MBS RECAP: Bonds Sneak Into September Unnoticed

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MBS RECAP: Bonds Sneak Into September Unnoticed

Posted to: MBS Commentary
Friday, August 31, 2018 5:36 PM

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August began with bond yields moving down from 3%, effectively keeping them in a sideways-to-slightly higher trend that arguably dates back to January. The trend may have taken a break in the spring as yields tested a move over 3.10%, but geopolitical considerations and trade tensions quickly caused traders to rethink it.

2018-8-31 close

At times, the range has been as narrow as 2.82-2.88, which is also true for most of this week, and easily true for today. With rates operating so persistently in such a narrow range, there’s little to do but wait for a breakout. Otherwise, we’d just …

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Daily Newsletter: Jumbo Loans Back in Style?; Homeready vs FHA

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30 Year Fixed
4.65% -0.01
15 Year Fixed
4.15% -0.02
10YR Treasury
2.86% +0.0018
FNMA 30YR 3.5
99.41 +0.05
FNMA 15YR 2.5
99.39 +0.02
View Today’s Rates
Friday August 31, 2018
MND NewsWire – 11:11AM
Jumbo Loans Back in Style?
Taking out a mortgage with an origination balance higher than whatever the conventional loan limit was at the time used to be an expensive proposition. Home buyers and refinancers had …
MND NewsWire – 4:37PM
HomeReady: Several Big Advantages Over FHA
Fannie Mae’s 3% down payment HomeReady program was rolled out in 2016. HomeReady has numerous advantages over FHA loans (historically the most common “low down payment” …
MBS Commentary – 10:28AM
MBS Day Ahead: Lowest Volatility Ever, or Close to It
There are a few different ways to measure volatility in the bond market, but one of the simplest is via the average daily trading range. That particular metric is showing volatility …
Mortgage Rate Watch – 5:17PM
Mortgage Rates End Week Near Best Levels
Mortgage rates caught a break to end a week that was otherwise spent moving higher. Although we did see a bit of improvement in underlying bond markets yesterday, lenders were still …

Latest Video


Consumer sentiment index at 96.2 in August

Chicago PMI at 63.6 in August

Fed predictions and more market volatility ahead?

More News from ‘Around the Web’

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Today’s Rates

Best Execution hdr_arrow.png
Rate Change
Current Mortgage Rates »
What are best-execution rates?
30 Yr FRM 4.65% -0.01
15 Yr FRM 4.15% -0.02
FHA 30 Year Fixed 4.37% -0.01
Jumbo 30 Year Fixed 4.33% -0.02
5/1 Yr ARM 3.98% -0.01

Average Mortgage Rates

Rate Points Change
FHFA * hdr_arrow.png
15 Yr. Fixed 3.65% 1.14 +0.09
30 Yr. Fixed 4.19% 1.21 +0.02
MBA ** hdr_arrow.png
30 Yr. Fixed 4.68% 0.46 -0.01
15 Yr. Fixed 4.12% 0.51 +0.05
30 Yr. Jumbo 4.55% 0.37 +0.00
30 Yr. FHA 4.69% 0.81 -0.04
5/1 ARM 3.83% 0.68 -0.10
Freddie Mac ** hdr_arrow.png
Current Mortgage Rates »
* FHFA averages are updated monthly.
** Mortgage Bankers Association (each Wednesday) and Freddie Mac (each Thursday) averages are updated weekly.
30 Yr. Fixed 4.52% 0.50 +0.01
15 Yr. Fixed 3.97% 0.50 -0.01
1 Yr. ARM 2.68% 0.20 +0.01
5/1 Yr. ARM 3.85% 0.30 +0.03

Secondary Markets

MBS hdr_arrow.png
Price Change
30YR FNMA 3.0 96.64 -0.05
30YR FNMA 3.5 99.41 +0.05
30YR GNMA 3.0 97.81 +0.08
30YR GNMA 3.5 100.13 +0.03
15YR FNMA 3.0 99.39 +0.02
15YR FNMA 2.5 97.23 +0.05
Treasuries hdr_arrow.png
Yield Change
Current MBS / Treasury Prices »
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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2 YR 2.6290% -0.0243
5 YR 2.7382% -0.0135
10 YR 2.8604% +0.0018
30 YR 3.0191% +0.0120
Prices as of: 8/31/2018 5:05PM EST

23623981

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 and terms are subject to change without notice.
© 2018 Brown House Media, Inc. All rights reserved.
Brown House Media Inc. – 19706 One Norman Blvd – Cornelius, NC 28031
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Weekly Newsletter: Freddie’s New Product; Jumbo Back in Style; Lenders Back in Black; NAR Sees Cooling

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30 Year Fixed
4.65% -0.01
15 Year Fixed
4.15% -0.02
10YR Treasury
2.86% +0.0018
FNMA 30YR 3.5
99.41 +0.05
FNMA 15YR 2.5
99.39 +0.02
View Today’s Rates
Friday August 31, 2018
MND NewsWire – 8/30
Freddie Mac Updates Selling Guide, Introduces New Product
Freddie Mac will be consolidating two of its mortgage products into a single offering effective October 29, 2018. The company announced this and other changes to its Selling Guide in …
MND NewsWire – 8/31
Jumbo Loans Back in Style?
Taking out a mortgage with an origination balance higher than whatever the conventional loan limit was at the time used to be an expensive proposition. Home buyers and refinancers had …
MND NewsWire – 8/29
NAR Sees Overheated Housing Market Starting to Cool
Expectations weren’t particularly high for a solid July report on home purchase contracts, but today’s report from the National Association of Realtors® (NAR) didn’t meet even those …
MND NewsWire – 8/28
Consumers Want More Online Mortgage Features
The Fannie Mae’s National Housing Survey (NHS) polls a large panel of consumers monthly about their attitudes toward housing and related topics and generally reports on five or six …

Latest Video


Zillow: US won’t see a buyer’s market until 2020

Santelli Exchange: The yield curve as an indicator of future recessions

The health of the housing market

More News from ‘Around the Web’

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Today’s Rates

Best Execution hdr_arrow.png
Rate Change
Current Mortgage Rates »
What are best-execution rates?
30 Yr FRM 4.65% -0.01
15 Yr FRM 4.15% -0.02
FHA 30 Year Fixed 4.37% -0.01
Jumbo 30 Year Fixed 4.33% -0.02
5/1 Yr ARM 3.98% -0.01

Average Mortgage Rates

Rate Points Change
FHFA * hdr_arrow.png
15 Yr. Fixed 3.65% 1.14 +0.09
30 Yr. Fixed 4.19% 1.21 +0.02
MBA ** hdr_arrow.png
30 Yr. Fixed 4.68% 0.46 -0.01
15 Yr. Fixed 4.12% 0.51 +0.05
30 Yr. Jumbo 4.55% 0.37 +0.00
30 Yr. FHA 4.69% 0.81 -0.04
5/1 ARM 3.83% 0.68 -0.10
Freddie Mac ** hdr_arrow.png
Current Mortgage Rates »
* FHFA averages are updated monthly.
** Mortgage Bankers Association (each Wednesday) and Freddie Mac (each Thursday) averages are updated weekly.
30 Yr. Fixed 4.52% 0.50 +0.01
15 Yr. Fixed 3.97% 0.50 -0.01
1 Yr. ARM 2.68% 0.20 +0.01
5/1 Yr. ARM 3.85% 0.30 +0.03

Secondary Markets

MBS hdr_arrow.png
Price Change
30YR FNMA 3.0 96.64 -0.05
30YR FNMA 3.5 99.41 +0.05
30YR GNMA 3.0 97.81 +0.08
30YR GNMA 3.5 100.13 +0.03
15YR FNMA 3.0 99.39 +0.02
15YR FNMA 2.5 97.23 +0.05
Treasuries hdr_arrow.png
Yield Change
Current MBS / Treasury Prices »
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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2 YR 2.6290% -0.0243
5 YR 2.7382% -0.0135
10 YR 2.8604% +0.0018
30 YR 3.0191% +0.0120
Prices as of: 8/31/2018 5:05PM EST

23623981

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 and terms are subject to change without notice.
© 2018 Brown House Media, Inc. All rights reserved.
Brown House Media Inc. – 19706 One Norman Blvd – Cornelius, NC 28031
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Weekly Rate Report: Mortgage Rates Aren’t Really Moving

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weeklyrateheader.png
30 Year Fixed
4.65% -0.01
15 Year Fixed
4.15% -0.02
10YR Treasury
2.86% +0.0018
FNMA 30YR 3.5
99.41 +0.05
FNMA 15YR 2.5
99.39 +0.02
View Today’s Rates
Mortgage Rates Aren’t Really Moving
August 31, 2018
Market Summary
Mortgage rates caught a break to end a week that was otherwise spent moving higher. Lenders were ultimately able to offer modest improvements that got Friday’s levels back in line with Monday’s.

The catch is that Monday’s rates were still noticeably higher than those seen at the end of the previous week.

The other catch is that “rates” as we tend to think about them actually aren’t moving at all! Rather, it’s the upfront costs (or credits) tied to whatever rate you’re being quoted. These upfront costs allow for finer tuning than the typical .125% gap between mortgage rate offerings.

Monday is a bank holiday. Virtually every mortgage lender will be closed, and unable to process rate lock requests. Lenders will not be updating rate sheets until Tuesday.

-Matt Graham, Mortgage News Daily

30 Year Fixed Rate Mortgage
31?w=360
Week in Review
Rates shown below are based on the 30 Year Fixed Rate Mortgage

Beginning Average: 4.63%
Ending Average: 4.65%
Weekly Change: +0.02%
Yearly Change: +0.73%

Friday, August 24, 2018 : 4.63% (+0.01%)
Mortgage rates began the day slightly higher. In fact, for several lenders, it was the biggest day-over-day move higher in more than 2 weeks. The key word here is “was.” Things quickly changed in the mid-morning hours after Fed Chair Jerome Powell delivered his opening address at the Jackson Hole Symposium.

More detail: “Mortgage Rates Edge Higher, Then Lower”

Monday, August 27, 2018 : 4.63% (+0.00%)
Mortgage rates moved higher for some lenders and lower for others, depending on how that particular lender adjusted their rate sheets on Friday afternoon. While the bonds that underlie mortgage rates are moving constantly throughout the day, lenders want to see a certain amount of movement in any given direction before they go to the trouble of adjusting their mortgage rate offerings. Friday began with weaker bonds. Consequently the first mortgage rate sheets of the day were worse than Thursday’s (i.e. rates were higher). But bonds improved throughout the day–just enough for a handful of lenders to adjust rates lower.

More detail: “Mortgage Rates Higher (or Lower) Depending on Lender”

Tuesday, August 28, 2018 : 4.65% (+0.02%)
Mortgage rates rose again today–this time more noticeably than yesterday–bringing them to the highest levels in more than 2 weeks. For most, however, that sounds a lot worse than it actually is. In fact, the interest rate at the top of a loan quote has a good chance of being the exact same as the any other time during the past 2 weeks. How does that work?!

More detail: “Mortgage Rates Highest in More Than 2 Weeks”

Wednesday, August 29, 2018 : 4.66% (+0.01%)
Mortgage rates were just slightly higher again today, keeping them in line with the highest levels in about 3 weeks. The same caveat applies: we’re talking about “effective rates” (which factor in upfront lender costs) as opposed to “note rates” (the actual interest rate that most of us have in mind when discussing mortgage rates). In other words, most prospective borrowers are seeing the same old rate on any given day over the past 3 weeks, but the overall cost of financing, on average, would be highest today.

More detail: “Mortgage Rates Edge Higher Again”

Thursday, August 30, 2018 : 4.66% (+0.00%)
Mortgage rates didn’t move at all, again today. There really hasn’t been any meaningful movement for more than 3 weeks. The same thing happened from late June through mid July. And if we broaden our definition of “sideways” just a bit, we can legitimately fit most of 2018 into the same conversation. Just about the only thing that’s interesting about recent rate movement is that it continues to keep us generally closer to the highest levels in 7 years.

More detail: “Mortgage Rates: If You Like Boring, You're in Luck!”

Friday, August 31, 2018 : 4.65% (-0.01%)
Mortgage rates caught a break to end a week that was otherwise spent moving higher. Although we did see a bit of improvement in underlying bond markets yesterday, lenders were still getting rate sheets caught up with Wednesday afternoon’s bond market weakness. As such, we were left with a decent trading day but no improvement in rates.

More detail: “Mortgage Rates End Week Near Best Levels”

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Today’s Rates

Best Execution hdr_arrow.png
Rate Change
Current Mortgage Rates »
What are best-execution rates?
30 Yr FRM 4.65% -0.01
15 Yr FRM 4.15% -0.02
FHA 30 Year Fixed 4.37% -0.01
Jumbo 30 Year Fixed 4.33% -0.02
5/1 Yr ARM 3.98% -0.01

Average Mortgage Rates

Rate Points Change
FHFA * hdr_arrow.png
15 Yr. Fixed 3.65% 1.14 +0.09
30 Yr. Fixed 4.19% 1.21 +0.02
MBA ** hdr_arrow.png
30 Yr. Fixed 4.68% 0.46 -0.01
15 Yr. Fixed 4.12% 0.51 +0.05
30 Yr. Jumbo 4.55% 0.37 +0.00
30 Yr. FHA 4.69% 0.81 -0.04
5/1 ARM 3.83% 0.68 -0.10
Freddie Mac ** hdr_arrow.png
Current Mortgage Rates »
* FHFA averages are updated monthly.
** Mortgage Bankers Association (each Wednesday) and Freddie Mac (each Thursday) averages are updated weekly.
30 Yr. Fixed 4.52% 0.50 +0.01
15 Yr. Fixed 3.97% 0.50 -0.01
1 Yr. ARM 2.68% 0.20 +0.01
5/1 Yr. ARM 3.85% 0.30 +0.03

Secondary Markets

MBS hdr_arrow.png
Price Change
30YR FNMA 3.0 96.64 -0.05
30YR FNMA 3.5 99.41 +0.05
30YR GNMA 3.0 97.81 +0.08
30YR GNMA 3.5 100.13 +0.03
15YR FNMA 3.0 99.39 +0.02
15YR FNMA 2.5 97.23 +0.05
Treasuries hdr_arrow.png
Yield Change
Current MBS / Treasury Prices »
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
2 YR 2.6290% -0.0243
5 YR 2.7382% -0.0135
10 YR 2.8604% +0.0018
30 YR 3.0191% +0.0120
Prices as of: 8/31/2018 5:05PM EST

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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.

© 2018 Brown House Media, Inc. All rights reserved.
Brown House Media Inc. – 19706 One Norman Blvd – Cornelius, NC 28031

View this Report in your Web Browser | Forward to a Friend | Subscribe
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Daily Rate Update: Mortgage Rates End Week Near Best Levels

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dailyrateheader.png
30 Year Fixed
4.65% -0.01
15 Year Fixed
4.15% -0.02
10YR Treasury
2.86% +0.0018
FNMA 30YR 3.5
99.41 +0.05
FNMA 15YR 2.5
99.39 +0.02
View Today’s Rates
Mortgage Rates End Week Near Best Levels
August 31, 2018
Mortgage rates caught a break to end a week that was otherwise spent moving higher. Although we did see a bit of improvement in underlying bond markets yesterday, lenders were still getting rate sheets caught up with Wednesday afternoon’s bond market weakness. As such, we were left with a decent trading day but no improvement in rates.

In order to see that improvement, we needed this morning to bring stronger trading levels and that’s exactly what it did. Lenders were consequently able to offer token improvements in the upfront costs attached to the same old rate quotes that have prevailed for weeks.

In other words, bond markets aren’t moving enough for actual mortgage rates to change. Instead, movement is limited to the upfront costs (or credits) associated with any given loan–something that allows for finer tuning than the typical .125% gap between mortgage rate offerings.

Monday is a bank holiday. Virtually every mortgage lender will be closed, and unable to process rate lock requests. Lenders will not be updating rate sheets until Tuesday.

Loan Originator Perspective

Bonds posted small gains today, as market participants headed for the exits early. September brings the potential for greater rate volatility, the trend (if any) is still not our friend. I’m locking new loans closing within 45 days. Happy Labor Day weekend, all. –Ted Rood, Senior Originator

Today’s Most Prevalent Rates

  • 30YR FIXED – 4.625-4.75
  • FHA/VA – 4.25-4.5%
  • 15 YEAR FIXED – 4.125%
  • 5 YEAR ARMS – 3.75-4.25% depending on the lender


Ongoing Lock/Float Considerations

  • Rates moved higher in a serious way due to several big-picture headwinds, including: the Fed’s rate hike outlook (and general policy tightening), the increased amount of Treasury issuance to pay for the tax bill (higher bond issuance = higher rates), and the possibility that fiscal stimulus results in higher growth/inflation.
  • Despite those headwinds, the upward momentum in rates has cooled off heading into the summer months. This could merely be the eye of the storm, or it could end up being the moment where markets began to doubt that prevailing trends would continue.
  • It makes sense to remain defensive (i.e. generally more lock-biased) because the headwinds mentioned above won’t die down quickly. Temporary corrections can be explained away, but it will take a big change in economic fundamentals or geopolitical risk for the big picture to change. While that doesn’t necessarily mean rates have to skyrocket, there’s a good chance it means rates will struggle to move much lower than early 2018 lows until more convincing motivation shows up.
  • Rates discussed refer to the most frequently-quoted, conforming, conventional 30yr fixed rate for top tier borrowers among average to well-priced lenders. The rates generally assume little-to-no origination or discount except as noted when applicable. Rates appearing on this page are “effective rates” that take day-to-day changes in upfront costs into consideration.

30 Year Fixed Rate Mortgage
31?w=360
15 Year Fixed Rate Mortgage
31?w=360&p=15YRFRM

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Enable co-branding to personalize this report with your business information here. Learn more about co-branding with NO competitor ads.

Today’s Rates

Best Execution hdr_arrow.png
Rate Change
Current Mortgage Rates »
What are best-execution rates?
30 Yr FRM 4.65% -0.01
15 Yr FRM 4.15% -0.02
FHA 30 Year Fixed 4.37% -0.01
Jumbo 30 Year Fixed 4.33% -0.02
5/1 Yr ARM 3.98% -0.01

Average Mortgage Rates

Rate Points Change
FHFA * hdr_arrow.png
15 Yr. Fixed 3.65% 1.14 +0.09
30 Yr. Fixed 4.19% 1.21 +0.02
MBA ** hdr_arrow.png
30 Yr. Fixed 4.68% 0.46 -0.01
15 Yr. Fixed 4.12% 0.51 +0.05
30 Yr. Jumbo 4.55% 0.37 +0.00
30 Yr. FHA 4.69% 0.81 -0.04
5/1 ARM 3.83% 0.68 -0.10
Freddie Mac ** hdr_arrow.png
Current Mortgage Rates »
* FHFA averages are updated monthly.
** Mortgage Bankers Association (each Wednesday) and Freddie Mac (each Thursday) averages are updated weekly.
30 Yr. Fixed 4.52% 0.50 +0.01
15 Yr. Fixed 3.97% 0.50 -0.01
1 Yr. ARM 2.68% 0.20 +0.01
5/1 Yr. ARM 3.85% 0.30 +0.03

Secondary Markets

MBS hdr_arrow.png
Price Change
30YR FNMA 3.0 96.64 -0.05
30YR FNMA 3.5 99.41 +0.05
30YR GNMA 3.0 97.81 +0.08
30YR GNMA 3.5 100.13 +0.03
15YR FNMA 3.0 99.39 +0.02
15YR FNMA 2.5 97.23 +0.05
Treasuries hdr_arrow.png
Yield Change
Current MBS / Treasury Prices »
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
2 YR 2.6290% -0.0243
5 YR 2.7382% -0.0135
10 YR 2.8604% +0.0018
30 YR 3.0191% +0.0120
Prices as of: 8/31/2018 5:05PM EST

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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.
© 2018 Brown House Media, Inc. All rights reserved.
Brown House Media Inc. – 19706 One Norman Blvd – Cornelius, NC 28031
View this Report in your Web Browser | Forward to a Friend | Subscribe
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.
You were sent this email because you opted to receive our weekly or daily email reports. Go here to manage your email preferences or here to unsubscribe from all email communications.

HomeReady: Several Big Advantages Over FHA

HomeReady: Several Big Advantages Over FHA

Posted to: MND NewsWire
Thursday, August 30, 2018 3:58 PM

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Fannie Mae’s 3% down payment HomeReady program was rolled out in 2016. HomeReady has numerous advantages over FHA loans (historically the most common “low down payment” option) and other conventional loans. We’ll compare them in this series. Today, let’s look at mortgage insurance costs:

No upfront mortgage insurance premium: While both HomeReady and FHA have low down payments (3% for HomeReady, 3.5% for FHA), FHA loans add an upfront mortgage insurance premium (UFMIP) of 1.75% of the amount borrowed to…

(READ THE FULL POST)

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Jumbo Loans Back in Style?

Jumbo Loans Back in Style?

Posted to: MND NewsWire
Friday, August 31, 2018 10:39 AM

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Taking out a mortgage with an origination balance higher than whatever the conventional loan limit was at the time used to be an expensive proposition. Home buyers and refinancers had an incentive to do whatever they could – higher down payments, piggy back second mortgages – to get their loan under that conventional limit in order to reap the benefits of lower borrowing costs. However, as Archana Prahan writes in the CoreLogic Insights Blog, since mid-2013 a jumbo loan has had lower borrower costs than a conforming loan, currently defined as one with a balance at or under $453,100.

(READ THE FULL POST)

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