Daily Newsletter: REO Could Become A Serious Problem; Rates Jump Back to 14-Month Highs; Worst Month For MBS

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30 Year Fixed

4.00%   +0.06

15 Year Fixed

3.14%   +0.05

10YR Treasury

2.13%   +0.0145

FNMA 30YR 3.5

103.64   -0.31

FNMA 15YR 2.5

104.00   -0.19

Friday May 31, 2013
MND NewsWire – 3:10PM
As the housing crisis unrolled the Department of Housing and Urban Development (HUD) and the two government sponsored enterprises (GSEs) Freddie Mae and Fannie Mae came into possession …
Mortgage Rate Watch – 4:03PM
Mortgage rates moved back up to the highest levels of the week , confirming a bumpy ride between now and next week’s big jobs report. The day began in a docile enough fashion but was …
MBS Commentary – 6:04PM
MBS Live : MBS Afternoon Market Summary If we consider the worst 5-week batches of time for production MBS, and even if we allow late 2010 to combine the worst 5 weeks spanning November …
MND NewsWire – 4:57PM
The massive public database of consumer complaint information which the Consumer Financial Protection Bureau (CFPB) brought on-line in March has now been enhanced. The Bureau announced …
MBS Live Chat – 2:35PM

“This sideways, down, sideways down, ,sideways down, pricing is disconcerting. Like a waterfall……..”

MBS Live Chat – 2:36PM

“still can’t lock at Wells…”

MBS Live Chat – 2:37PM

“Thank God it will be June when we next meet!…”

MBS Live Chat – 2:38PM

“Bring on JUNE!…”

MBS Live Chat – 2:38PM

“I second that…May, you can go now!…”

Today’s Rates
Best Execution
Rate Change
30 Yr FRM 4.00% +0.06
15 Yr FRM 3.14% +0.05
FHA 30 Year Fixed 3.55% +0.05
Jumbo 30 Year Fixed 4.20% +0.04
5/1 Yr ARM 2.90% -0.01
Average Mortgage Rates
Rate Points Change
FHFA *
15 Yr. Fixed 3.03% 0.84 +0.07
30 Yr. Fixed 3.77% 1.20 +0.03
MBA **
30 Yr. Fixed 3.90% 0.39 +0.12
15 Yr. Fixed 3.10% 0.30 +0.14
30 Yr. Jumbo 4.07% 0.27 +0.14
30 Yr. FHA 3.62% 0.27 +0.09
5/1 ARM 2.60% 0.24 +0.00
Freddie Mac **
30 Yr. Fixed 3.81% 0.80 +0.22
15 Yr. Fixed 2.98% 0.70 +0.21
1 Yr. ARM 2.54% 0.50 -0.01
5/1 Yr. ARM 2.66% 0.50 +0.03
* FHFA averages are updated monthly.
** Mortgage Bankers Association (each Wednesday) and Freddie Mac (each Thursday) averages are updated weekly.
Secondary Markets
MBS
Price Change
30YR FNMA 3.0 100.61 -0.36
30YR FNMA 3.5 103.64 -0.31
30YR GNMA 3.0 101.95 -0.27
30YR GNMA 3.5 105.20 -0.23
15YR FNMA 3.0 104.00 -0.19
15YR FNMA 2.5 102.11 -0.22
Treasuries
Yield Change
2 YR 0.2972% +0.0002
5 YR 1.0274% +0.0145
10 YR 2.1317% +0.0145
30 YR 3.2774% -0.0034
Prices as of: 5/31/2013 4:32PM EST
MBS and Treasury data provided by Thomson Reuters.
Mortgage News Daily and MBS Live! are exclusive re-distributors of Real Time Thomson Reuters Mortgage Information.
Secondary Marketing Managers:
If you are interested in gaining access to the most accurate real-time back-month TBA indications from Thomson Reuters and Tradeweb. Request More Information
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[Community Commentary] – Do’s and Don’t’s For a Smooth Mortgage Process

Do’s and Don’t’s For a Smooth Mortgage Process

Posted to: Community Commentary
Friday, May 31, 2013 7:04 PM

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Every borrower wants their mortgage closing to be simple and stress free.  While it may not always feel like it (between loan processors’ requests for your 2011 Schedule E and page 6 of  March’s bank statement), lenders want the same thing.  Here are some timely “do’s and (mostly hypothetical) don’ts” for borrowers to consider during the loan application process.  While no single list can completely cover all loans, following these “do’s and don’ts” during your mortgage application process will help you close your loan faster, sleep better at night, avoid premature gray hair, and help your loan officer give you the best service possible.  Look for more helpful hints soon, and happy mortgage hunting!

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[MBS Commentary] – MBS RECAP: Fitting End To Worst Month in Modern MBS History

MBS RECAP: Fitting End To Worst Month in Modern MBS History

Posted to: MBS Commentary
Friday, May 31, 2013 4:05 PM

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If we consider the worst 5-week batches of time for production MBS, and even if we allow late 2010 to combine the worst 5 weeks spanning November and December, May 2013 is still 12 ticks worse, give or take.  That’s insane!  Is it just me or do the past 5 weeks not feel as abusively awful as late 2010?  If May seemed any more tolerable, maybe it had to do with the fact that rates began the month within spitting distance of all-time lows and at their worst just ebbed into the 4% zone.  Too, perhaps the fact that we got a starkly contrasting Jobs Report on May 3rd helped start the month off with a cautionary bias.  Whatever the case, today was a fitting end.  It had all the key ingredients…  Seemingly serene morning leading to a massive mid-day sell-off and afternoon volatility in abundance.  Fannie 3.0s end the month just perfectly 400bps off May 1st levels.  10yr yields shot 46.2bps higher!  Everything about this most recent week and the week ahead continue to suggest a well-traveled, volatile range leading up to NFP, with potential to push the push the boundaries of weakness afterward, or head back into May’s trading range.

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Daily Rate Update: Mortgage Rates Jump Back To Recent Highs

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30 Year Fixed

4.00%   +0.06

15 Year Fixed

3.14%   +0.05

10YR Treasury

2.13%   +0.0145

FNMA 30YR 3.5

103.64   -0.31

FNMA 15YR 2.5

104.00   -0.19

Mortgage Rates Jump Back To Recent Highs
May 31, 2013

Mortgage rates moved back up to the highest levels of the week, confirming a bumpy ride between now and next week’s big jobs report.  The day began in a docile enough fashion but was soon disrupted by stronger than expected economic data.  Trading conditions deteriorated further in the afternoon prompting many lenders to recall rate sheets for a mid-session move higher.  With those changed, the closing costs associated with the current 4.0% best-execution rate moved back to the highs seen on Tuesday afternoon.

Yesterday’s thoughts (after two days of improvements in rates) still apply.  It continues to be the case that we could move sideways to lower, and of course rates just demonstrated their willingness to snap back to recent highs:

The important message is that we’re not out of the woods on rate volatility, even if shorter term corrections seem to suggest it.  It may well be the case that move sideways to lower heading into next Friday and catch a break with the data, but it’s also possible that markets take rates back to recent highs as they test out all possible locations for the donkey’s tail before taking off the blindfold on the morning of the Jobs Report.

Loan Originator Perspectives

My comments all week have indicated a locking bias, which is difficult because volatility can lull you into thinking things are going to get better. But that stance turned out to be the right one this week, as the rate spike resumed to end the week. This trend is likely to continue next week. ” –Julian Hebron, Branch Manager, RPM Mortgage

“No playing games with your home loan and floating is playing games in my book. I’m locking everything and advising to lock as insurance against more pain next week. The only thing that will slow this train down is a bad jobs report. Even if we hit the 170K consensus, which is not a real good number to begin with, rates will still rise. Beat the number and look out….Friday morning will be an early start to the weekend.” –Mike Owens, Partner, Horizon Financial Inc.

“We regained a bit of ground we lost at the open as weekly unemployment #’s were up and the 7 year Treasury auction went well. It’s encouraging to see a decent day after a strong one in MBS Land, we’re had immense difficulty stringing good days together for last month. It APPEARS we’ve at least broken the downtrend, will hope that continues. Borrowers still need to be aware that rates are significantly higher than most of May, albeit better than they were late last week! I wouldn’t object to a client who wanted to float till tomorrow, but beware Friday afternoons as pricing often suffers then.” -Ted Rood, Senior Originator, Wintrust Mortgage

“Do you think the market will come back? Answer: It doesn’t matter. In an environment of rising rates, a bird in the hand is better than two in the bush. Borrowers should strongly consider locking the very day they are eligible to do so, as worst case scenario they can refi again, if and when rates come back. It appears that is not likely, so take the lowest rate for the day and be happy that you were still able to capitalize near the historical bottom….you can still hold your head high at the cocktail party.” –Brandon Blue, CA Broker & Owner at BlueLoanServices.com

Today’s Best-Execution Rates

  • 30YR FIXED – 4.00%
  • FHA/VA – 3.25% or 3.75% 
  • 15 YEAR FIXED –  3.125%
  • 5 YEAR ARMS –  2.625-3.25% depending on the lender


Ongoing Lock/Float Considerations

  • After rising consistently from all-time lows in September and October 2012, rates challenged the long term trend higher, but failed to sustain a breakout
  • EU and domestic economic data remain relevant to mortgage rates, but uncertainty over the Fed’s bond-buying plans through the rest of the year is causing volatility 
  • The further we’ve progressed into 2013, the faster the swings have become
  • Fears about the Fed’s bond-buying intentions were proven well-founded on May 22nd when rates rose to 1yr highs after the Fed confirmed their intention to taper bond buying programs sooner vs later
  • Just as the pendulum pushed far to the positive side of the rate range in April, the opposite swing occurred in May (now the worst single month for rates on record since 2008)
  • (As always, please keep in mind that our talk of Best-Execution always pertains to a completely ideal scenario.  There can be all sorts of reasons that your quoted rate would not be the same as our average rates, and in those cases, assuming you’re following along on a day to day basis, simply use the Best-Ex levels we quote as a baseline to track potential movement in your quoted rate).
30 Year Fixed Rate Mortgage

15 Year Fixed Rate Mortgage

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Today’s Rates
Best Execution
Rate Change
30 Yr FRM 4.00% +0.06
15 Yr FRM 3.14% +0.05
FHA 30 Year Fixed 3.55% +0.05
Jumbo 30 Year Fixed 4.20% +0.04
5/1 Yr ARM 2.90% -0.01
Average Mortgage Rates
Rate Points Change
FHFA *
15 Yr. Fixed 3.03% 0.84 +0.07
30 Yr. Fixed 3.77% 1.20 +0.03
MBA **
30 Yr. Fixed 3.90% 0.39 +0.12
15 Yr. Fixed 3.10% 0.30 +0.14
30 Yr. Jumbo 4.07% 0.27 +0.14
30 Yr. FHA 3.62% 0.27 +0.09
5/1 ARM 2.60% 0.24 +0.00
Freddie Mac **
30 Yr. Fixed 3.81% 0.80 +0.22
15 Yr. Fixed 2.98% 0.70 +0.21
1 Yr. ARM 2.54% 0.50 -0.01
5/1 Yr. ARM 2.66% 0.50 +0.03
* FHFA averages are updated monthly.
** Mortgage Bankers Association (each Wednesday) and Freddie Mac (each Thursday) averages are updated weekly.
Secondary Markets
MBS
Price Change
30YR FNMA 3.0 100.61 -0.36
30YR FNMA 3.5 103.64 -0.31
30YR GNMA 3.0 101.95 -0.27
30YR GNMA 3.5 105.20 -0.23
15YR FNMA 3.0 104.00 -0.19
15YR FNMA 2.5 102.11 -0.22
Treasuries
Yield Change
2 YR 0.2972% +0.0002
5 YR 1.0274% +0.0145
10 YR 2.1317% +0.0145
30 YR 3.2774% -0.0034
Prices as of: 5/31/2013 4:32PM EST
MBS and Treasury data provided by Thomson Reuters.
Mortgage News Daily and MBS Live! are exclusive re-distributors of Real Time Thomson Reuters Mortgage Information.
Secondary Marketing Managers:
If you are interested in gaining access to the most accurate real-time back-month TBA indications from Thomson Reuters and Tradeweb. Request More Information
About This Report

Mortgage News Daily is a trusted source of mortgage rate market data and analysis, with over 1 million readers each month.  Unlike many rate surveys, our survey is conducted on a daily basis and is designed to bring you the most current and accurate rate data available.  We use a proprietary formula to calculate averages based on best-execution rates from top lender’s rate sheets, also taking into account feedback from hundreds of mortgage market professionals around the country.

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This information is not an advertisement to extend consumer credit as defined by Section 226.2 of Regulation Z. This is not an offer to enter into an agreement regarding interest rates. The rates quoted do not include discount points, origination points, or loan level risk based price adjustments. Rates presented in this report are averages and are subject to change without notice.
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[MND NewsWire] – CFPB Enhances Massive Consumer Complaint Database

CFPB Enhances Massive Consumer Complaint Database

Posted to: MND NewsWire
Friday, May 31, 2013 1:29 PM

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The massive public database of consumer complaint information which the Consumer Financial Protection Bureau (CFPB) brought on-line in March has now been enhanced. The Bureau announced today that it has expanded its Consumer Complaint Database to include state-by-state information. The CFPB also added complaints about money transfers and credit reporting to the database.

The searchable database allows consumer to track complaints about products and services levied by other consumers. Information is available on more than 90,000 individual complaints which, in addition to the two categories added today, include entries about mortgages, student loans, bank accounts and services.

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[Mortgage Rate Watch] – Mortgage Rates Jump Back To Recent Highs

Mortgage Rates Jump Back To Recent Highs

Posted to: Mortgage Rate Watch
Friday, May 31, 2013 4:03 PM

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Mortgage rates moved back up to the highest levels of the week, confirming a bumpy ride between now and next week’s big jobs report.  The day began in a docile enough fashion but was soon disrupted by stronger than expected economic data.  Trading conditions deteriorated further in the afternoon prompting many lenders to recall rate sheets for a mid-session move higher.  With those changed, the closing costs associated with the current 4.0% best-execution rate moved back to the highs seen on Tuesday afternoon.

Yesterday’s thoughts (after two days of improvements in rates) still apply.  It continues to be the case that we could move sideways to lower, and of course rates just demonstrated their willingness to snap back to recent highs:

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[MND NewsWire] – REO Could Become A Serious Problem For HUD/GSEs

REO Could Become A Serious Problem For HUD/GSEs

Posted to: MND NewsWire
Friday, May 31, 2013 12:58 PM

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As the housing crisis unrolled the Department of Housing and Urban Development (HUD) and the two government sponsored enterprises (GSEs) Freddie Mae and Fannie Mae came into possession of more and more properties thorugh foreclosure. As of September 30, 2012, HUD held 37,445 foreclosed properties (REO) while the GSEs held 158,138. In addition, the “shadow inventory”-residential loans at least 90 days delinquent-totaled 2,674,682 properties, roughly 7.5 times the size of the HUD and GSE REO inventories combined. Even a fraction of the shadow inventory falling into foreclosure could considerably swell HUD and GSE inventories of REO properties.

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