Afternoon trading was similar to morning trading for Treasuries, combining for an entire session of gradual losses in a decreasing range of volatility. MBS did a good enough job fighting off that negativity until the noon hour when the downtrend in price wrested control from the potential uptrend counter-currents, leaving MBS to coast gently lower into the close. The entirety of today's action took place inside yesterday's range of prices, with a good bit of cushion on either side. Uneventful to say the least.
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing
is available via MBS Live.
Pricing as of 4:05 PM EST
Afternoon Reprice Alerts and Updates
Below is a recap of instant Reprice Alerts
and updates issued via email and text alert to MBS Live subscribers
Negative Reprice Risk Picking Up As Leakage Continues
Earlier unresolved competing trends in MBS now look to be favoring the downtrends as sideways support levels in Fannie 3.0's and 3.5's are breaking down, even if less than definitively. 10yr yields finally broke through their highs of the day (also less than definitively) after threatening to do so for several hours now.
The moves are small in the big picture, but relative to the well-contained day, do create some slightly increased risks for negative reprices. The bottom line is that MBS are at their lows of the day, but in very narrow ranges. Not time to panic in general, but may be a good opportunity to lock if you were thinking about doing so today.
Overall Market Dynamics Largely Similar To This AM, MBS Hangin' Tough
Very little has changed from this morning as Treasuries continue to grind into weak-side support levels (around 1.67 in 10's) and MBS continue to try holding on to 104-29 and 102-11 as support levels in Fannie 3.5s and Fannie 3.0's currently. So far this afternoon, all of those support levels continue to hold and trading ranges have narrowed from already narrow opening levels.
The afternoon looks a bit less certain and feels a bit more vulnerable to some old-fashioned Friday afternoon leakage. We highlighted a few trendlines on Fannie 3.5's, 3.0's, and 10yr Treasuries to serve as sort of guideposts as to how things might transpire.
We've seen one negative reprice from a "usual suspect" but we don't quite see the current level of weakness as justifying that (just like we didn't see the previous level of strength justifying their earlier positive reprice). So said "usual suspect" merely returns to equilibrium while the rest of the market continues to do nothing.
Any changes to that outlook are likely to occur in low volume and be purely incidental and not at all indicative of the week ahead, unless otherwise noted. Bottom line, reprice risk is minimal but could arise positively or negatively according to how the aforementioned technical levels hold up. Very slow and uneventful otherwise and next week is a new week (with limited data, Treasury supply, and more Euro Summit meetings).
Live Chat Featured Comments
Tim McNerney : "REPRICE: 1:46 PM - Provident Funding Worse"
Chip Harris : "Most of my lenders, especially those priced agressively can't move that fast any longer."
Victor Burek : "still very good"
Chip Harris : "Anyone using SunWest. Smoking pricing and I have two FHA deals that are closing today theat were submitted on 6/6 and 6/7."
Matthew Graham : "yeah, in the big picture, I don't think there has been any stretch of 30 day's where you couldn't get better pricing at some point during that 30 day period than on the first day one."
Victor Burek : "but recently..havent lock any for 30 or longer"
Victor Burek : "i lock all the time"
Jason Zimmer : "never heard Vic say lock before"
Victor Burek : "my advice is if within 15 lock..if closing over 15 float"
Matthew Graham : "need to update this for modern times, but largely still applies: http://www.mortgagenewsdaily.com/mortgage_rates/blog/49123.aspx"
EB : "so do we lock or float into the weekend? i think it is apparant who i am rooting for."
Matthew Graham : "I guess Samaras won't be there, so no cage match unfortunately "
Matthew Graham : "just depends on how Merkel is acting in the stadium. I'd imagine if she's attacked by an angry mob of Greeks, it won't be good for Greece's financial situation."
EB : "MG, what is your take on the outcome of the germany vs. greece soccer game on the european market. if lightening happens to strike and greece defeats germany, does germany cut off all financial support to greece and basically doom the entire country?"
Matthew Graham : "there's sort of a pivot "zone" between 1.66 and 1.7. I'll put up a chart in a bit, or you can likely see it in advanced charts as well"
Victor Burek : "sorry..just read update..1.69"
Rob Clark : "REPRICE: 12:24 PM - Provident Funding Better"
Victor Burek : "mg...1.67 support on the 10yr?"
MC : "not all judgements can attach to title. "
Michael Gannon : "it will become a judgment and then a lien....why wouldnt it? "
Andrew Russell : "I dont agree with much that FHA does allow, though, but it is what it is...technically it is allowed. "
Andrew Russell : "Call the wells scenario help line and ask. Why would that become a lien on title? It wasnt present on the title search for liens and judgments. "
Michael Gannon : "are you putting it through your Ginnie? I dont know of an investor that will let that fly.....and that 42k will most likely become a lien on title at some point. Cant say I agree with the thinking on that one, but to each his own"
Andrew Russell : "as long as it isnt housing, student loans, or medical you can have an open collection, investors have their own overlays though"
Andrew Russell : "and they rescinded the mortgagee letter where they required it being paid off"
Andrew Russell : "MG, we are letting a 42k collection fly"
Mike Ford : "think chase will subordinate 150%cltv for my open access with HVE in lieu of appraisal? never had a sub denied for harp, but never this high cltv!"
Brayden Alexander : "do not run DU on as streamline. Itll convert to standard FHA"
Michael Gannon : "i dont know an investor that is going to let a 2800 collection fly....DU/LP or no DU/LP....and doesnt FHA make you pay it off?"
Matthew Graham : "RTRS - GERMANY'S SCHAEUBLE SAYS NO ROOM FOR MANOUEVRE ON GOAL OF CUTTING DEBT TO 120 PCT OF GDP FOR GREECE "
Matthew Graham : "RTRS - GERMANY'S SCHAEUBLE SAYS GREECE MUST FULFILL CONDITIONS OF ITS AID PROGRAMME "
Andrew Russell : "if du or lp doesnt ask for it to be paid, then no"
Andrew Russell : "what type"
Jason Adams : "FHA Streamline.. has a collection, do we or do we not have to pay it off now? collection is 2800.00"