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  • A Look at Mortgage-Backed Securities Trends

    first_img Data Provider Black Knight to Acquire Top of Mind 2 days ago  Print This Post May 9, 2019 4,260 Views Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Seth Welborn is a Reporter for DS News and MReport. A graduate of Harding University, he has covered numerous topics across the real estate and default servicing industries. Additionally, he has written B2B marketing copy for Dallas-based companies such as AT&T. An East Texas Native, he also works part-time as a photographer. Data Provider Black Knight to Acquire Top of Mind 2 days ago Home / Daily Dose / A Look at Mortgage-Backed Securities Trends Related Articles Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Subscribe Demand Propels Home Prices Upward 2 days ago Sign up for DS News Daily Share Save Servicers Navigate the Post-Pandemic World 2 days agocenter_img According to the Bloomberg Barclays U.S. MBS index, MBS Index duration, or the measure of a security’s price sensitivity to a change in interest rates, now sits at 4.15 years, down from a recent high of 4.47 on April 22. According to Bloomberg, the duration drop indicates returning refinancing concerns, as homeowners are expected to increasingly refinance into lower mortgage rates and pay off their previous loans.The Index also notes that prepayment speed has shown increases of more than 20% in the last two monthly reports. However, a renewed rally that has seen the U.S. 10-year yield drop to its lowest level since March 29, and the Freddie Mac 30-year mortgage rate fall for the first time in five weeks, may continue to spark refinancings if sustained. JPMorgan MBS analysts forecasts predict a 15% increase in prepayment speeds for May.Meanwhile, Freddie Mac is pushing MBS through its move to Uniform Mortgage Backed Security (UMBS).The joint Fannie Mae-Freddie Mac security, Uniform MBS, is set to roll out on June 3 and, according to analyst teams at Morgan Stanley and JPMorgan, may cause a rise in volatility. In an article published by Bloomberg, Morgan Stanley and JPMorgan analysts discuss their recommendations on the agency MBS sector following the recent widening of mortgage spreads.In the article, Morgan Stanley advised investors to “go long” the sector, citing a wider 30-year Fannie Mae current coupon Treasury option-adjusted spread as a positive.“The Fannie Mae current coupon spread over a blend of Treasury 5- and 10-year notes, a popular valuation method for mortgage investors, has widened 12 basis points to 85 since March 26, when it closed at its tightest level since January 31, 2018, according to data compiled by Bloomberg,” writes Bloomberg reporter Christopher Maloney. “Its average level last year was 82 basis points.”Freddie Mac’s IRCI updates will be effective beginning with the June 6, 2019, monthly factor/disclosure for all currently issued PCs. This initiative will also apply to the new Freddie Mac UMBS and MBS, which Freddie Mac expects it will begin issuing on June 3, 2019. Demand Propels Home Prices Upward 2 days ago The Best Markets For Residential Property Investors 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago The Week Ahead: Nearing the Forbearance Exit 2 days ago Previous: Joseph Grimes Joines Blue Water Advisory Board Next: The Industry Pulse: Updates on WFG, ComplianceEase, and More Freddie Mac MBS Refinance UMBS 2019-05-09 Seth Welborn Tagged with: Freddie Mac MBS Refinance UMBS About Author: Seth Welborn in Daily Dose, Featured, News, Secondary Market The Best Markets For Residential Property Investors 2 days ago A Look at Mortgage-Backed Securities Trendslast_img read more