yet. GDP data was a supporting …read more

Mortgage Rates Highest in a Month Today

Posted To: Mortgage Rate Watch

Mortgage rates continued heading higher at a fairly quick pace today, extending the move that began after yesterday’s Fed Announcement. That might come as somewhat of a surprise if you’ve read basically any other article about mortgage rates today. Reason being, Freddie Mac releases its weekly rate report on Thursdays and the rest of the free world promptly publishes articles conveying the data. The only problem is that Freddie’s rate report isn’t intended to provide an up-to-the-minute glimpse at recent mortgage rate movement. It’s not only of no use to consumers actively engaged in the …read more

MBS MID-DAY: Bond Markets Extending Post-Fed Weakness; Data Not Helping

Posted To: MBS Commentary

Yesterday was obviously bad for bond markets. The shift in tone from the Fed caught many market participants off guard. Since the announcement, Fed Funds Futures have moved to price in better than a 50 percent chance of a December hike versus about a 1 in 3 chance before the announcement. While it wouldn't have been unfair to expect traders to take more time to come to terms with the surprise (read: more selling today), bond markets actually began the overnight session holding relatively steady. It wasn't until the earliest domestic trading activity began that we …read more

Inventories, Rocky Financial Markets Blamed for Pending Sales Dip

Posted To: MND NewsWire

It wasn’t just new home sales that slipped in September. The National Association of Realtors® (NAR) reports that pending sales also cooled; dipping nationally and in all four regions. NAR’s Pending Home Sales Index (PHSI), a forward-looking indicator based on purchase contract signings , pulled back from the slightly downwardly revised August level by 2.3 percent to 106.8. It was the second straight decline and it brought the PHSI to its second lowest level of the year – is was 103.7 in January. The Index was still 3.0 percent higher than in September 2014 and this …read more

Jobs, Layoffs; Big Week for Bank M&A; Fee Changes and Price Adjustment Trends

Posted To: Pipeline Press

Let’s start with something non-mortgage related but that may be of interest to some. Who doesn’t go faster than the posted speed limit on a freeway? Certainly not Sammy “I Can’t Drive 55” Hagar. Nor Google. Google’s driverless cars will exceed legal speed limits so they can keep up with other drivers. Google’s self-driving cars will be designed to exceed maximum speed limits, in a move to “improve safety.” The lead engineer for the project has revealed the vehicles will go 10mph (16km) faster than the speed limit. I am not clever enough to think of …read more