MBS Live: MBS Afternoon Market Summary
In the first few seconds of trading following this morning's NFP release, 10yr yields dropped from 2.59 to 2.54. From there, they eased gently lower to mid 2.51's in the 1pm hour and haven't budged since. MBS experienced a similar move with Fannie 3.5s moving from 102 to 102-15. They're currently heading toward the exits at 102-19. That's really all there is to it today. The jobs report was hotly anticipated. The headline was weaker. Bond markets rallied.
Expectations for the tapering timeline were further tempered by the increasingly negative turn in labor markets. A new survey of primary dealers now shows the consensus for the Fed to BEGIN reducing asset purchases to be pushed all the way back to March 2014. That timing suggests that that the Fiscal drag is now a leading concern for Fed policy, or at least for the markets' expectations of Fed policy.
MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
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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.
3:01PM :
Both GSEs Expand HARP Eligibility Window
After this morning's Freddie Mac announcement, Fannie has followed suit in today's selling guide update:
"Fannie Mae is revising the requirement related to the mortgage eligibility date of the existing mortgage loan. Currently, to be eligible for DU Refi Plus or Refi Plus, the original loan had to have been acquired by Fannie Mae on or before May 31, 2009. The May 31, 2009 eligibility date will now be based on the note date of the original loan. Using the note date is more transparent to borrowers because borrowers know when they closed on their prior mortgage loan. (Borrowers typically do not know when their loan was sold to Fannie Mae.)"
"Fannie Mae is revising the requirement related to the mortgage eligibility date of the existing mortgage loan. Currently, to be eligible for DU Refi Plus or Refi Plus, the original loan had to have been acquired by Fannie Mae on or before May 31, 2009. The May 31, 2009 eligibility date will now be based on the note date of the original loan. Using the note date is more transparent to borrowers because borrowers know when they closed on their prior mortgage loan. (Borrowers typically do not know when their loan was sold to Fannie Mae.)"
11:56AM :
Revised Eligibility Date for Relief Refinance Mortgages
From Freddie:
To make our eligibility requirements more transparent to borrowers, effective October 27, 2013, we will use the note date of the mortgage being refinanced, instead of the Freddie Mac settlement date, to determine eligibility for our Freddie Mac Relief Refinance MortgagesSM offering.
As a result of this change, the mortgage being refinanced must have a note date on or before May 31, 2009. This revised requirement applies to both Relief Refinance Mortgages - Same Servicer and Relief Refinance Mortgages - Open Access, including those originated under the Home Affordable Refinance Program (HARP). Loan Prospector® and the Freddie Mac Loan Look-Up Tool will be updated by October 27, 2013, to support this change.
The Single-Family Seller/Servicer Guide (Guide) will be updated to reflect this revised eligibility requirement with an upcoming Guide Bulletin.
To make our eligibility requirements more transparent to borrowers, effective October 27, 2013, we will use the note date of the mortgage being refinanced, instead of the Freddie Mac settlement date, to determine eligibility for our Freddie Mac Relief Refinance MortgagesSM offering.
As a result of this change, the mortgage being refinanced must have a note date on or before May 31, 2009. This revised requirement applies to both Relief Refinance Mortgages - Same Servicer and Relief Refinance Mortgages - Open Access, including those originated under the Home Affordable Refinance Program (HARP). Loan Prospector® and the Freddie Mac Loan Look-Up Tool will be updated by October 27, 2013, to support this change.
The Single-Family Seller/Servicer Guide (Guide) will be updated to reflect this revised eligibility requirement with an upcoming Guide Bulletin.
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.
Andy Pada : "boom! Fannie conforms to the new date"
Andy Pada : "https://www.fanniemae.com/content/announcement/sel1308.pdf"
Andy Pada : "that is the interesting part, I don't see an FHFA statement on this which leads me to think that agencies have some say on the eligibility date."
Andy Pada : "if it is for consumer transparency and HARP is under Making Home Affordable, there can't be two sets of rules. Consumers would be treated differently for presumably one program."
Scott Valins : "why have to? FHFA mandated?"
Timothy Baron : "Would be nice if they did. I know I have at least a few borrowers that could then use HARP if Fannie switches to the Note date."
Andy Pada : "they will have to."
Scott Valins : "thanks AP. Wonder if Fannie will do it too"
Andy Pada : "http://www.freddiemac.com/singlefamily/news/2013/1022_revised_eligibility_date.html"
Matthew Graham : "RTRS- POLL-MAJORITY OF DEALERS SAYS BUDGET/DEBT LIMIT IMPASSE TO HAVE 'SIGNIFICANT' EFFECT ON TIMING OF FED TAPERING "
Matthew Graham : "RTRS- POLL-9 OF 15 DEALERS SEE FED TAPERING IN MARCH, 2 SAY JAN, 2 SAY Q1 2014, 1 SAYS JUNE, 1 SAYS NO SOONER THAN JAN "
Matthew Graham : "REUTERS POLL-MOST U.S. PRIMARY DEALERS SEE FED REDUCING BOND PURCHASES IN MARCH 2014 "
Sung Kim : "6 months from purchase date"
Jeff Anderson : "6 months here for Wells."
Bryce Schetselaar : "How long is Wells' EPO?"
Rob Clark : "REPRICE: 1:45 PM - Interbank Better"
Joe Probst : "It is funny that we are up 2o tics and some of the lenders are priced worse than they were yesterday."
Justin Harward : "I'm sure this has probably already been discussed earlier today. But with the NFP report, is the consensus of the group no tapering for 2013? (with the last 2 FOMC"
Tony Mango : "My borrower has to pay his x about 3k a month. He qualifies with that, however, they are jsut seperated. The 3k is in the sep agreement filed with court. They are doing this themselves Final divorce hearing is Jan, wnats to close Nov"
Justin Heiden : " if this is alimony paid out, then you typically have to wait for the divorce to be finalized because the monthly alimony expense can change as part of the divorce negotiation/settlement"
Sung Kim : "what is alimony debt?"
Jason York : "we've been able to use separation agreements before, as long as you can show receipt"
Jeff Anderson : "REPRICE: 12:45 PM - Chase Better"
Ted Rood : "gonna go with final executed divorce decree....."
Tony Mango : "UW question for the group-If a borrower is legally seperated and not final divorced, can we use the alimony debt from the seperation agreeemnt or is UW goin to make us wait until the divorce is final?"
Matt Hodges : "it was this year; it's now 12/31/15"
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