Good morning and happy hump day! Our only scheduled housing release for the week was today, Mortgage Applications for the week ending July 1. Last week’s number was a small positive at +0.7% and was the third up-week in a row. Today took us back to the negative with a -5.4% release. The big news continues to be recession fears. Money is being driven into safe assets like SBAs and treasuries as the risk-off trade continues to gain favor.

Today’s bonds are quite volatile, with the 10yr T-Notes -9/32 yielding 2.84% after opening +20/32. MBS have performed likewise, as FNMA 30yr 4.50% are -6/32 to $100-31, which is a 4.26% yield and +140 to the 5.4yr treasury curve. That’s it from us. Have a great day and call or email with your MBS and whole loan inquiries.

Cherry Picks

ARMS / FLOATERS

Cost
$102-08
$20mm+ Fannie Mae 7/1 ARM 2.67%, #BM6801, 6/49 stated final
Average Life
2.2 yr
Yield
3.75%
Speed
35% CPR
Spread
+48/i curve
Coupon
2.67%
MTR
15
Loans
4,127
Caps
Periodic 5/2/5, Lifetime 7.78%
Floor
1.601%
1 Yr. Libor
+1.601%
WAM
288
Factor
.7068

10 Year Fixed

Cost
$96-12
$9mm+ Fannie Mae 10yr am 2.50%, #MA4636, 6/32 stated final
Average Life
3.8 yr
Yield
3.52%
Speed
241 PSA
Spread
+10/I curve
Coupon
2.50%
# Loans
744
Origination
2022
Type
Fannie Major
WAM
118
Factor
.9888

15 Year Fixed

Cost
$92-12
$50mm Fannie Mae Dwarf 2.00%, #MA4602, 5/37 stated final
Average Life
5.9 yr
Yield
3.48%
Speed
127 PSA
Spread
+8/I curve
Coupon
2.00%
# Loans
4,011
Origination
2021/2022
Type
Fannie Major
WAM
177
Factor
.9849

20 Year Fixed

Cost
$94-00
$30mm+ Fannie Mae 20yr am 3.00%, #MA4643, 5/42 stated final
Average Life
7.2 yr
Yield
4.01%
Speed
132 PSA
Spread
+64/I curve
Coupon
3.00%
# Loans
3,212
Origination
2022
Type
Fannie Major
WAM
237
Factor
.9917

30 Year Fixed

Cost
$88-24
$50mm Fannie Mae 30 yr am 2.50%, #MA4652, 6/52 stated final
Average Life
10.2 yr
Yield
3.97%
Speed
104 PSA
Spread
+66/I curve
Coupon
2.50%
# Loans
597
Origination
202/21/22
Type
Fannie Major
WAM
358
Factor
1.0000

Agency CMBS

Cost
$87-09
$20mm+ FNMA 10yr DUS #BS4697, 2.16% coupon, 2/2032 stated final
Average Life
9.3yr
Yield
3.82% + 45/swaps
Speed
0% CPY
Coupon
2.16%
Call Protection
5-4-3-2-1
Tier
2
GEO
CT
DSCR
--
LTV
70.3%
OCC
95%
Interest Only Until
44 Months
Factor
1.0000

Agency CMO – 3 Year

Cost
$95-01
$13mm Freddie Mac "Pass-Thru" 2.50%, FHR 5200 NT, 4/35 stated final
Average Life
4.6 yr
Yield
3.69%
Speed
140 PSA
Spread
+30/I curve
Collateral
Mod Seas Fannie 15yr 2.50%
Coupon
2.50%
Band
Pass Thru
Avg Life w/ rates +300
4.8 yr
Factor
.9278

Agency CMO – 5 Year

Cost
$96-20
$28mm+ Fannie Mae "Pass-Thru" 3.00%, #FNR 17-24 E, 4/47 stated final
Average Life
5.5 yr
Yield
3.69%
Speed
159 PSA
Spread
+30/I curve
Collateral
FNMA 30yr Seasoned 4.50%
Coupon
3.00%
Band
Pass-Thru
Avg Life w/ rates +300
6.2 yr
Factor
.2954

Agency CMO – Long End

Cost
$73-01
$4.3mm Freddie Mac "Sequential" 2.00%, #FHR 5083 ML, 3/51 stated final
Average Life
17.7 yr
Yield
4.22%
Speed
98 PSA
Spread
+70/I curve
Collateral
New Fannie Major 30yr 2.00%
Coupon
2.00%
Band
Sequential
Avg Life w/ rates +300
18.4 yr
Interest Only until
6/33
Factor
1.0000

Jim Tait is a registered representative with and offers securities through Hanover Securities, Inc. (Hanover), Member FINRA & SIPC. Although this information has been obtained from sources we believe reliable, we do not guarantee its accuracy, and it may be incomplete or condensed. This is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Securities that may be shown are subject to availability and changes in price. Past performance is not indicative of future results. Changes in any assumptions may have a material effect on projected results.

 This information from Hanover Securities is for your private use and does not constitute an offer or solicitation with respect to the sale of any security. This information was obtained from sources we believe to be reliable but we do not represent that it is accurate or complete, and it should not be relied on as such. Certain transactions may give rise to substantial risk and are not suitable for all investors. This information was based on current market indicators which may vary over time. We may from time to time buy or sell, or have long or short positions in securities identical or related to those identified herein. 

Although this information has been obtained from sources we believe reliable, we do not guarantee its accuracy, and it may be incomplete or condensed. This is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Loans and/or Securities which may be shown are subject to availability and changes in price. Past performance is not indicative of future results. Changes in any assumptions may have a material effect on projected results. This information from Banes Capital Group (BCG) and/or Hanover Securities is for your private use, and was obtained from sources we believe to be reliable. However, we do not represent that this information is accurate or complete, and it should not be relied on as such. This information is for institutional investors only, and as such certain transactions may give rise to substantial risk and are not suitable for all investors. This information was based on current market indicators which may vary over time. We may from time to time buy or sell, or have long or short positions in loans or securities identical or related to those identified herein. 

The pricing of loans or any Level II or III asset is inherently an exercise in quantifying uncertain variables. As such, great care should be taken when pricing loans for reporting purposes. The information included herein should never be taken as the sole method, or even a method to be relied on, for the pricing of loans or other Level II or III assets as this is for informational purposes only.