MBS Live: MBS Afternoon Market Summary
Monday got off to an uneventful start as overnight markets were exceptionally calm.  MBS opened flat and added a few ticks in the morning hours.  Things leveled off into the PM hours but never to the point of threatening the day-over-day gains.  Fannie 4.0s--the most relevant coupon for most 30yr fixed production at the moment--added just less than an eighth of a point while 10yr Treasury yields dropped 3.6bps. 

There were no significant economic reports and the three Fed speakers were fairly predictable.  Despite the moderate gains, the driving forces seem to be more sideways today with a combination of low volume and tradeflow considerations conspiring to convey slightly more strength than we might otherwise be seeing. 

NOTE: Fannie and Freddie 30yr Fixed MBS "roll" from December to January coupons tonight.  Because the displayed prices always draw from the most current month (in this case, December), and because January prices trade 8-12 ticks lower than December, prices will look like they've dropped an extra 8-12 ticks tomorrow when we move to the January coupons. 

MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
FNMA 3.0
95-25 : +0-06
FNMA 3.5
100-08 : +0-06
FNMA 4.0
103-28 : +0-03
FNMA 4.5
106-23 : +0-00
GNMA 3.0
96-29 : +0-03
GNMA 3.5
101-11 : +0-05
GNMA 4.0
104-21 : +0-04
GNMA 4.5
107-06 : -0-04
FHLMC 3.0
95-12 : +0-07
FHLMC 3.5
100-02 : +0-07
FHLMC 4.0
103-20 : +0-05
FHLMC 4.5
106-12 : -0-02
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 this afternoon.
3:00PM  :  Slight Pressure Building Into Afternoon; Reprice Risk at Bay
Just a heads up that we're 4 ticks off the highs of the day in Fannie 4.0s, though only 2-3 ticks off rate sheet print time levels depending on the lender. That almost certainly precludes any price-based reprice risk unless we were to see another 2-3 ticks of weakness.

Treasuries and MBS turned the corner together right after 12:30pm. The day's second round of Fed Treasury buying gave way to a bit of volatility heading into 2pm, and 10yr yields broke over 2.85. After a quick bounce, they've back up to 2.855 currently and Fannie 4.0s are down to 102-27 (still 2 ticks into positive territory on the day).

Markets may be starting to think about Treasury supply coming up during the next three days and if 10yr yields break their highs, it could be one of those situations where MBS quickly follow. 10's are RIGHT THERE at the moment, so things could change quickly if yields rise any more.
Live Chat Featured Comments
A recap of the featured comments from the MBS Live Dashboard's Live Chat feature, utilized by hundreds of industry professionals each day.
Jason York  :  "As a general rule, FHA is not concerned with how a donor obtains gift funds, provided that the funds are not derived in any manner from a party to the sales transaction. Donors may borrow gift funds from any other acceptable source, provided the mortgage borrowers are not obligors to any note to secure money borrowed to give the gift."
Ben Biscoe  :  "northern VA and DC metro area got dropped to 625,500"
Jason York  :  "should just have to show a cleared check from the account it was written from, and show it was deposited in the buyer's account"
Curt Sandfort  :  "FHA still requires donors "ability" with copy of bank statement?"
Clayton Sandy  :  "We are currently at $729k in Salt Lake County. Going down to $300k...how does that even make sense?"
Ted Rood  :  "I don't even want to think about the MIP costs for a 700K FHA loan."
Jason Anker  :  "ah I see. One of my countires was 385 and now 285 and needs 385. Boo on FHA. "
Matthew Graham  :  " Clayton Sandy (12/8/13 11:06PM): I've got 5 borrowers right now that will be affected by it. Salt Lake County goes from $729K to $300?? How does that make any sense? I'll have to order case numbers and hope they don't cancel them before the homes are complete "
Jason Anker  :  "anyone in a market where FHA loan limits are going down 100k+? "
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