Since 8:40am yesterday morning, bond markets have been exceptionally calm compared to past examples of decently sized moves following the monthly jobs report. It's almost as if the data was worth a certain amount of adjustment to trading levels, the adjustment was priced in quickly, and not much has happened since then. That said, there was definitely a positive tilt to today's price action with MBS starting the day in stronger territory and generally moving higher until 2pm. The selling since then increasingly looks like a modest correction rather than any sort of abrupt reversal. The default trend remains modestly bullish, and waiting for additional economic data to flesh out the bigger picture mostly already drawn by NFP.
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 Potential Increasing; No Long Term Implications
There has been some moderate selling pressure this afternoon beginning just after 2pm. 10's are 2.5bps higher from their best levels of the day and MBS are off their highs by 7 ticks. For many lenders, this won't be enough of a change in tone to justify negative reprices, but a few could be considering it.Bottom line: this is incidental afternoon weakness with uncertain reprice implications. There was little risk before. There is some risk now. If we were committed to floating in the longer run, this wouldn't be the kind of selling pressure that forced us to lock, but if we were looking for an opportunity to lock today, this would be as good as any.
Ongoing Positive Reprice Potential as MBS Push Highs
MBS and Treasuries have both been pushing the boundaries of their best levels today. After an earlier bounce in the mid 2.47's, 10's returned for a run to 2.471 in the "black-box-heavy" 2pm hour.
Activity remains extraordinarily light for a day that's seen the best levels in 3 months (4 months for MBS), but the rally is every bit as steady as yesterday afternoon's.
That's been good for the reprice environment so far today. If you haven't seen one yet, it remains possible. Fannie 3.5s are up 10 ticks on the day now at 102-28. 10yr yields are at 2.475 after bouncing at 2.471 at 2pm.
Live Chat Featured Comments
Nate Miller : "fyi regarding the MI question from earlier, this is from radians customer service for what it's worth: Radian does not have any minimum requirements or minimum amount of time as to the length of time that a borrower must keep MI. However, some lenders and investors may have minimum requirements and minimum time frames as to when MI can be cancelled. Thank you. "
Matt Hodges : "the 9.1 release notes say 45%, with 50% possible"
Rob Clark : "REPRICE: 12:32 PM - Provident Funding Better"
Matt Hodges : "reserves, good fico"
Matt Hodges : "30 year and 7/1"
Tom Bartlett : "wow- was that with huge reserves MH? and Fannie or Freddie?"
Jason Anker : "48 very recent"
Matt Hodges : "49.9"
Tom Bartlett : "good morning-what is the highest DTI you guys are seeing on FNMA or freddie recently?"
Nate Miller : "REPRICE: 12:14 PM - Flagstar Better"
Nate Miller : "REPRICE: 12:13 PM - Franklin American Better"
Nate Miller : "REPRICE: 12:13 PM - Homeward Residential Better"
Rob Clark : "Fidelity Commercial Funding has a nationwide multi family program. 714-908-5100"
Rob Clark : "REPRICE: 12:08 PM - Interbank Better"
Nate Miller : "Provident Bank (not PF) in CA only,,,what state?"
Drexel Hill Mortgage, Inc. : "anyone know of anyone that can do a 8 unit investment prop? "
edksullivan : "MI agreements typically say "History of regular, on-time payment' which I've always been told is 24 month history"
Jason Anker : "paydown can remove in less than 2 years, I agree, stand corrected. "
Ross Miller : "The Homeowners protection act of 1998 requires the following: It requires that PMI be automatically terminated once that equity rises to 22 percent. http://www.in.gov/dfi/pmi.pdf but I do agree that this is for owner occupied single family only."
joon choi : "check your mi agreement"
Jason Anker : "if anyone has a less than 24 months MI removal lender I'd like to know who, all of mine are 24."