MBS RECAP: Only Volatile if You Were Standing Too Close

Posted To: MBS Commentary

Bonds responded generally favorably to the available economic data, which included on-target ADP jobs numbers (177 vs 175k forecast) and weaker Chicago PMI (51.5 vs 54.0 forecast). That only helped us in the morning, however. European bond market weakness pulled yields higher into the European close, and month-end volatility at home caused a few more swings by the end of the day. If you were to only look at today's bond market movement relative to yesterday's, things looked downright volatile. 10yr yields began the day above yesterday's highest yields and within 2 hours had swung well …read more

Mortgage Rates Exceptionally Flat

Posted To: Mortgage Rate Watch

Mortgage Rates were unchanged today, ending a month without much movement in general. In fact, the most prevalently quoted conventional 30yr fixed rate on top tier scenarios remained in a range of 3.375-3.5% for more than 45 days! That’s the sort of absence of volatility that greatly decreases the need to stress out about locking or floating your rate, but as always, the question is whether or not that will continue to be the case. Near-term volatility in rates can come from the economic data over the next two days. Markets are anxious to see …read more

Pending Home Sales Second Highest in 10 Years

Posted To: MND NewsWire

Despite some predictions that pending home sales would fall in July, they actually rose modestly to reach their second highest level in over a decade. The National Association of Realtors® reported that its Pending Home Sales Index (PHSI) was up 1.3 percent to 111.3 from a downwardly revised (from 111.0) 109.9 in June and was up 1.4 percent compared to July 2015. The index had reached its highest level since February 2006 this past April when it hit 115.0. The July index was second only to that number. NAR pronounced the increase in purchase contracts as …read more

Deep Dive on FHFA’s Home Price Figures; Wells on Investing With Imperfect Info

Posted To: Pipeline Press

What does $24 million buy you in Oregon ? Just find 24 people to pony up a million each. Some economists love to look at the FHFA’s housing statistics. Newly minted math and statistics majors, and summer interns, employed by the FHFA to put them together, also love them. These numbers, of course, only reside in the world of Freddie Mac and Fannie Mae, nut are useful to a limited degree, especially when viewed in context and taken over several months. Things look pretty good , and we certainly see a different picture than a few …read more

MBS Day Ahead: Month-End Bond Buying Could Be A Trap

Posted To: MBS Commentary

Who remembers asymptotes from high school? Those are the curved lines that gradually approach a certain level–getting closer and closer, but never reaching it. Sometimes in bond markets, instead of the normal triangular consolidations (i.e. linear trends of “higher lows” and “lower highs” converging), we instead have a static level on one side and an asymptotic line on the other side. A picture makes it easier to see, and it just so happens to apply to the current environment where 10yr yields have had a ceiling around 1.60 (with the brief exception of the Jackson Hole …read more

MBS RECAP: Uneventful Day For Bonds Confirms Range-Reentry

Posted To: MBS Commentary

Today was very different than the past two days. Friday was one of the biggest days of selling seen during the July/August time frame and yesterday was one of the larger rallies (though neither were especially large in broader contexts). Today covered a mere 1/5th of the ground covered on Friday, and barely more than a third of yesterday's range. From a technical standpoint, that means that Friday's break outside the recent range has been ” rejected ” and yesterday's reentry to the range has been ” confirmed .” As for today's specific considerations, I'd start …read more

Mortgage Rates Back in Familiar Range For Now

Posted To: Mortgage Rate Watch

Mortgage Rates did one of two things today, depending on the lender in question. Some lenders simply held in line with yesterday’s latest levels (in other words, they were ‘unchanged’ on the day). Other lenders had some ground to make up because they maintained more conservative pricing. This second group kept rates a bit higher yesterday even as most of their peers were offering mid-day price improvements due to big gains in bond markets. In these cases, the lenders used this morning’s calm bond market environment to bring their rates back in line with the …read more

Mortgage Bank Profits Doubled in Q2

Posted To: MND NewsWire

Mortgage originators surveyed by the Mortgage Bankers Association (MBA) saw production profits more than double in the second quarter compared to what had been a dismal Quarter One. Independent mortgage banks and mortgage subsidiaries of chartered banks told MBA they had averaged a net gain of $1,686 on each loan originated during the quarter, up from $825 per loan during the previous period. Marina Walsh, MBA Vice President of Industry Analysis, commented in the company’s Quarterly Mortgage Bankers Performance Report that “Production profits more than doubled in the second quarter of 2016, as production volume rose …read more

Price Gains Moderating, But Some Metro Areas Stand Out

Posted To: MND NewsWire

Results are in for the final two of the four major home price indices for June. Both the S&P CoreLogic Case-Shiller Indices and Black Knight Financial Services’ Home Price Index (HPI) show continued price appreciation throughout the country with Case-Shiller reporting the appreciation tended to be greatest in two regions , the South and the West. Case-Shiller’s U.S. National Home Price Index, which covers the nine U.S. census divisions, was up 5.1 percent compared to June 2015, the same year-over-year increase that was posted in May. The non-seasonally adjusted national index posted a month-over-month gain of …read more

Trends in FHA & VA; Agency/Lender Changes; Note on Improving Borrower Profiles

Posted To: Pipeline Press

I asked my cat Myrtle for her comments on the proposed TRID changes. (Blank stare.“Myrtle, make up your mind – in or out!”) I did, however, receive this note from a veteran broker regarding the changes. “Every comment I read online basically said this is onerous or worse . I didn’t go through all of them but did not see one in favor of TRID. Everyone should express their opinion even if it’s only 2-3 lines . (One can read the comments in the right column.) The three-day rule is a joke on refis although for …read more