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MBS RECAP: Settling Into Holiday Weekend Drift	5/24/2012 2:09 PM
Posted To: MBS Commentary MBS Live : MBS Afternoon Market Summary This morning, we suggested that markets are relatively out of trading ideas until the next big-ticket items start hitting and thus, might use whatever opportunities arise to make course corrections within a broader range (read more about the SNEAKY TRICK if you missed it this morning). We also noted that there are different ways to determine what that "broader range" might be. Now with today's trading mostly in the books, not only are we getting ongoing confirmation of these "course corrections within a broader range" but there's an emerging visual representation of this in 10yr yields (which, as you may know, we prefer to MBS as far as assessing trends in interest rates despite the fact that this is an MBS site, especially when bigger potential shifts...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Mortgage Rates Higher Today, Still Bouncing Around All-Time Lows	5/24/2012 12:02 PM
Posted To: Mortgage Rate Watch Mortgage Rates continue to experience minor volatility near all-time lows, bouncing moderately higher today after moving lower yesterday. The move didn't take rates any higher than Tuesday's rather abrupt short-term highs, and despite the fact that rates have moved in opposite directions every day this week, the actual rates quoted should have remained the same for most scenarios while the variations would be limited to borrowing costs. That means that when we reference "higher rates," the Best-Execution Rate for Conventional 30yr Fixed Loans remains at 3.75%, but closing costs would be higher for that rate today vs yesterday (or the amount of lender credit would be lower, depending on your scenario). (Read More: What is A Best-Execution Mortgage Rate? ) Markets were generally calmer today...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
RMBS Investigators Announce Website, Coordination Team	5/24/2012 11:39 AM
Posted To: MND NewsWire The Residential Mortgage-Backed Securities (RMBS) Working Group unveiled a new website on Thursday to enable "whistleblowers" to report mortgage-backed securities (MBS) related misconduct. The group also announced the creation of a new team to coordinate various securities-related investigations around the country. The Working Group is part of the Financial Fraud Enforcement Task Force ( FFETF ) created in January to address fraud leading to the financial crisis. The group is led by five co-chairs representing the civil and criminal divisions of the Department of Justice, the Securities and Exchange Commission, and two attorneys general from New York and Colorado. According to a press release, the working group and its members are focused on investigating potential false or misleading statements...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
MBA Hikes 2012 Origination Forecast by $200 Billion	5/24/2012 10:55 AM
Posted To: MND NewsWire The Mortgage Bankers Association ( MBA ) is projecting that mortgage originations in 2012 will be $200 billion higher than was originally anticipated. Almost all of the increase will be coming from a boom in refinancing, but none of the additional originations are pegged to the Home Affordable Refinance Program (HARP 2.0.) MBA said it now expects that the industry will do $1.28 trillion in business in 2012, up from $1.26 trillion in 2011. The new number is an upward revision of $188 billion from the number MBA put out in April, driven by an increase in the pace of refinance applications and originations. Refinancing is now expected to generate $870 billion during the year, virtually the same amount as in 2011. At the same time, MBA revised its estimate of purchase loan origination downward...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Understanding Your Operation is Critical to Profits; Recent Lender/Investor Updates	5/24/2012 9:41 AM
Posted To: Pipeline Press (There aren't many folks in the world who, on their death bed, would exclaim, "I wish I had another day of work!" With that in mind, I am biking around in the high country in Southern Utah, camping with no internet, and Brad Nease with Carrington is pinch hitting for a portion of today's commentary - brought to you through the wonders of modern technology. Thank you Brad! And there are still some lender updates, and a little humor at the end.) Let's talk revenue. Are you the CEO, President, CFO, or head of Secondary? If I were to walk into your company, right now, and ask: What is your company making (in basis points)? What is your gross or top end number? What is your net or bottom line number? Do you know? Would you be able to go directly to an excel spreadsheet and point to your GOS (?);...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
MBS MID-DAY: Leaking Weaker In Lackluster Volume	5/24/2012 9:27 AM
Posted To: MBS Commentary MBS Live : MBS Morning Market Summary There's not really much to today's weakness. It's moderate, it's steady, and it began yesterday. After hitting the strongest recent levels yesterday morning, MBS and Treasuries have been grinding slowly and steadily weaker. Speaking of "slowly," MBS have been fairly quiet today and yesterday, while Treasuries have been moving along at healthy clip. In both sides of the market, the movement is consistent with our assertion that there's not much to do apart from RANGE-TRADE ahead of more significant events in the coming weeks. That's a fairly high probability phenomenon unless we get a major piece of news to nudge prices/yields out of said ranges. Even then, the actual boundaries of the ranges are somewhat open to interpretation, but certainly 1.80 stands...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
OIG Recaps October-April Oversight of FHFA	5/24/2012 8:06 AM
Posted To: MND NewsWire In its third semi-annual report to Congress the Federal Housing Finance Agency's (FHFA) Office of the Inspector General (OIG) recapped its activities during the six month period ending April 30. OIG is charged with promoting transparency in FHFA's program administration and oversight of the operations of the two government sponsored enterprises (GSEs) which are in government conservatorship Fannie Mae and Freddie Mac as well as the third GSE, the Federal Home Loan Banking System (FHLBanks). OIG is also charged with preventing and detecting fraud, waste and abuse in the operation of the GSEs as well as FHFA itself. In addition to enumerating the various reports it had issued on both FHFA and GSE activities and the recommendations resulting from them, Thursday's report contained a special section...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
The Day Ahead: Moderate Data and Treasury Auction Planning a Sneaky Trick	5/24/2012 5:52 AM
Posted To: MBS Commentary With very limited data and an early close on Friday, today will serve as the last trading day of the week in many regards. For starters, it's the last of the Treasury coupon auctions, this time 7yr Notes at 1pm . Yesterday's 5yr auction was almost completely uneventful though, though we're cognizant of fact that markets' interest had perked up a bit about European headlines after the morning shocker that Eurozone officials told members to make contingency plans for a Greek Eurozone exit. So a fuller reaction could have been muted by impending or anticipated events, but we still wonder how much markets even care about the 7yr issuance, and indeed how much they care about the ongoing demonstration of that which is already known--US Treasuries are in high demand as a safe-haven. Data too, fell...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Freddie Mac: Data Starting to Paint Picture of 2012	5/23/2012 2:16 PM
Posted To: MND NewsWire Freddie Mac said that first quarter 2011 economic data that has begun to emerge from various sources are, even though some is preliminary, beginning to create an impression of what the year may hold. Data on economic growth indicates that the quarter had slower growth than the one that preceded it but was still up from three of the previous four quarters. The slower growth primarily reflected less inventory accumulation and a dip in residential construction. According to the corporation's Economic and Housing Market Outlook for May, personal consumption grew at a 15.3 percent annual basis and residential fixed investment added 0.4 to the quarter's 2.2 percent economic growth. This factor, which primarily reflects new housing construction and home remodeling, has been up for four straight quarters...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
MBS RECAP: Early Gains on Europe, Late Weakness on Stocks	5/23/2012 2:08 PM
Posted To: MBS Commentary MBS Live : MBS Afternoon Market Summary Once again bond markets came into the session at better levels achieved during overnight trading. In fact, things were looking up ever since ex-Greek PM Papademos noted that a Greek Euro-zone exit was a real risk. Everything since then has been a continuation on that same theme, culminating in the Euro hitting multi-year lows and bringing 10yr yields down 1.71% mid-day. MBS hit 104-19 at their highs (Fannie 3.5's) but fell to the 104-10 pivot point by 4pm. 10yr yields rose to test their 1.75% pivot point into the stock market close. Trough to peak, S&P's put in a massive 23 point gain. MBS Pricing Snapshot Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live. FNMA 3.5 104-11 : +0-02 FNMA...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Mortgage Rates Reclaim Some Of Yesterday's Losses	5/23/2012 12:58 PM
Posted To: Mortgage Rate Watch Mortgage Rates improved today , gaining back a good portion of yesterday's losses as European markets continued keeping pressure on domestic stock prices and interest rates. The biggest move for markets came on the news that Euro-zone officials agreed that member countries should be working on contingency plans for a Greek Euro-zone exit. Although the news was batted around as credible and untrue alternately, markets didn't seem to care. The Euro hit a multi-year low and 10yr yields fell to their lowest levels in nearly a week. Yesterday we noted that, despite rising rates, the recent weakness till fit within the scope of a 'leveling off' but that if rates continued rising today that could start to change. Thankfully, today's improvements keep us well within the original 'leveling off' theme...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Fed Consumer Video Spotlights Independent Foreclosure Reviews	5/23/2012 10:44 AM
Posted To: MND NewsWire The Federal Reserve has posted a video for homeowners informing them of their right to an independent review of their foreclosure files if they believe they were harmed by their servicer. The nearly four minute long video is available in English, Spanish and has an accompanying hard-copy transcript. The narrator, the Fed's Anna Alvarez Boyd, lays out the eligibility requirements for the program, the deadline for which has recently been extended to July 31, 2012, and the procedures for requesting a review. Boyd also advises viewers to beware of persons trying to use the program to defraud them. Notably missing from the video is any information on why a homeowner might want to request a review. There is no mention of possible compensation, merely that the requestor will eventually receive a letter...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
April New Home Sales Bounce Back after March Drop	5/23/2012 10:01 AM
Posted To: MND NewsWire Sales of new single-family houses in April 2012 were at a seasonally adjusted annual rate of 343,000 , according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 3.3 percent above the March rate of 332,000 and is 9.9 percent above the April 2011 estimate of 312,000. The March rate had originally been estimated at 328,000 so this revision somewhat moderates to -5.9 percent the sharp 7.1 percent decline which had been the focus of the March report. On a non-seasonally adjusted basis there were an estimated 33,000 homes sold during the month, up from 32,000 in March. This was the highest number of estimated monthly sales since April 2010 when there were 41,000 sales. Sales one year earlier, April 2011, totaled 30,000. At...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
MBS MID-DAY: Bond Markets Benefit From European Sell-Off	5/23/2012 9:38 AM
Posted To: MBS Commentary MBS Live : MBS Morning Market Summary While it may have mostly run it's course by now, the morning has been dominated by big moves in several of the markets from which domestic Treasuries often take cues. MBS have been able to share some of that spotlight, but Treasuries are certainly the star of the show. German Bunds, global equities, US Treasuries, and the Euro itself have all been waltzing lower this morning without any regard to domestic economic data at 10am. The chart below shows the strong connection between Bunds and Treasuries as well as the strong correlation with the Euro and Stocks (represented here by S&P futures). With the 5yr Auction the next event of note at 1pm, there's not much left for this morning but to keep an ear out for further EU Summit headlines. Incidentally...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
FHFA Index Shows Modest Home Price Increases	5/23/2012 9:16 AM
Posted To: MND NewsWire Another survey is reporting that U.S. home prices have managed a recent slight rebound. The Federal Home Finance Agency's (FHFA) is reporting that home prices nationwide as measured by its seasonally adjusted Home Price Index (HPI) increased a modest 0.6 percent in the first quarter of this year compared to the fourth quarter of 2011. Most of the increase came in March, the last month of the quarter when the index rose 1.8 percent from February. The HPI showed an even more modest increase from the first quarter of 2011 of 0.5 percent, however this was the first annual increase shown in a first quarter since 2007. "Consistent with other housing market indicators, the FHFA HPI showed stronger house prices in the first quarter, most notably in March ," said FHFA Principal Economist Andrew Leventis...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
BofA Repurchases $330M from Freddie; Delinquencies Down, Sales Prices Up - What's Going On? AIG Back in Subprime	5/23/2012 8:40 AM
Posted To: Pipeline Press Here is an interesting note for debt market students: Germany is scheduled today to sell two-year bonds that won't make set interest payments . The move reflects the safe harbor of German debt while revealing trepidation about the euro zone. There is even talk of German bonds with negative yields. "In these uncertain times, people are more concerned about the return of capital rather than the return on capital," said one strategist at Lloyds Bank. (Our 2-yr. was auctioned off yesterday with a yield of .3%.) But others reach for yield. Any time someone sees a headline like, " AIG ventures back into subprime mortgages" it can cause shudders. But yup, that's the deal . Expansion is the name of the game for many lenders. Majestic Home Loan is looking for Branch Managers, Area Managers, Retail Loan...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Low Rates Drive Third Weekly Hike in Refinancing	5/23/2012 7:27 AM
Posted To: MND NewsWire The Mortgage Bankers Association (MBA) credited record low interest rates for third consecutive increase in refinancing during the week ended May 18. According to its Weekly Mortgage Applications Survey, the Refinancing Index increased 5.6 percent from the previous week to reach the highest level since February 10. Refinancing applications comprised 76.6 percent of the total volume of applications during the week compared to 74.9 percent the week ended May 11. The increase in demand for refinancing pushed the seasonally adjusted Market Composite Index which measures overall mortgage loan application volume, up 3.8 percent. The unadjusted index increased 3.3 percent. The seasonally adjusted Purchase Index fell by 3.0 percent from one week earlier and the unadjusted Purchase Index was down 3...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
The Day Ahead: EU Summit, Housing Data, And A More Relevant Auction	5/22/2012 8:49 PM
Posted To: MBS Commentary As noted in the MBS RECAP, yesterday was basically spent bouncing back from overnight weakness. The weakness itself was somewhat frustrating in that it was the result of a general, pervasive selling trend that began right at the start of the Asian session and kept on going until the New York open. In fact it's still going... Wait, what? See... the "trick" here is that we're not talking exclusively about y'day's overnight session weakness. In fact, the real turning point for bond markets was the afternoon of the 17th when the domestic close marked the lowest 10yr yields since last Fall. Everything since then has been one big trend-channel of "pull back." See? So while we DID spend most of the waking hours of yesterday's session either holding steady or rallying, those gains totally fit within...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
MBS RECAP: Trying To Find A "Happy Place" After Three Days Of Losses	5/22/2012 2:22 PM
Posted To: MBS Commentary MBS Live : MBS Afternoon Market Summary MBS spent the day doing battle with weakness from the overnight session, and were certainly successful within the confines of the domestic session, but the fruits of those labors are mostly noticeable in MBS Prices as opposed to lenders' rate sheets. The overnight weakness started us off in a bad way, testing 104-04 support levels--a pretty scary place to be after beginning the week hoping to hold 104-16 pivot points, breaking lower and hoping to hold 104-10 by the end of the day. So perhaps we can better appreciate that lenders might have been sensing a "scary pattern of losses" seemingly forming, and with the uncertainty created by tomorrow's EU Summit along with the more germane 5yr Treasury Auction, how they might be somewhat 'less aggressive' (to...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Mortgage Rates Continue Rise From Recent Lows	5/22/2012 12:30 PM
Posted To: Mortgage Rate Watch Mortgage Rates rose again today , this time at a slightly faster pace than yesterday's moderate increase. All of the market movement responsible for the increase in rates was seen in the overnight session, during European and Asian market hours, whereas the domestic hours were relatively uneventful. Yesterday we mentioned that the recent weakness looked more like a 'leveling off' from last Thursday's market levels and despite the incremental weakness in rates markets, today's movement is still mostly consistent with that view. That said, if rates continue to worsen tomorrow, at the very least, it will significantly widen the scope of what "leveling off" could mean. Here's why... For now, 'leveling off' simply means the the borrowing costs associated with prevailing Best-Execution rates are...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
NAR Declares Start to Housing Comeback	5/22/2012 9:31 AM
Posted To: MND NewsWire The housing recovery is underway according to the National Association of Realtors® (NAR) which released numbers on Tuesday to back up that claim. Existing home sales rose from March to April and are well above sales one year ago. Prices are on the rise as well and the improvements were felt across all regions of the country. Total existing home sales in April including single-family homes, townhomes, condominiums, and cooperative apartments increased 3.4 percent to a seasonally adjusted annual rate of 4.62 million. This was an increase of 3.4 percent from March although those figures were revised down from an original estimate of 4.48 million to 4.47 million. April sales were 10.0 percent higher than the 4.30 million-unit level one year earlier. Single-family sales rose to 4.09 million...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
MBS MID-DAY: Dealing With Weakness Gracefully	5/22/2012 9:28 AM
Posted To: MBS Commentary MBS Live : MBS Morning Market Summary Bond markets continue trying to hold their ground so far this morning against what, thus far, looks to be a nominal correction within recent broader ranges. Although MBS prices are lower and Treasury yields are higher, this is a long-term net-positive so far today. In other words, bond markets can't and won't rally every day, and on the days where we're not rallying or holding steady, it's our hope that weakness will be experienced in measured and logical doses. This appears to be the case as 10yr yields are attempting to grind out support either from the horizontal SUPER LONG TERM pivot at 1.80 or from the lower limits of the trend channel seen in the chart below MBS are similarly holding onto support levels so far today with Fannie 3.5's easily above...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
Buybacks Wearing on Industry; Fannie, Freddie and Wall Street; FHA & Condo Project Changes?	5/22/2012 7:35 AM
Posted To: Pipeline Press Pick an overwhelming percentage, like 80 or 90%. Remember when residential loan production wasn't "that" percent agency? Non-agency loans are still out there and periodically being securitized (just ask Redwood Trust in the jumbo sector), but by most accounts the market is "dislocated." And if you're a large bank, who is flush with cash from deposits, there is certainly no urgency to securitize the product and move it off your books - just keep earning the spread. But here is an update on the non-agency world . Hey, what would a week in mortgage banking be like without a huge new lawsuit to, once again, cause everyone to wonder about being in this business? In this one, the FDIC is suing the big banks over mortgage debt losses. In a recent speech Federal Reserve Chairman Bernanke discussed...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
LPS Posts "First Look" at April Mortgage Metrics	5/22/2012 6:55 AM
Posted To: MND NewsWire Lender Processing Services, Inc. (LPS) has issued some preliminary data on mortgage performance from its April Mortgage Monitor report which will be released by the end of the month. The data is derived from the LPS database of 40 million loans. The total U.S. delinquency rate which includes loans 30 or more days past due but not yet in foreclosure rose 0.4 percent from March figures to 7.12 percent but was down 10.6 percent from April 2011. There are 3,522,000 delinquent residential mortgages including 1,595,000 that are 90 or more days past due. The foreclosure pre-sale inventory was composed of 2,048,000 properties, a rate of 4.14 percent. This rate was unchanged from both the previous month and one year earlier. The combined total of past-due mortgages and the foreclosure pre-sale inventory...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.
The Day Ahead: Weekly Momentum Still Building Toward Wednesday	5/22/2012 6:00 AM
Posted To: MBS Commentary Overnight volume leading into yesterday's session made it seem like it might turn out surprisingly strong, but Treasury trading around 4am New York time turned out to be the most exciting of the day, leaving domestic working hours to short of chop sideways very uneventfully very much INSIDE (lower highs and higher lows) the extremes from the previous 2 days of trading. Production MBS didn't much care for it and after trying to hold sideways in the morning, basically gave up in the afternoon. That said, the damage was minimal with only a few ticks separating highs and lows. In fact that's the broader trend for bond markets in general. Volatility continues to be very well contained. Despite the aggressive outright levels, the manner in which we've arrived here has been just as uneventful and...(read more) Forward this article via email: Send a copy of this story to someone you know that may want to read it.

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