Category: Mortgage News Daily

Posted To: MBS CommentaryMost of today’s bond market movement followed a single trade in the morning hours. Someone with deep pockets bought a lot of 2yr Treasury debt and sold some longer-term debt in the process. This type of “curve trade” (so named because its intent is to take a position on the movement of the yield curve ) is common. Curve trades are happening all the time every day. This one was just much bigger than normal. That doesn’t mean it’s necessarily significant, however, as the week after Thanksgiving (which often includes the last few trading days of November) typically sees a unique combination of certain traders getting back into the market after the holiday while other traders are getting into requisite positions for month-end . The big morning trade acted to reinforce a floor…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: Pipeline PressI want a free vacation! I want a free fancy car in the garage in my newly-built McMansion! Apparently, due to sagging sales, with some builders I can indeed have those things, and more. Builders in many locales are proving that, regardless of which administration is in power, or who takes credit for some aspect of the economy doing well, business cycles are a fact of life . Lenders know a lot about business cycles, and the number of nonbank mortgage lenders was down by about 3.5% at midyear from the end of 2017, according to the Conference of State Bank Supervisors. (Speaking of “wants,” if you want an “Air Selfie” for Christmas, aka mini-drone, here you go .) Lender Products and Services “Lendsnap is the favorite Digital Mortgage app for non-QM Lenders. Our partners…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: MBS CommentaryMarkets will be getting back into the swing of things (probably slowly) today after the Thanksgiving holiday. As we discussed excessively last week, nothing about the last 3 or 4 trading days will necessarily have any bearing on how this week plays out. We may well see a lopsided battle between buyers and sellers resulting in a quick move back toward recent high yields, or an unexpectedly strong move to the lowest yields since September. If we get the weak move, it would mean that bonds opted to bounce fairly perfectly right where they bounced in late October (3.03% in terms of 10yr yields). If we get the strong move, it’s meaning would depend on what else is going on in other markets. For instance, if bonds rally simply because stocks are tanking, that would be different than bonds rallying…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: Mortgage Rate WatchMortgage rates were every bit as flat as expected today. That’s a good thing at the moment, considering we’re holding in line with the lowest levels in more than a month. For the average borrower, that’s roughly an eighth of a percentage point lower than 2 weeks ago, when rates were near 8-year highs. The Thanksgiving week is typically uneventful for the bond markets that underlie mortgage rates, largely due to inconsistent participation among traders and other people in the supply chain for rates. The pace tends to pick up in the following week and especially in the first week of December as markets settle in to their final approach ahead of the mid-December Fed Announcement–oftentimes a focal point of end-of-year volatility. Loan Originator Perspective As expected, bond markets slumbered…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: Pipeline Press”Why is it that when the CDC warns us to not eat romaine lettuce, we take it as gospel. But when the CDC tells us that vaccines save lives, we think they’re part of the Illuminati?” Good question. Another good question is, “Is affordable housing going away?” There is a lack of affordable housing available for many first-time or middle-class homebuyers in certain areas. And gaps are widening. For example , the share of single-family homes valued at a million dollars or above “has grown 7.6% over the past year alone, and doubled since 2012, increasing from 1.5% to 3.6% of all homes on the market.” Just as the wealth gap widens, luxury or high-priced housing is generally isolated to the coasts. Interestingly, Suburban Boston is the only neighborhood in the top…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: MBS CommentaryI could go on and on about why it makes so very little sense for today to be a business day and for Thursday to be the official Thanksgiving holiday. To add insult to injury, the powers that be in the bond world have decided today should be a half day. Would it not make more sense to reassign Thanksgiving Day to the 4th Friday of the month and then create a another holiday for Thursday? We could call it “Meal Prep Day” or “What Do You Mean You Only Have Frozen Turkeys Day?” With the above proposed changes, we could have the half day on Thursday and then a full day on Friday. Same amount of closed time, but much less angst. Let’s get a petition started! But I digress. Today is indeed a market day, sort of… It tends to be one of the most random market days of the year…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: MND NewsWireThe share of loans that were for refinancing and those where borrowers opted for adjustable rate mortgages (ARMs) both ticked up in October , with the latter garnering the largest share in recent memory, 8.2 percent. This was a full percentage point higher than the September share. According to Ellie Mae’s Origination Insights Report, the split between refinancing and purchase loans jumped from 29/71 in September to 32/68 in October. Both VA and FHA showed an uptick in their refinancing activity. Closing rates for all loans increased to 72.2 percent in October, the highest point this year and up from 71.7 percent the previous month. Closing rates on refinances increased slightly, from 64.4 percent to 64.9 percent, and closing rates on purchases held steady at 76.4 percent for the second consecutive…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: MBS CommentaryI used to be annoyed by the word “consolidation.” It was on a short-list of market jargon words that were overused and possibly nebulous. But over the years we’ve become friends . If it has annoyed or confused you, give it another chance. You might just find a new friend. I’m not sure what kind of market terminology glossaries there are out there, but I can make it easy for you with one synonym: REGROUPING . The word “regrouping” sounds kind of weird as a noun. Otherwise, I think it’s an even better term than “consolidation.” Either way, we’re talking about markets moving sideways after a rally or sell-off. Oftentimes, the sideways movement initially takes the shape of a push back against the previous move (i.e. a sell-off gives way to a nice little…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: MND NewsWireExisting home sales broke their extended losing streak in October, increasing 1.4 percent from September to a seasonally adjusted annual rate of 5.22 million completed sales. It was the first positive report on sales of existing single-family homes, condos, townhouses, and co-op apartments since last March. The National Association of Realtors® (NAR) said the gain was not enough however to return existing home sales activity to 2017 levels. They lag the 5.5 million transactions last October by 5.1 percent After overshooting the mark with their last six forecasts, analysts polled by Econoday were more restrained and consequently quite accurate in their expectations for October. Their predictions were in the range of 5.10 to 5.35 million units with a consensus of 5.20 million. Single-family…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Posted To: Mortgage Rate WatchMortgage rates were almost perfectly flat today, and have been largely unchanged since last Friday. If you were forced to predict such a thing at the end of last week, the odds would have been in your favor. In other words, when rates are on the move, Thanksgiving week tends to see a temporary pause in that movement. Bond markets and mortgage lenders will naturally be closed for the holiday tomorrow. They will technically be open on Friday but participation will vary widely. Many lenders won’t update their rate sheets. Others will only make token changes unless financial markets are unexpectedly wild. The following week should see market and mortgage rate activity pick up again. Happy Thanksgiving! Loan Originator Perspective As expected, bond markets slumbered through today, eyeing the Thanksgiving…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.