Category: Mortgage News Daily

Posted To: MBS CommentaryOvernight weakness in bonds sets us up to test some more serious boundaries today. As seen in the chart below (the same chart we’ve been watching for the last few weeks), yields have now risen to the bleeding edge of the consolidation range (upper yellow line). As always, breaking through would suggest a bit of extra momentum. The exception to that general truth occurs when the higher momentum begins BEFORE yields actually break out of a range. That could be what we’re seeing right now due to the timing of seasonal trading patterns. September often changes the summertime tone, and this time around, it’s been decidedly bad for bonds. My sense is that the market is waiting for its fears to be confirmed or rejected with the week’s remaining data/events. If CPI, the ECB announcement…(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 CommentaryBonds/rates are in the process of defending their castle. Their way of life inside those walls could be thought of as the general maintenance of a long-term ceiling near 3.0%. On several occasions, invaders have broken the outer perimeter and attempted to overrun the castle. It was only with the help of mercenaries from Italy and Turkey that the invaders were ultimately turned away. To be clear, we’re not talking about actual mercenaries. That was a reference the Italian political drama in late May and the Turkish Lira crash in early August. Those events both blossomed just as 10yr yields were pushing over 3% and provided enough of a ” risk-off ” motivation for US yields to recover. And while the enemy isn’t necessarily at the gates to the same extent this time around, they…(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 NewsWireLast week we summarized a report from the National Association of Home Builders on the acute labor shortages builders are indicating in responses to the NAHB/Wells Fargo monthly Housing Market Index survey. The July version asked a set of special questions about the availability of both employed labor and subcontractors in each of 15 different trades. That survey also asked builders about the effects the shortages were having on their businesses. Paul Emrath again examines on the survey results in NAHB’s Eye on Housing blog and says the most widespread effects are on wages. Eighty-four percent said they were having to pay higher wages and take higher bids from subcontractors, and 83 percent said this has forced them to raise home prices. Seventy-three percent said the shortages were making…(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 slightly higher today, depending on the lender . Many lenders ended up raising rates last Friday afternoon as underlying bond markets weakened. The remaining lenders had more distance to cover in terms of getting caught up with market movements. The average lender is just slightly worse off. Unfortunately, that puts rates at the highest levels in more than a month. Whereas there was clear cause and effect behind Friday’s rate spike, today has been relatively drama-free and movement free. This can be viewed positively or negatively. On the one hand, it’s nice to see rates seemingly holding their ground here after Friday’s spike. On the other hand, the fact that rates AREN’T doing more to recover suggests they’re not too terribly opposed to feeling out these new, higher levels…(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 CommentaryPerhaps traders were tired? Perhaps they are still on high alert but just haven’t gotten to the week’s more meaningful events yet? Either way, there was effectively no drama for bonds today. This is both good and bad. On a positive note, it was nice to come into the office today and NOT witness yields continuing to rise above the 2.95% ceiling (10yr) that came under pressure last week. On a negative note, it was disconcerting to see yields continue holding so close to that ceiling. In other words, it looks like bonds sold-off as much as they wanted to on Friday, and we’re now waiting for the other shoe to drop . Said shoe could be some combination of Treasury/Corporate supply in the first half of the week or some combination of the ECB announcement and US inflation/Sales data at…(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 PressYou’d be hard-pressed to find someone who hasn’t slept in a car at least once in their life. Whether it is having too much to drink, weary during a road trip, rain during a camping trip, on their way to a golf tournament, whatever. Even wealthy cities like Berkeley and Seattle are seeing a boom in people calling their cars and RVs “home.” That is one form of “affordable” but residential companies are very interested in what is happening with affordable lending and here is a primer on the topic for a basic grasp of the topic. Training and Events It’s not too late – there is still time to register! American Pacific Mortgage has released the complete agenda for their 2018 Fall Symposium: The Power of You! The Symposium will be held in San Diego on September 13-14…(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 NewsWireWhether due to lessons learned from the foreclosure crisis, an improved economy, or a combination of these and other factors, Black Knight, in its current Mortgage Monitor , shows that foreclosure prevention measures can work . The company says that the reperforming loan (RPL) market now has nearly 1.84 million borrowers who are current on their mortgages. At some point each of these was at least 120 days past due on that obligation. This pool of borrowers represents $306 billion in outstanding mortgage debt. The number of borrowers who have cured serious delinquencies is up by 30,000 since the first of the year as many of those who fell behind due to last year’s hurricanes have been able to catch up on their payments. Sixty-percent of these RPL borrowers, about 1.1 million, have been reperforming…(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 rose moderately today (depending on the lender). It was enough to bring them back to the highest levels since early August. Additionally, we can expect them to be slightly higher on Monday unless underlying bond markets improve in Asia and Europe. Reason being: there was additional weakness in bonds this afternoon and most lenders didn’t go to the trouble of adjusting their rate sheet offerings to account for it (though several lenders did). Weakness in bonds equates to higher rates, in general. As for underlying causes, today was all about the big jobs report this morning. Typically, bond markets will weaken if the report shows stronger job creation. That wasn’t exactly the case today. While the tally of new jobs was higher than expected, it wasn’t an impressive result by the…(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 CommentaryToday’s bond market wrap is as simple as the headline. Average hourly earnings or AHE is occasionally responsible for some impressive moves in bonds. Today was one of those days. Part of the problem was that there wasn’t really any weakness in the payrolls number to offset the wage gains. Granted, previous months had some downward revisions, but the biggest one was all the way back in June. July’s revision was then perfectly offset by August’s ‘beat’ (i.e. -10k revision to last month and today’s NFP beat the forecast by 10k). All that to say that there was some extra focus reserved for any other standout line items in the data. Average hourly earnings stood out because August’s numbers took the annual numbers past an important ceiling, 2.9% vs 2.8%. We’ve…(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 CommentaryThis morning’s first chart is actually Private Payrolls (as opposed to nonfarm payrolls). Reason being: NFP accounts for Census Bureau hiring which creates massive, temporary spikes and drops in payroll counts every 10 years. Thus, if we look at long term charts of NFP, they’re underlying message is corrupted by this artificial ingredient. Instead, we can just look at private sector payrolls (“private payrolls”) for a more even-keeled idea of the trend. No matter which payroll count we’re examining, it’s apparent that we haven’t seen an outlying drop (something below 150k) for nearly a year. The caveat is that April’s initial reading fit that description, but was later revised up to 153k. The point, however, is that we have several recent examples of payrolls…(read more)Forward this article via email:  Send a copy of this story to someone you know that may want to read it.