Stocks are off week over week highs, the 10yr note is ticking back down toward 3.00%, and rate sheet influential MBS prices are approaching reprice for the better territory.
Looking at a comparison of loan pricing today vs. loan pricing yesterday...
Rebate is 15bps worse on average with the biggest bp reductions in the note rates closest to par. Interest rate buydowns are generally more expensive led by "cuspier" 4.0 MBS coupon mortgage rate paper like 4.75 and 4.625% notes. READ WHY HERE
Your loan pricing is based on the August delivery MBS coupons...
For note rates 4.25 to 4.75, you should be watching the 4.0 coupon. The Fannie Mae 4.0 MBS coupon is +0-01 at 101-04 .The FNCL 4.0 needs to trade over 101-15 for more lenders to reprice for the better.
For note rates 4.875 to 5.25, you should be watching the 4.5 coupon. The Fannie Mae 4.5 MBS coupon is +0-03 at 103-15. We'll need to see the FNCL 4.5 trade over 103-15 for more lenders to recall rate sheets.
Reprices for the better are becoming more likely as S&Ps move lower into the close. S&P futures are currently -1.00 at 1058. Look for traders defend the overnight low of 1056. A breakdown at this pivot would lead to a retest of 1050...which would further your chances for a reprice for the better.
I will be traveling back to Annapolis from North Carolina for the rest of the day and will have limited access to market data. If you're watching the market I could use a little assistance this afternoon. Please use the comments section to update fellow rate watchers on developments.
MBS Market Alerts
