MBS Day Ahead: Clearly Defined Floor and Ceiling For Now

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Posted to: MBS Commentary
Friday, August 30, 2019 9:18 AM

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In the day just passed, the Treasury complex came under pressure on several fronts. Trade related headlines sapped some of the safe haven demand, as did political progress in Italy. Europe continued to have an influence into domestic hours after an ECB member commented on the market’s overblown expectations for a September rate cut and additional stimulus. Finally, a poorly received 7yr Treasury auction underscored the need for bonds to tap the brakes this week.

In the day ahead, we will keep a close eye on the levels that have coincided with bonds tapping the brakes…

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More from MND:

• Pipeline Press: DPA, Broker, Customer-Centric products; Tech Survey Results
• MND NewsWire: Banks Report Huge Improvement in Mortgage Profitability
• MND NewsWire: Lower Rates Increased Affordability in July
• MND NewsWire: Freddie Says Housing Will Help to Stop Recession, Here’s How
• MBS Commentary: MBS RECAP: Today Was a Victory for MBS. We’ll Take It!

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DPA, Broker, Customer-Centric products; Tech Survey Results

Posted to: Pipeline Press
Friday, August 30, 2019 8:23 AM

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As Floridians watch “Storm Porn,” as the weather channel is called, Tennessee is buzzing about this Nashville Realtor’s marketing. (Warning: Rated a solid R.) The rest of the nation is more interested in the economy, and how one of the highest rates in the world is our own overnight Fed Funds rate! Don’t forget the economist’s saying, “Either say what will happen or when something will happen, but never the two together.” Fannie Mae now forecasts full-year 2019 mortgage origination headline growth to be up slightly to 2.2 percent, despite a shortage of homes for sale and the escalating trade conflict. The Fannie Mae Economic and Strategic Research Group also expects two more quarter-point interest rate cuts by the Federal Reserve in 2019, one in September and another in December, based on strong consumer spending, a surge in government nondefense spending, slowing residential fixed investment, and a negative business investment due to increasing trade and geopolitical uncertainty. More in the capital markets section below.

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More from MND:

• MND NewsWire: Banks Report Huge Improvement in Mortgage Profitability
• MND NewsWire: Lower Rates Increased Affordability in July
• MND NewsWire: Freddie Says Housing Will Help to Stop Recession, Here’s How
• MBS Commentary: MBS RECAP: Today Was a Victory for MBS. We’ll Take It!
• Mortgage Rate Watch: Yes, Mortgage Rates are Lower and 10yr Yields are Higher Today

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Banks Report Huge Improvement in Mortgage Profitability

Posted to: MND NewsWire
Friday, August 30, 2019 8:22 AM

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There was a dramatic turnaround for many mortgage banks in the second quarter as their production profits increased nearly six-fold compared to the previous period. The Mortgage Bankers Association (MBA) said the independent mortgage banks (IMBs) and mortgage subsidiaries of chartered banks responding to their survey said they had an average net gain of $1,675 on each loan they originated, up from a reported gain of $285 per loan in the first quarter of 2019. Including all business lines (both production and servicing), 85 percent of the firms in the study posted pre-tax net financial profits for the quarter. Only 59 percent did so in the first quarter.

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More from MND:

• MND NewsWire: Lower Rates Increased Affordability in July
• MND NewsWire: Freddie Says Housing Will Help to Stop Recession, Here’s How
• MBS Commentary: MBS RECAP: Today Was a Victory for MBS. We’ll Take It!
• Mortgage Rate Watch: Yes, Mortgage Rates are Lower and 10yr Yields are Higher Today
• MND NewsWire: Pending Home Sales Winning Streak Leveled-Off in July

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Lower Rates Increased Affordability in July

Posted to: MND NewsWire
Thursday, August 29, 2019 1:14 PM

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At least one housing index is seeing a turn-around in the direction of home prices. Black Knight says the continuing decline of interest rates have increased homebuying affordability. As a result, its ended 16 straight months of decelerating appreciation in July. The company’s Home Price Index (HPI) increased 0.34 percent for the month, bringing year-over-year growth to 3.9 percent. Over the preceding 16 months the annual growth rate had slowed from a peak of 6.75 percent in February 2018 to 3.7 percent in June. While the rate of appreciation slowed over that 15-month period, prices continued to rise and in July marked 87 consecutive months of annual increases.

(READ THE FULL POST)

More from MND:

• MND NewsWire: Freddie Says Housing Will Help to Stop Recession, Here’s How
• MBS Commentary: MBS RECAP: Today Was a Victory for MBS. We’ll Take It!
• Mortgage Rate Watch: Yes, Mortgage Rates are Lower and 10yr Yields are Higher Today
• MND NewsWire: Pending Home Sales Winning Streak Leveled-Off in July
• MBS Commentary: MBS Day Ahead: "Fun" With Chart Scaling: MBS vs Treasuries

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Freddie Says Housing Will Help to Stop Recession, Here’s How

Posted to: MND NewsWire
Thursday, August 29, 2019 12:22 PM

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Housing led the way into the last recession, now Freddie Mac’s economists are suggesting it might help stave off the next one or at least modify its severity. In its August Forecast, the company says a deteriorating global economy and on-going US trade disputes with multiple countries has led to a drop in long-term interest rates to a three-year low and has “poised housing to reaccelerate.” The report says to expect a significant increase in refinance originations and the combination of low rates, a tight labor market and strong consumer confidence to offset declining business sentiment. “These factors will set the stage for continued improvement in the housing market heading into the fall.”

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More from MND:

• MBS Commentary: MBS RECAP: Today Was a Victory for MBS. We’ll Take It!
• Mortgage Rate Watch: Yes, Mortgage Rates are Lower and 10yr Yields are Higher Today
• MND NewsWire: Pending Home Sales Winning Streak Leveled-Off in July
• MBS Commentary: MBS Day Ahead: "Fun" With Chart Scaling: MBS vs Treasuries
• Pipeline Press: Warehouse Product; Shifts in FHA, VA, HUD, and Ginnie Policies

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MBS RECAP: Today Was a Victory for MBS. We’ll Take It!

Before you read it here, it was on MBS Live.

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Posted to: MBS Commentary
Thursday, August 29, 2019 4:57 PM

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Bonds were weaker overnight in response to upbeat trade headlines from China’s commerce minister as well as Italian political news (read the MBS Live update). The morning’s economic data passed without a trace, not that we would expect too much from a GDP revision or yet another Jobless Claims reading around 215k. Things didn’t pick up until the 9:30am NYSE open, which has been a focal point for morning volatility this week. This time around, it pushed bond yields higher. MBS followed with modest weakness, but not at the same pace as Treasuries.

Thus began…

(READ THE FULL POST)

More from MND:

• Mortgage Rate Watch: Yes, Mortgage Rates are Lower and 10yr Yields are Higher Today
• MND NewsWire: Pending Home Sales Winning Streak Leveled-Off in July
• MBS Commentary: MBS Day Ahead: "Fun" With Chart Scaling: MBS vs Treasuries
• Pipeline Press: Warehouse Product; Shifts in FHA, VA, HUD, and Ginnie Policies
• MND NewsWire: Uptick in Housing Inventories May be Short-Lived

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Daily Newsletter: Mortgage Rates Lower; 10yr Yields Higher; Sales Streak Paused

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30 Year Fixed 3.56% -0.03 15 Year Fixed 3.25% -0.03 10YR Treasury 1.50% +0.0319 FNMA 30YR 3.5 102.69 -0.02 FNMA 15YR 2.5 102.45 -0.06 View Today’s Rates

Thursday August 29, 2019 Mortgage Rate Watch – 4:12PM Yes, Mortgage Rates are Lower and 10yr Yields are Higher Today Two days ago, I wrote an article entitled ” No, Mortgage Rates Aren’t Based on 10yr Treasury Yields .” It’s worth a read if you’re not already up to speed on why that’s a true statement … MND NewsWire – 10:26AM Pending Home Sales Winning Streak Leveled-Off in July Pending home sales moved lower in July, declining by 2.5 percent. After two consecutive months of gains the National Association of Realtors’® (NAR’s) Pending Home Sales Index … MND NewsWire – 8:26AM Uptick in Housing Inventories May be Short-Lived The theme of every sales and price report for the last several years has been the shortage of homes for sale. While new home inventories have held steady over the six-month supply considered … MBS Day Ahead: "Fun" With Chart Scaling: MBS vs Treasuries Warehouse Product; Shifts in FHA, VA, HUD, and Ginnie Policies Latest Video Former Fed board governor breaks down the Fed’s dilemma Why Art Cashin says the inverted yield curve is ‘suspect’ Q2 GDP revised to 2.0% on second read, jobless claims rise to 215,000 Today’s Rates Best Execution Rate Change Current Mortgage Rates » What are best-execution rates? 30 Yr FRM 3.56% -0.03 15 Yr FRM 3.25% -0.03 FHA 30 Year Fixed 3.25% -0.04 Jumbo 30 Year Fixed 3.69% -0.03 5/1 Yr ARM 3.38% -0.02 Average Mortgage Rates Rate Points Change FHFA * 15 Yr. Fixed 3.79% 1.21 -0.12 30 Yr. Fixed 4.39% 1.12 -0.22 MBA ** 30 Yr. Fixed 4.12% 0.38 +0.08 15 Yr. Fixed 3.48% 0.32 +0.06 30 Yr. Jumbo 4.07% 0.21 +0.04 30 Yr. FHA 4.01% 0.28 +0.04 5/1 ARM 3.58% 0.27 +0.02 Freddie Mac ** 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 3.58% 0.50 +0.03 15 Yr. Fixed 3.06% 0.50 +0.03 1 Yr. ARM 2.68% 0.20 +0.01 5/1 Yr. ARM 3.31% 0.40 -0.01 Secondary Markets MBS Price Change 30YR FNMA 3.0 101.81 -0.03 30YR FNMA 3.5 102.69 -0.02 30YR GNMA 3.0 103.08 +0.08 30YR GNMA 3.5 103.97 +0.08 15YR FNMA 3.0 102.45 -0.06 15YR FNMA 2.5 101.23 -0.06 Treasuries 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 1.5220% +0.0220 5 YR 1.3996% +0.0253 10 YR 1.4996% +0.0319 30 YR 1.9653% +0.0272 Prices as of: 8/29/2019 5:00PM EST

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. © 2019 Brown House Media, Inc. All rights reserved. Brown House Media Inc. – 19706 One Norman Blvd – Cornelius, NC 28031

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Daily Rate Update: Yes, Mortgage Rates are Lower and 10yr Yields are Higher Today

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30 Year Fixed 3.56% -0.03 15 Year Fixed 3.25% -0.03 10YR Treasury 1.50% +0.0319 FNMA 30YR 3.5 102.67 -0.03 FNMA 15YR 2.5 102.45 -0.06 View Today’s Rates

Yes, Mortgage Rates are Lower and 10yr Yields are Higher Today August 29, 2019 Two days ago, I wrote an article entitled “No, Mortgage Rates Aren’t Based on 10yr Treasury Yields.” It’s worth a read if you’re not already up to speed on why that’s a true statement. It also paves the way to understand why today’s headline can be true (and in fact, it is). Mortgage rates moved LOWER today. Granted, it wasn’t a huge move lower, but it’s notable against the backdrop of 10yr Treasury yields that were more than 0.06% higher at one point. Much of the discussion regarding mortgages vs Treasuries centers on MBS (the mortgage-backed securities that serve as the base ingredient for mortgage rates) and the fact that they don’t always move in the same direction as Treasuries. But that’s only part of today’s divergence. We often talk about TIMING being responsible for smaller examples of such discrepancies and it’s a factor again today. Simply put, MBS improved yesterday. The gains were eventually enough for lenders to bring rates a bit lower, but not quite enough for lenders to go to the trouble of making a mid-day rate sheet adjustment. In those cases, we cross our fingers and hope the market opens in similar territory the following day (as it did today!) so lenders can pass along the expected improvement. Loan Originator Perspective Bond markets digested on target GDP data and a weak treasury auction today, trending downward in afternoon trading. MBS escaped the brunt of the losses, and my pricing was similar to Wednesday’s. Tomorrow promises to be a slow day as attentions turn to Dorian and the Labor Day weekend. I’m locking September closings. – Ted Rood, Senior Originator Today’s Most Prevalent Rates 30YR FIXED – 3.5 – 3.625% FHA/VA – 3.25-3.5% 15 YEAR FIXED – 3.125 – 3.375% 5 YEAR ARMS – 3.375-3.75% depending on the lender Ongoing Lock/Float Considerations 2019 has been the best year for mortgage rates since 2011. Big, long-lasting improvements such as this one are increasingly susceptible to bounces/corrections. Fed policy and the US/China trade war have been key players The Fed and the bond market (which dictates rates) will be watching economic data closely, both at home and abroad, as well as trade war updates. The stronger the data and trade relations, the more rates could rise, while weaker data and trade wars will lead to new long-term lows. 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 15 Year Fixed Rate Mortgage Co-branding this Report 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 Rate Change Current Mortgage Rates » What are best-execution rates? 30 Yr FRM 3.56% -0.03 15 Yr FRM 3.25% -0.03 FHA 30 Year Fixed 3.25% -0.04 Jumbo 30 Year Fixed 3.69% -0.03 5/1 Yr ARM 3.38% -0.02 Average Mortgage Rates Rate Points Change FHFA * 15 Yr. Fixed 3.79% 1.21 -0.12 30 Yr. Fixed 4.39% 1.12 -0.22 MBA ** 30 Yr. Fixed 4.12% 0.38 +0.08 15 Yr. Fixed 3.48% 0.32 +0.06 30 Yr. Jumbo 4.07% 0.21 +0.04 30 Yr. FHA 4.01% 0.28 +0.04 5/1 ARM 3.58% 0.27 +0.02 Freddie Mac ** 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 3.58% 0.50 +0.03 15 Yr. Fixed 3.06% 0.50 +0.03 1 Yr. ARM 2.68% 0.20 +0.01 5/1 Yr. ARM 3.31% 0.40 -0.01 Secondary Markets MBS Price Change 30YR FNMA 3.0 101.78 -0.06 30YR FNMA 3.5 102.67 -0.03 30YR GNMA 3.0 103.08 +0.08 30YR GNMA 3.5 103.95 +0.06 15YR FNMA 3.0 102.45 -0.06 15YR FNMA 2.5 101.23 -0.06 Treasuries 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 1.5280% +0.0280 5 YR 1.3996% +0.0253 10 YR 1.4996% +0.0319 30 YR 1.9653% +0.0272 Prices as of: 8/29/2019 4:56PM EST

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.

© 2019 Brown House Media, Inc. All rights reserved. Brown House Media Inc. – 19706 One Norman Blvd – Cornelius, NC 28031

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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. 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.

Pending Home Sales Winning Streak Leveled-Off in July

Posted to: MND NewsWire
Thursday, August 29, 2019 9:56 AM

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Pending home sales moved lower in July, declining by 2.5 percent. After two consecutive months of gains the National Association of Realtors’® (NAR’s) Pending Home Sales Index (PHSI), a leading indicator of existing home sales, was expected to decline, but the drop from the June level of 108.3 to 105.6 was greater than expected. The PHSI, based on new contracts for existing home purchases, is now down 0.3 percent on a year-over-year basis. NAR said the downturn was seen in all four regions, with the greatest impact in the West. Analysts polled by Econoday forecast the index would dip by 0.3 percent. The range of estimates was -1.0 percent to 0.5 percent.

(READ THE FULL POST)

More from MND:

• MBS Commentary: MBS Day Ahead: "Fun" With Chart Scaling: MBS vs Treasuries
• Pipeline Press: Warehouse Product; Shifts in FHA, VA, HUD, and Ginnie Policies
• MND NewsWire: Uptick in Housing Inventories May be Short-Lived
• MBS Commentary: MBS RECAP: MBS Prove They At Least Remember How to Outperform
• Mortgage Rate Watch: Mortgage Rates Back in Line With 3 Year Lows

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MBS Day Ahead: “Fun” With Chart Scaling: MBS vs Treasuries

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Posted to: MBS Commentary
Thursday, August 29, 2019 9:37 AM

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Yesterday was one of the most boring trading sessions in recent memory. There were no meaningful market movers to discuss for the Treasury complex. And the only potential market movers proved to be almost meaningless. These included a tariff headline that simply referenced the implementation of a tariff change that was already announced and understood as well as the 5yr Treasury auction. As far as the bond market was concerned, bot of those events were forgettable (i.e. whatever movement they created was quickly erased).

MBS couldn’t have been happier …

(READ THE FULL POST)

More from MND:

• Pipeline Press: Warehouse Product; Shifts in FHA, VA, HUD, and Ginnie Policies
• MND NewsWire: Uptick in Housing Inventories May be Short-Lived
• MBS Commentary: MBS RECAP: MBS Prove They At Least Remember How to Outperform
• Mortgage Rate Watch: Mortgage Rates Back in Line With 3 Year Lows
• MND NewsWire: Homeownership is the Top Contributor to Household Wealth

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